The Future Feels Uncertain—Should Your Investments Change?

Many wonder, “What if this time is different?”

The political climate feels more uncertain than ever, and many investors are wondering: should I change my investing approach? While no one can predict the future, I’m staying the course (for now)—and here’s why, along with some key considerations for managing risk, protecting your assets, and thinking beyond just the stock market.

A friend called me, worried.

"Look at everything happening now that Trump is back in office—cuts to agencies, attempts to defund crucial programs, blatant power grabs, some successful, some not, some still in limbo."

"I don’t want to be alarmist," she said, "but I also don’t want to be like the frog in the pot of water that heats up so slowly that, by the time it realizes it’s boiling, it’s too late to jump out."

She wondered: Should I be pulling money out of my investment accounts? Keeping cash in my mattress? Buying gold?

She has worked in finance and understands investing well, but her concern was one I hear often: that staying the course is smart only until it isn’t. And by the time it becomes obvious that it was the wrong move, it’s too late to do anything about it.

I get that. You’re anxious. I’m anxious. A core strategy of this administration is to stoke anxiety among its opponents. It’s working.

So, what do we do?

First, A Reality Check

I’m just a person. I don’t have a crystal ball. If new information emerges that suggests I should rethink my approach, I will—and I’ll keep you posted.

But for now, I’ve made no changes to my investment strategy. Given that my retirement is decades away, that means my portfolio remains mostly in stocks, with some bonds and cash, almost all held in low-cost Exchange-Traded Funds (ETFs) that provide exposure to companies and governments worldwide.

What about you? Should you change your investing approach in light of the current political climate?

Before making any major moves, let’s outline some core investing principles—ones that remain true no matter what’s happening in the news:

1. Your Portfolio Should Match Your Risk Tolerance

Risk tolerance has two components:

• Time Horizon: If you don’t need your money for decades, you can likely afford to take on more risk. Even a major market downturn today could be recouped over the long term. If you need your money very soon, vehicles that carry no risk of loss—like high-yield savings accounts—are worth considering even if they deliver only modest returns. 

• Emotional Tolerance: If the ups and downs of the stock market cause you sleepless nights, a more conservative portfolio—with a heavier mix of bonds and cash—might be worth considering. Just remember: less risk typically means lower returns, so you may need to save more or adjust your expectations for the future.

2. Diversification is Key

Holding a mix of stocks and bonds from different countries and industries helps protect you from relying too much on a single company, sector, or economy.

3. Markets Have Survived Crises Before

The financial system has endured a lot—the Great Depression, World War II, deep recessions, terrorist attacks, constitutional crises, and more. It’s far from perfect, but many of the laws and regulations that reinforce it were created in response to those very crises.

History doesn’t guarantee the future, but it does provide some perspective.

But What If This Time Is Different?

I don’t know that it won’t be.

But here’s what I do know:

• Republicans invest in the stock market, too. A full economic collapse would hurt them as much as anyone else.

• Corporate leaders—many now in Trump’s inner circle—have a vested interest in maintaining financial stability.

• Even in times of political instability, markets don’t cease to function. They may be volatile, but they continue to exist.

None of this means investing is risk-free. There is always risk—that’s why investors earn returns. If you invest in stocks, you own pieces of companies. If you invest in bonds, you’re lending money to corporations or governments. You expect a return higher than what you’d get in a savings account, but in exchange, you take on risk.

If that risk makes you uncomfortable, you have options:

• More Bonds, Less Stock: Bonds tend to be less volatile but also have lower expected returns.

• Cash Savings: If you fear market chaos, holding more cash in high-yield savings accounts or CDs can provide stability.

• Annuities: These insurance products offer guaranteed payments, but they often come with high fees and limited growth potential.

Many financial professionals recommend strategies based on how they get paid. Advisors who charge a percentage of assets under management benefit when you invest more in stocks and bonds. Those who sell annuities or insurance products earn commissions when you buy them.

I charge a flat fee—so I have no financial stake in which approach you take. My goal is to help you find a strategy that serves your situation, not the one that benefits me.

But What About Total Collapse?

This is where things get darker.

You may not just be worried about volatility. You might be wondering:

• What if Trump seizes more power and stops being accountable to voters?

• What if sheer incompetence or recklessness leads to a market disaster?

• What if there’s nuclear war?

If you’re thinking along these lines, I don’t really have personal finance answers for you. Because I don’t think personal finance has answers for these scenarios.

Could you move everything into so-called “safe” investments? Sure. But what, exactly, are you envisioning?

• A world where stocks and bonds collapse, but insurance companies keep paying out annuities?

• A world where financial markets crumble, but banks still function as usual?

• A world where the U.S. dollar is worthless, but gold retains value (and you somehow store it safely and trade it for what you need)?

• A world where crypto replaces fiat currency (despite requiring electricity, internet, and trust in decentralized networks to function)?

At a certain point, financial strategies become irrelevant. If the dystopian scenarios keeping you up at night come to pass, water, food, and close relationships with people you trust will matter far more than how much gold you own.

Invest in Community, Not Just Markets

If you’re deeply worried about the direction of the country, remember: we are not just spectators in our democracy—we are participants.

We still have a representative government. We still have elections. If you’re frustrated with the Democratic Party’s response to all this, get involved. Support primary candidates who align with your values. Run for office yourself. Make sure your representatives—even the ones you disagree with—know you exist and are paying attention.

Financial security isn’t just about markets. It’s about having a say in the world you’re building for yourself and those who come after you.

Final Thought: Be Smarter Than the Frog

One of my clients shared a fear: “What if I stay the course, and by the time I realize that was a mistake, it’s too late?”

None of us can predict the future. But we can stay informed, aware, and ready to act if needed.

And that frog-in-the-boiling-water metaphor? It’s nonsense. A frog would absolutely jump out before it boiled to death.

Your challenge is to be at least as aware as the frog. Stay informed, stay engaged, and trust yourself to make smart financial decisions in real-time.

I’ll be here to help.