Islanders with investments urged not to panic as Trump turmoil shakes the markets

Syed Imran Ali, a third-year student at the University of Prince Edward Island, started investing about six months ago.

Originally from Pakistan and attending UPEI's School of Sustainable Design Engineering, Ali said he wanted to prepare financially to build his life here on the Island.

"After graduation, a lot of the students would be looking into purchasing their first house, maybe their car, maybe starting up a family," he told CBC News. "It's very important for students in general to start saving early, especially if you're doing some part-time jobs, to save and invest them, so you can have it for your future."

But lately, Ali has been paying close attention to how the markets are performing.

Ups but mostly downs fueled by U.S. President Donald Trump's tariff threats have definitely shown up on his investment portfolio.

"I am actually invested in stocks and shares and mutual funds, and also I know a lot of my friends and relatives who are invested in different shares and mutual funds," he said. "I am personally concerned about the volatility in the financial market."

'Do not panic'

He is not alone. Financial adviser Paul Trainor said he's been hearing a lot of anxiety from Islanders these days about the impact of Trump's global trade war on their investments, including their RRSPs.

"Everybody's concerned about it," Trainor told CBC's Mainstreet P.E.I.

He said part of his role lately has been reassuring clients that short-term market drops are normal, and not a reason to act out of fear.

"Don't sell, because if you sell, somebody's going to buy it and make a good profit six months from now. So the big thing to get out to the public is 'Do not panic… It's going to be volatile, but it's going to settle,'" he said.

"You heard the old expression, you know, 'Buy low and sell high.' Well, right now it's a low environment. It's a great time to buy, for sure."

Trainor noted that stock markets always go through ups and downs. While short-term dips can be a cause for concern, the overall long-term trend of stock markets has historically been upward.

For people nearing retirement, Trainor said most financial advisers would recommend avoiding volatile markets altogether and investing instead in safer options like Guaranteed Investment Certificates, or GICs.

"Those funds are not going to really fluctuate that much," he said. "At 85, you wouldn't have put your investments in a volatile market."

'Get debt down'

With the U.S.-led trade war raising concerns about a global economic downturn, and possibly a recession, Trainor said people could keep their cool by focusing on what they can control: their own financial habits.

He said that includes buying local products over imported ones, which may become more expensive due to tariffs, and, importantly, managing debt.

Front Burner25:24What did Trump just do to the economy?

U.S. President Donald Trump announced a 90-day pause on much of what he calls "reciprocal tariffs" barely a week after first imposing them — while also implementing a 10 per cent tariff across the board on most countries, and a whopping 145 per cent tariff on China. Markets first soared at the news, then went back into freefall. Members of Trump's cabinet claimed this was the strategy all along. The chaos even brought the stability of U.S. government bonds into question. Justin Wolfers, a professor of economics at the University of Michigan, unpacks what's really going on here, and why Trump's past dealings with Canada could provide some insight into how it will all shake out. For transcripts of Front Burner, please visit: https://www.cbc.ca/radio/frontburner/transcripts [https://www.cbc.ca/radio/frontburner/transcripts]

Islanders should especially pay attention to credit-card debt, which has long been a problem for Canadians, he said.

"As a financial adviser, my first thing is get debt down... other than your mortgage and your car payments and stuff like that. But I'm talking about your credit cards, those types of things.

"And if you can concentrate on that, you can ride any type of volatility."

Time to buy a home?

Despite the shaky markets, Trainor, who is also a mortgage broker, said now might actually be a good time to enter the housing market, given that interest rates have been trending downward since last summer.

On Wednesday, the Bank of Canada held its key policy rate at 2.75 per cent — its first pause after seven consecutive cuts since it started bringing rates down in June 2024.

In addition to lower interest rates, Trainor pointed to government supports such as P.E.I.'s Down Payment Assistance Program, a pilot program to assist qualified residents of Prince Edward Island with modest incomes to buy a first home.

"We don't know how long those are gonna last," he said. "The reality is that it's a good time to buy, but I think the interest rates are still going to go down over the next six months.

"It's probably a good idea to really take your time to find that home that you might be able to talk down $10,000, $20,000 to get it into your budget and work with — if you don't have the down payment — work with the powers that be to get the assistance that you need and to get into a home."

He added that getting into the housing market is becoming more important these days, since rents are unlikely to go down in the years ahead.