KANSAS CITY, Mo. — When retired school counselor Don Herneisen meets up with friends each week for breakfast at a hole-in-the-wall restaurant, the conversation often turns to the economy. With financial markets in turmoil as President Donald Trump unveiled his latest tariffs this week, the popularity of that topic is unlikely to change anytime soon.
“There’s political uncertainty, there’s economic uncertainty, and if you’re retired, you don’t much like uncertainty at this point,” said Herneisen, 77, as he and his wife made a stop at Union Station in Kansas City, Missouri, on Friday while visiting family.
Stock markets worldwide careened even lower Friday after China matched Trump’s big raise in tariffs in an escalating trade war. The sweeping new tariffs, on top of previous levies and retaliation worldwide, are also expected to increase prices for everyday items.
Herneisen, who lives in Lancaster, Pennsylvania, and his wife, Cathy Herneisen, a 74-year-old retired Verizon worker, are living on a mix of pension, Social Security and an individual retirement account, or IRA. He said that for now they aren’t cutting back, but his wife clarified that even holding steady means cutting back.
“Prices are higher, but I am still spending the same amount of money,” she said. “I am sticking with the grocery budget, and that means that I’m cutting back on prepared food, so I’m buying the products themselves so it is hurting people who run a small business that sell their pre-made food.”
They live in a Republican-leaning area of the swing state but neither voted for Trump, who has said Americans may feel “some pain” because of tariffs, but that the long-term goals, including getting more manufacturing jobs back to the U.S., are worth it.
Chad NeSmith, a portfolio manager at Tobias Financial Advisors in Plantation, Florida, just outside of Fort Lauderdale, said that they’d been fielding calls from clients for the last couple of days and the calls were increasing on Friday.
“Fear is really picking up, especially since we have the retaliatory tariff from China,” he said.
NeSmith said most clients just had general questions, checking up on what they should be doing with their portfolios. “We’re taking it on a call-by-call basis,” he said.
NeSmith said retirees generally have a little bit less risk in their portfolios and bonds have been performing well in the volatility.
“The overall theme that we’re really getting at is you really have to be aware of your risk tolerance and your financial plan, and you needed to do that going into this so that way you can ride through this volatility that we’re seeing right now,” he said.
Colleen Power, a 57-year-old payroll specialist from Kansas City, Missouri, is hopeful the market will recover before she retires.
“We have our things situated in a way that we will probably survive,” she said. “Now, in general, yes, I am definitely worried for the country. But I mean, on a personal level, I don’t have a whole lot of stress about that at the moment.”
But Power, a Democrat, finds the situation frustrating nonetheless. “None of this is in any way surprising on any level, in any way, and all I can do is do the best I can in my local area and hope for the best,” she said.
Paul Brahim, an advisor at Wealth Enhancement Group in Pittsburgh, said, “Uncertainty is frightening, not knowing is scary and people are asking the same question all the time: ‘Am I going to be OK?’”
He said that for a recent retiree who hasn’t started taking Social Security yet and is living off the cash flow from assets, watching that value decline in just a few days is “frightening.”
But, he said, if they have prepared well, there should be reserves in place. “We should have cash in reserve that we can use while we allow that portfolio to heal,” he said.
Brahim, president of the Financial Planning Association, a membership organization for certified financial planners, said most of his clients have broadly diversified portfolios and, looking back over the last year, they’ve had positive returns. “It’s good to just put it into perspective, that helps with the fear,” he said.
“I think it’s important that we take a breath and that we pause through uncertainty before we make adjustments to our portfolio,” he said. “Let the dust settle.”
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Stengle contributed to this story from Dallas.