What can you do about U.S. tariffs affecting your finances?

By Sun Life Staff

News of trade tensions between Canada and the U.S. may have left you with questions. What might this mean for the economy and your money? Here’s some considerations for you:

On March 4, 2025, U.S. President Donald Trump’s administration implemented a 25% tariff on most Canadian goods entering the United States from Canada. Energy products from Canada, such as natural gas and oil, will face a 10% tariff.

Trade tensions can lead to uncertainty in the economy and increased market volatility.

Concerned about how this could affect your budget, your investments and your retirement savings? We’re here for you.

What actions can you take right now?

The reality is, we don’t have control over world events. But here are 3 things you can do to help protect your finances:

Don’t panic

  • Think things over carefully. Don’t make rash decisions about your finances during challenging economic and political times.  Stick to your financial roadmap if you have one, if you don’t consider building one today.
  • Resist the urge to pull money out of your RRSP. Selling market-based investments could cause long-term losses to the value of your portfolio.
  • Build up your emergency fund. A TFSA is a great place to put money aside for when you might need it.

Diversify your portfolio

  • If your portfolio is overly concentrated in a certain asset class, investment style or sector you may want to consider diversifying your investment to avoid concentration risk.  There’s the old saying, don’t put all of your eggs in one basket so if one part of your portfolio experiences difficulty other parts may not participate as significantly or may even move in the opposite direction.  
  • By combining several investments or choosing an investment like a Target Date Fund, Diversified or Balanced fund you can benefit from a diversified portfolio that may weather times when markets are more volatile. 

Get professional advice

We offer advice to help you navigate through challenging times.

Please call a licensed Financial Services Consultant1 today (Monday to Friday, 8 a.m – 8 p.m. ET.).

  • If you are in an employer group plan call: 1-866-634-4840
  • If you are in a Choices plan call: 1-877-805-9303

Frequently Asked Questions

A tax (or duty) that a government imposes on goods imported from other countries. Basically, it’s an extra charge added to foreign goods to make them more expensive.

Governments may impose tariffs to protect their own industries. Raising prices of imported goods may make local manufacturing comparatively cheaper. They’re also used to raise government revenue.

A country may choose to impose tariffs as retaliation. In this case, Canada has prepared to impose retaliatory tariffs on American goods imported into Canada.

Here’s an example of how a tariff could work:

Let’s say the U.S. government levies a 25% tariff on cars made in Canada.

Imagine that Canadian-made car is worth $40,000.

The tax would add an additional $10,000 to the sticker price: $40,000 x 25% = $10,000.

The total cost to an American car buyer would be $50,000: $40,000 + $10,000.

This makes it harder for Canadian car manufacturers to compete with U.S. car manufacturers.

In 2 main ways:

  1. Higher prices. Companies importing tariffed goods often pass on part or all of the extra cost to consumers.
  2. Economic fluctuations. Over time, tariffs might contribute to rising inflation, job losses and recessions.

It depends on how the situation evolves. Market volatility is normal. Selling assets when they’ve lost some value creates the risk of locking in those losses. That could significantly impact the long-term value of your investments.

We’re here for you

Our commitment to helping you manage uncertainty is unwavering. You can count on us.

Over our 160-year history, we’ve navigated through complexity with adaptability and resilience. We focus on what truly matters: helping Canadians achieve lifetime financial security and live healthier lives.

1 Registered as financial securities advisors in Quebec.

This article is meant to provide general information only. Sun Life Assurance Company of Canada does not provide legal, accounting, taxation, or other professional advice. Please seek advice from a qualified professional, including a thorough examination of your specific legal, accounting and tax situation.

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