How Young Adults Can Protect Their Finances From Trump’s Tariffs

This post was originally posted on Planner Bee.

Whether you’re just learning to budget, saving for a big purchase, or building your investment portfolio, politics can still impact your finances, even if you don’t closely follow the news. With President Donald Trump signaling sweeping tariffs, this is a good time to understand how trade policies might affect your money and what you can do about it.

What are tariffs and why should I care?

Let’s break it down.

Tariffs are taxes placed on goods imported from other countries. When a country like the United States imposes tariffs on products such as electronics, clothes, or cars, these items become more expensive to bring in. Businesses often pass this additional cost on to shoppers.

For example, if a $1,000 laptop imported from China suddenly has a 10% tariff, you might be paying $1,100 instead. And it’s not just gadgets. Tariffs can push up prices on groceries, tools, and even everyday essentials.

Bottom line? Tariffs mean higher prices, less purchasing power, and potentially more financial uncertainty. Here’s how you can prepare and protect your money.

1. Get familiar with what you spend on imports

Young professionals today are more global than ever. We buy Korean skincare, Japanese cars, Italian coffee machines, and Chinese electronics. If tariffs increase, the prices of these imported items will likely rise as well.

What you can do

• Audit your spending: Take 15 minutes to review your online purchases or regular shopping list. Are many of your go-to items imported?
• Find alternatives: Look for local or tariff-free options. Switching to brands made in your country or region can help you save.
• Delay big purchases strategically: If tariffs are likely to affect certain categories (like electronics or appliances), consider buying before prices rise. Or wait for promotions if prices spike and then settle.

2. Inflation-proof your budget

Tariffs often lead to inflation, causing the cost of goods and services to rise across the board. If your salary doesn’t keep pace, your money won’t go as far.

What you can do

• Adjust your monthly budget: Factor in an “inflation cushion” of about 5–10% for essentials like groceries, transport, and meals out.
• Cut lifestyle creep: It’s easy to start spending more as your income grows, but now’s a great time to cap your discretionary spending. That means fewer impulse buys, less takeout, and keeping subscriptions in check.
• Build a ‘rising cost’ fund: In addition to your emergency savings, consider a buffer fund to manage higher bills without going into debt.

Pro tip: Budgeting tools like YNAB (You Need a Budget) or Mint can help you track spending and make changes as needed.

3. Reconsider your investment strategy

If you’ve started investing through a robo-advisor, individual stocks, or your company’s retirement plan, it’s worth understanding how tariffs can impact the markets. Industries that depend heavily on global supply chains, such as tech, automotive, and retail, are often more sensitive to trade tensions.

What you can do

• Don’t panic-sell: Markets often dip in response to political news. Unless you need the cash soon, holding steady usually works out better than selling at a loss.
• Diversify your portfolio: Don’t just invest in U.S. tech stocks or trendy ETFs. Spread your investments across different industries and countries.
• Stay focused on the long-term: Tariffs can cause short-term market swings, but long-term investing typically evens them out, especially if your goals are far off.

Reading tip: If you’re just getting started, try The Simple Path to Wealth by JL Collins or I Will Teach You to Be Rich by Ramit Sethi. Both offer straightforward advice.

4. Be a forward-thinking employee

Tariffs affect more than just consumer goods. They can also shape hiring trends, job stability, and salaries, particularly in industries tied to global trade.

What you can do

• Add valuable skills: If you work in sectors like manufacturing, logistics, or tech hardware, learning new skills can make you more adaptable and harder to replace.
• Build multiple income streams: Side hustles, freelance work, or passive income from investments can give you more financial security if your main job is affected.
• Be proactive about pay: If prices rise, your salary needs to keep up. Don’t hesitate to negotiate a raise, particularly if your role becomes more demanding.

Skill ideas: Digital marketing, coding, UX design, and data analysis are in demand and less exposed to global trade shocks.

5. Think global, spend local

You don’t need to give up international brands altogether, but adding more local options to your routine is a smart move. Supporting domestic businesses can not only help the local economy but also shield you from the ripple effects of tariffs.

What you can do

• Buy local when it counts: Groceries, clothes, skincare, and even entertainment can often be sourced locally. A few swaps can make a difference.
• Support small businesses: Local businesses are less likely to be caught up in global trade drama and may offer better value, especially for food, services, and home goods.
• Explore second-hand or refurbished: It’s budget-friendly, sustainable, and reduces reliance on imports. Here are some of the best thrift stores in Singapore.

Idea: Use platforms like Facebook Marketplace, Carousell, or Thrift+ to find good-quality second-hand products.

6. Stay informed, but don’t stress

Trade policy can be complex, and headlines rarely tell the whole story. A basic understanding can help you make informed decisions without unnecessary worry.

What you can do

• Follow reliable news sources: Stick to reputable outlets like Bloomberg, Reuters, or The Financial Times for well-rounded coverage.
• Set up Google alerts: For keywords like “Trump tariff”, “trade war”, or “consumer price index” so you get relevant updates without scrolling endlessly.
• Speak to a financial adviser: If you’re unsure how tariffs could affect your investments or career, a one-off session can give you useful clarity.

Podcast recommendations: “Planet Money”, “The Indicator”, and “How to Money” break down economic news in a fun, digestible way.

Prepare, don’t panic

As a young professional, you’re in a strong position to start building lasting financial habits, including learning how to navigate uncertainty. Tariffs may cause temporary price hikes or market fluctuations, but they don’t have to derail your goals.

Consider this a financial resilience check-in. The goal is not just to react to headlines, but to develop a flexible mindset and a toolkit you can depend on when facing tariffs, inflation, or other economic shifts.

Being prepared means you can make more intentional choices: where to shop, how to budget, when to invest, and which skills to build. These small but steady steps can help you stay grounded, even when the news cycle feels overwhelming.

Keep in mind that economic ups and downs are a natural part of life. Staying informed, adaptable, and proactive will help you not only endure these shifts but also grow because of them.

Read more: The Rise of Doom Spending and How to Avoid It