World markets are in a period of volatility as President Donald Trump fulfills his electoral mandate by renegotiating America’s trade deals, ending foreign wars, slimming down the US bureaucracy and slashing wasteful government spending.

That’s all making the president’s critics and some investors nervous. But don’t believe these doom-and-gloomers who are predicting an economic downturn and worse – recession.

I remain very bullish on the American economy for there are tremendous potential upsides to the Trump agenda. That said, there are also reasons to be concerned. Inflation ran hot in January and the Federal Reserve may not be lowering interest rates as quickly as once expected.

No one knows what’s going to happen tomorrow. So, make the best decisions with your money that you can today.

Here’s my time-tested guide to navigating a volatile market, while growing your wealth, shielding yourself from fraud and planning for a comfortable retirement.

Counter Chaos

One of the biggest unknowns roiling markets today is Trump’s trade war. He has delayed the imposition of levies against Canada and Mexico until March 4, while new tariffs against China are already in effect.

Generally, tariffs have an inflationary impact, but I believe that Trump’s duties on foreign goods – if they are all imposed – will be largely short-term measures.

I remain very bullish on the American economy for there are tremendous potential upsides to the Trump agenda. 

In fact, these tariff talks may be over within the next 60 days. But no one can predict the future, so I’m putting any new cash that I generate into low-risk investments.

I haven’t sold any of my equity positions, but I haven’t added to them either. Two weeks ago, I bought 90-day Treasury bills, which are short-term bonds backed by the US government that mature in a year or less.

I’ll reassess this position again after about three months. But for the time being, T-bills offer higher returns (approximately 4.2 percent) than traditional money markets.

About 10 percent of my holdings are parked in these safe accounts. The rest of my money is invested in riskier ventures, but even so, there’s a way to protect yourself from unforeseen events.

My 401k golden rule

If the average 20-something American, making $64,000 annually, invested 15 percent of their salary every month in a retirement account (such as a 401k, or IRA if you’re self-employed), then by the time they were 65 years old, they’d have a $1.5 million nest egg for retirement.

Generally speaking, money invested in the stock market will earn eight to 10 percent annually, if the market performs as it has over the last 200 years.

Additionally, Trump has promised to keep the corporate tax rate at 21 percent (President Joe Biden had threatened to raise it to 28 percent), and that keeps me bullish on S&P 500 earnings for the next 24 months.

But don’t fall into the trap of picking specific stocks. Remember that most fund managers underperform the average annual market return. Instead, follow the golden rule of wealth management – diversification.

The old rule of thumb was to hold 50 percent stock and 50 percent relatively lower risk bonds. But over the last two decades, I’ve changed my approach. I now hold 70 percent stock and 30 percent in bonds or cash.

I diversify my holdings even further by holding collections of stocks called ETFs or exchange traded funds. Some ETFs track entire market indexes like the S&P 500, Nasdaq or Dow Jones.

Crypto Isn’t Crazy

Cryptocurrencies have long been seen as risky investments. And, indeed, in the early days of crypto many investors were hurt by wild swings and the dramatic November 2022 collapse of the crypto exchange, FTX.

Crypto, certainly, is not for everyone. But now that governments are exercising regulatory oversight over the crypto markets (Trump has appointed entrepreneur and tech investor David Sacks to serve as the nation’s first crypto czar), crypto is an increasingly sensible long-term investment.

Bitcoin – alongside gold – is now a core holding in my account (making up 5 percent of the total).

Although Bitcoin is still volatile, it is in limited supply, which means that it isn’t impacted by inflationary pressures like other currencies.

The biggest question for crypto investors is what exchange on which to store and manage their crypto. I use WonderFi, for which I am a strategic investor. I also use Coinbase, which must now follow US government money transmission, anti-money laundering and consumer protection laws and provides tax receipts. 

However, savvy businesspeople are always on the lookout for fraud. And that’s a vigilance that should be applied across all your fiscal affairs.

Get TWO credit cards

Everyone should hold two credit cards. One card should be used for online purchases only and it should have a relatively low borrowing limit – say $2,500.

The reason for this is simple.

Online shopping is inherently risky and chances are that over your lifetime a cyber-thief will attempt to steal your credit card and run up big bills on your account. However, you can control your potential exposure to theft with a credit limit.

Use the second card for all other purchases and building up your credit rating. This card should have a higher credit limit, say $5,000.

Charge at least $50 on the card monthly and be sure to pay it off in full every pay period without exception.

The credit agencies use algorithms to determine credit scores and all they care about is whether you are paying off your balance. The amount that you spend is irrelevant.

It’s critical to establish a good credit score because that rating will determine the terms of the loans that banks are willing to offer.

If you have a high credit score, financial institutions will see you as a responsible borrower deserving of a relatively low interest rate. Borrowers with poor credit scores are seen as risky – and lenders compensate for that risk by charging higher rates.

Teach this lesson to your friends and family. They’ll thank you for it. And if there’s a significant other in your life, there’s another rule to abide by.

No one knows what’s going to happen tomorrow. So, make the best decisions with your money that you can today.

Say ‘I do’ to a prenup

The reality is that financial stress, not infidelity, is the number one reason marriages fail.

No, this is not romantic advice, but it’s necessary. And even if you don’t get married and instead cohabitate, sign a prenup!

A prenuptial agreement forces each person in a relationship to disclose their net worth, assets and liabilities. It’s essential to know how your future spouse or partner handles money. And if your romantic interest is not willing to talk about their financial past that is a giant red flag.

A prenup effectively removes fiscal anxiety from the stressors on a relationship. And in the event that the union fails, you’re not at risk of losing your hard-earned cash, because the agreement lays out how the assets will be divided in case of a split.

Marriage does not mean that you have to sacrifice personal sovereignty.

In fact, you should also keep separate credit cards and bank accounts. Couples can establish joint accounts for everyday expenses – but don’t completely abandon your financial independence.

When it comes to family, money can either strengthen bonds or destroy them.

Be wary – especially when it comes to in-laws.

Never lend to your family

I have been very fortunate in my life and as a result family members have come to me asking for loans for their investments and business ventures.

But, of course, there’s no such thing as a sure bet and eight out of 10 start-ups fail. What happens if they can’t pay back the money they’ve borrowed? I never want to be put in that situation, which can cause grievous harm to a relationship.

So, my unbreakable rule is never to lend money to family. Instead, I gift it with the recipient’s understanding that by taking my money they forgo their right to ever again ask me for it.

If you follow this proven advice, you’ll likely retire comfortably and avoid the pitfalls that can derail your financial security.