Trump Tariffs Impact on Irish Pensions – Should We Keep Calm & Carry On?

If 2025 has taught us anything about pensions and investments, it’s the importance of keeping a cool head during bouts of stock market volatility. Markets have been on edge since the US President Donald Trump threatened tariffs earlier this year. While Trump’s constant see-sawing means that many of his threatened tariffs have not yet come to fruition, the uncertainty created by his protectionist policies has taken its toll on investors. Pension savers and those close to retirement are understandably concerned.

Generally, an investment in a pension is intended to be for the long haul. So, when bouts of stock market volatility or uncertainty hit, what may be a reasonable approach is to expect that this volatility will pass and that the markets will bounce back in the future. Furthermore, if you’ve been investing into a pension for some time before the recent stock market volatility hit, you’ve potentially had significant growth in recent years overall and therefore a drop in value, whilst unwelcome, may eat away at your investment growth rather than your capital investment.

Short-term bouts of stock-market volatility are to be expected and history shows us that investments can recover from losses over time. The Standard & Poor 500, a stock market index which tracks the stock performance of 500 leading companies listed on stock exchanges in the United States, has gained about 10.5% annually since its introduction in 1957.

It is always important to avoid rash decisions and reactions when it comes to investments and pensions. This is where the guidance of a financial adviser is invaluable. A regulated financial adviser will help you identify suitable investments and make well-informed decisions to maximise your pension savings.

For those approaching retirement, bouts of stock market volatility can be a big worry, particularly if the volatility arises near to a time that they had planned to access their tax-free lump sum. People in this situation often face the dilemma of whether they should extend their retirement date to see if markets recover before drawing down their pension - or if funds are required, if they should encash some funds before the markets possibly drop further. It is really important to speak with your financial adviser if you have concerns and potentially need access to pension funds in the short term. At times of stock market volatility, there is no guarantee if and when the values potentially will recover so it’s vital to assess your circumstances, and the best strategy going forward, with your adviser.

Your financial adviser will also be able to provide guidance on key investment strategies, such as diversification, where rather than putting all of your eggs in the one basket, you invest in a range of different investment assets and types, thereby smoothing out and reducing the investment risk. There are many pension schemes with a mix of assets ranging from trading accounts, life company assets, property and company investments. In funds and equities alone, you have the ability to invest in a wide range of assets across different markets and exchanges.

While this year may be a difficult time to invest, there will always be issues that trigger stock market volatility. Get impartial advice before changing or deciding on investment strategies for your pension.

Glenn Gaughran, Head of ITC Business Development & Marketing