Document Type

Article

Publication Date

2026

Abstract

Many Americans rely on defined contribution plans like 401(k) plans for retirement savings. These plans do not guarantee a fixed retirement benefit; rather, the benefit is based on accumulated contributions and investment performance. When the stock market drops, so do retirement account balances. When inflation hikes living expenses, money does not go as far. President Donald Trump's policies, including those associated with tariffs, are causing economic and resource volatility leading to financial hardship. Americans worry as they watch living costs increase and their retirement savings diminish. It is well known that retirees rely on 401(k) plan balances to fund their living costs. Yet the effects of economic volatility on 401(k) values extend well beyond retirees. Because these accounts serve a dual purpose-funding both retirement and, at times, current spending-workers who are years away from retirement also feel the impact. This Article examines the often-overlooked consequences of economic volatility under Trump 2.0 tariffs and related policies on 401(k) plan participants, including the ways in which inflation and recessionary pressures may drive pre-retirement withdrawals.

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