Why Trump’s effect on retirement accounts are 'far more severe' than you realize: ex-Wall St. banker

25 March

Between draconian cuts to the U.S. Social Security Administration (SSA) and fears that President Donald Trump's economic policies — including steep new tariffs — will cause 401k accounts to plummet in value, many older Americans have major concerns about their ability to retire.

In an op-ed published by the New York Times on March 24, William D. Cohan — a founding partner of Puck Media and former Wall Street banker — warns older Americans that their retirement accounts may be in very bad shape in the months to come.

"Our stock market is starting to crack," Cohan explains. "Investor confidence is rapidly dissipating. And changes in the way Wall Street works mean that the impact on your retirement portfolio could be far more severe than you may realize. With the S&P 500 index down nearly 8 percent from its February peak, the U.S. equity markets are approaching bear-market territory, signaling a growing consensus in Corporate America that a recession may be around the corner."

Cohan adds, "After declining for three months in a row, consumer confidence is at its lowest level since July 2022, according to the University of Michigan index. Retailers are suffering: Ralph Lauren stock fell 19 percent in the last month alone. There are plenty of other stocks that are tanking, too."

According to Cohan, Trump's tariffs could have a "disastrous" effect on the economy — including retirement accounts.

"If history is any guide, it could get pretty bad: Financial reckonings tend to happen once every 20 years or so, and we are nearly 17 years out from the devastating financial crisis of 2008," Cohan warns. "This time feels different because the damage is at least partly inflicted by the nine-week-old Trump Administration, which recently signaled its determination to impose disastrous tariffs, even if doing so unleashes a recession. Corporate executives and Wall Street are rattled. President Trump is lighting the match."

The former Wall Street banker notes that "many ordinary retirement portfolios" have considerable exposure to "some of the highest-priced stocks we've seen in our lifetimes, which many believe are poised to return to Earth."

"Now might be a good moment to check on your retirement funds, because what you may have thought were safe index funds are actually tilted heavily toward the biggest and baddest technology stocks," Cohan advises. "And they could be suddenly facing a financial reckoning."

William D. Cohan's full New York Times op-ed is available at this link (subscription required).

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