I had prepared a much more extensive note on the current financial planning landscape in light of UK tax changes and Trump’s effect on the global political and economic environment. 

The themes were similar to those I have talked about before; we can’t rely on taxes reducing in the future, so action to either spend or give away assets to shield against inheritance and wealth taxes is the way forwards, and this requires a significant change of mindset to the British mentality of trying to accumulate wealth throughout your life. These are subjects we will return to.

However, Trump’s tariff announcements, and subsequent rhetoric backing up his approach, have triggered market volatility and falls in portfolio values that we haven’t seen for some time. What makes this different to previous periods of market falls is that there is no fundamental reason for this other than what one individual decides to do when he wakes up each morning.

We had the COVID-19 crisis, the financial crisis and the tech bubble, all significant global issues that had fundamental reasons that needed a step in the direction of being resolved for the recovery to begin.

As was demonstrated at one point yesterday when a rumour circulated that tariffs would be paused for 90 days, resolution is all down to what Donald decides to do next. There is much speculation as to what the outcome of all of this will be with the two extremes being:

• No meaningful negotiations, global recession and significant economic damage
• Negotiations start and we return to “normal conditions” – the tariffs at this rate only apply for a short period 

Something in between is maybe more likely. Time will tell. Markets are currently assuming the worst outcome, which history tells us is consistent with what the initial reaction normally is. What history also tells us is that markets turn and start recovering equally quickly, meaning you have to remain invested to come out of the other side.

Mr Trump is highly sensitive to his popularity and public opinion of him, both are starting to fall dramatically, including with many of his billionaire MAGA supporters who must be in his ear, such that we could flip back to a much more stable outcome at any point. Although, as one client messaged me to say: “he has done more to undermine the West than Russia has managed in 100 years”. Therefore, we could continue to speculate as to outcomes but I am not sure what purpose it would serve.

What should you be doing with your finances?

The investments we recommend are long-term, multi-asset solutions, designed to last the course, including in periods of volatility, so they should remain in place. As should withdrawals continue that support your income and investments being made to build up wealth. Where we should be speaking is if there is an unplanned need for capital on the horizon that will need to be funded from a portfolio we manage.

And of course, if you wish to discuss anything related to your personal circumstances, please do not hesitate to get in touch with your planner, we are always here to talk.