I’m a Financial Expert: 7 Best Areas To Invest Your Money If You Think Trump Will Win the Election
Written by
G. Brian Davis
Edited by
Cynthia Measom
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Donald Trump and Kamala Harris have distinctly different visions for how the American economy should be managed and regulated.
So, if you believe Trump will sit in the Oval Office for the next four years, how should you invest your money today to reap the highest returns?
Domestic Oil and Gas
Melanie Musson, a finance expert with InsuranceProviders.com, doesn’t mince words: “Invest in the American petroleum and drilling industry.”
“When President Trump was in office before, America was energy independent thanks to friendly drilling and fracking regulations,” she said. “Everything associated with the industry will grow in the US from local economies in fracking states to oil companies to refineries.”
And sure enough, Trump has hammered this message home on the campaign trail. Three words say it all: “Drill baby drill.”
“If you think Trump will win, now is a great time to make an investment in the traditional energy industry,” Musson added.
Domestic Manufacturers Serving American Consumers
Donald Trump famously loves tariffs as a protectionist policy for American manufacturers. His campaign has proposed a 10% blanket tariff on all imported goods and a 60% tariff on Chinese imports, as reported by CNBC.
That would make American manufacturers’ pricing more competitive — but only here in the US. Abroad, other countries with competing goods would likely retaliate with similar tariffs.
Look for companies who build and sell within US borders, but who have struggled to compete with cheap Chinese imports over the last decade.
Large Corporations With a Domestic Market
“Large corporations are always a relatively safe investment,” notes Musson. “But with Trump’s promised tax cuts for corporations, they will have more resources available to invest in themselves and grow their business and profits.”
But as touched on above, watch out for companies that rely too heavily on exporting abroad. If Trump does push through his tariff plan, US corporations who primarily export to other countries may find themselves fighting an uphill battle against counter-tariffs.
Large corporations who serve the domestic market first and foremost can enjoy lower tax rates without worrying about retaliatory tariffs overseas.
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Defense Contractors
Donald Trump aims to project the strength of America’s military to both domestic and foreign audiences.
For that matter, Republicans have historically favored higher defense spending than Democrats. One analysis of 15 presidential defense budgets by the American Enterprise Institute found that, on average, Republican administrations raise defense spending by $46.3 billion while Democratic administrations reduce it by $8.2 billion.
Consider investing in major defense contractors like Northrop Grumman and Lockheed Martin if you foresee a second Trump presidency.
Gold and Precious Metals
Some analysts worry about the unpredictability of Trump’s policies and foreign relations. For example, Alan Wm. Wolff wrote for the Peterson Institute for International Economics about the risk of Trump’s proposed 60% tariff on China plunging the two countries into a trade war.
Where do investors seek refuge from geopolitical uncertainty? In a word: gold. It has served as a safe haven asset for millennia, and shows no signs of stopping.
Fixed-Interest Investments for Seniors
Paul Tyler of annuity provider Zinnia also sees instability as a risk under Trump and urges seniors and Americans approaching retirement to invest defensively.
“Artificially low interest rates usually reduce the spending power — and longevity — of retirement nest eggs. Tariffs also drive up prices and living expenses,” he explained. “As a hedge against this scenario, it makes sense for some seniors to invest for today’s higher guaranteed interest rates with bonds, long-term CDs and annuities in the next few months.”
Roth Contributions and Conversions
On the campaign trail, Trump has touted his signature Tax Cuts and Jobs Act of 2017 legislation and proposed making the tax cuts permanent. Most of the changes are currently scheduled to expire at the end of 2025.
Take advantage of the current era’s relatively low tax rates by contributing to a Roth retirement account. You pay taxes on contributions now, but your investments then compound tax-free, and you’ll pay no taxes on withdrawals in retirement. Beyond simply contributing up to this year’s limits, consider converting some of your traditional retirement account funds to Roth accounts.
Scott Sturgeon, CFP and senior wealth advisor at Oread Wealth, urges investors to focus more on tax strategy than trying to predict the next hot sector based on public policy. “While it’s not the most exciting strategy, a diversified portfolio of low-cost index funds serves as a great approach for tax-advantaged retirement accounts.”
Given that the Congressional Budget Office projects that the federal debt will leap from 99% of GDP in 2024 to 116% by 2034, many financial analysts foresee higher tax rates on the horizon. Knock out your retirement tax obligations over the next few years to avoid higher tax rates by the time you retire.
Final Thoughts
People love to prognosticate that the economy will collapse or boom if one candidate or another wins. But Americans should focus on simply continuing to invest consistently no matter which way the political pendulum swings.
Sturgeon wraps it up like this: “In the end, the most important investment you can make is ensuring you’ve built a financial plan that’s versatile enough to help you achieve your goals in life — a plan that isn’t materially influenced by politics or other noise.”
Editor’s note on election coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. For more coverage on this topic, please check out I’m an Investor: 8 Stocks You Should Buy If You Think Harris May Win the Election.
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