Trump pauses 25% tariffs days before next Bank of Canada rate announcement: Canadians still need to safeguard their finances during these unpredictable times — here's how

Trudeau responds with tariffs on $155 billion worth of American goods

Prime Minister Justin Trudeau formally addressed the nation about the tariffs on Tuesday morning, saying, “This is a very dumb thing to do. We two friends fighting is exactly what our opponents around the world want to see.”

Trudeau also outlined the federal government’s retaliatory agenda, levying tariffs on $155 billion of American goods, $30 billion of which would be imposed immediately, with the rest becoming effective in 21 days.

“They’ve chosen to launch a trade war that will, first and foremost, harm American families. They’ve chosen to sabotage their own agenda that was supposed to usher in a new golden age for the United States,” the Prime Minister said.

Provincial leaders are also reacting with austerity measures, as Ontario, Newfoundland and Labrador and Manitoba announced they will be removing US booze from their shelves, effective immediately.

Ontario Premier Doug Ford also announced that the province will be levying a 25% tariff on energy exports to the United States.

Canadians are largely supportive of retaliatory action, with 45% revealing they are strongly in favour, and another 25% saying they are somewhat in favour, according to a poll from Leger.

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How tariffs will impact Canadian consumers and investors

For consumers, tariffs will increase prices on imported goods. If a tariff is imposed on a product coming from the US, businesses will pass those added costs onto shoppers through price hikes.

Alternatively, companies may source from other countries or shift to domestic alternatives, which may not always be available at the same price or quality.

For investors, tariffs create uncertainty in markets. Companies that rely on cross-border trade, like manufacturers, retailers and agricultural businesses can see costs rise, potentially affecting profitability and stock performance. In fact, Canada's main stock index dropped nearly 500 points in early trading since the tariffs went into effect.

On the other hand, Canadian companies in protected industries, such as dairy or steel, may benefit from reduced foreign competition.

How to safeguard your finances during economic uncertainty

Canadians enjoyed a modicum of relief in the form of lower interest rates and from rising inflation in the last number of months. But that relief, it appears, was short lived.

The hard hitting tariffs are likely to cause significant impact the daily lives of Canadians, bringing to an end what was a short-lived period of a bit more breathing room in our wallets.

It may be time, again, to batten down the hatches and take pro-active measures to protect your property and interests, your investments and your debt load. No matter the current state of your finances, the aim of these tariffs is to make Canadians, across the board, feel the pinch.

Thankfully, there are options to help you cut down on your expenses, manage your cashflow and safeguard, to the best your ability, against the impact of Trump's tarrifs. We've put together a guide to help you protect your finances and reduce your losses in this new tariff environment.

A balance transfer credit card can lower interest payments

For many, credit card debt can be crippling, enabling an endless cycle of accruing interest and deflecting payments towards that interest instead of paying down the principal.

However, for those looking to find a less costly method to pay down this type of debt, a balance transfer card can help.

Balance transfer cards allow you to consolidate your higher interest debt into one lower monthly payment, which can help you reduce what you pay to interest and help you tackle the principal.

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Do more with your spending with a cashback credit card

Certain expenses are inevitable, such as groceries and gas, so why not earn money when spending on the necessities?

As one of the most popular credit card rewards options, cashback cards can help maximize your earnings on everyday purchases, stretching your budget further for other things like savings or investing.

We’ve compiled a list of the best cashback credit cards available in Canada to help. Browse the various options to see which one is suitable for your budget and spending habits.

Debt consolidation loans can keep payments lower and more manageable

The thought of having debt can be disquieting in times of economic upheaval, but it doesn’t have to feel like that.

If you feel like a hamster in a wheel when in comes to interest payments, a debt consolidation loan may be the answer.

A debt consolidation loan can help pay off debt from previous loans, overdue bills, credit card balances and any other outstanding payments due. Debt consolidation loans in Canada are available for both private and business use, and they're a good way to settle an unstable financial situation by offering a single payment at a single, ideally lower interest rate.

Here's a list of the best debt consolidation loans available in Canada right now.

Look into refinancing your mortgage

Now that interest rates have retreated somewhat, now may be a good time to look into refinancing your mortgage and lowering your monthly payment.

Homeowners in Canada with a good credit score are financially sound and have a significant amount of home equity are eligible for mortgage refinancing.

Browse the current refinancing rates in Canada and see how much you can potentially save money every month on your mortgage payment.

Budget with a pro with a budgeting app

The first step in recalibrating your financial situation is by learning how to spend more wisely. However, sometimes it can be hard to stay on track of all of your expenses without feeling overwhelmed or defeated.

Enter budgeting apps. Budgeting apps can help keep you on top of your spending and savings goals, and even help you invest automatically.

We’ve compiled a list of the best budgeting apps in Canada for you. See which option best suits your needs and financial situation and goals.

Take advantage of lower stock prices

The effects of tariffs are already being felt, both in Canada and the US.

A popular investment strategy during stock market downturns is called “buying the dip,” which essentially encourages buying an asset when the price has declined.

Buying the dip increases an investor’s position, which can result in higher returns if prices increase.

If this reactionary investment strategy appeals to you, look to one of Canada’s best trading platforms to get a head start on any market plunges.

However, be careful that if stock prices continue to fall, this will result in even more losses.

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The bottom line

Though the Bank of Canada is projected to hold rates steady at the March 12 announcement, it's possible the BoC will reconsider in light of the tariffs coming into effect. Time will tell. What we do know for sure is that these tariffs are aimed at taking away the very thing lower interest rates gave us — financial breathing room.

Thankfully, we as Canadians are not helpless. Making just a few of the changes recommended in our guide will hopefully help offer some relief in these economically uncertain times.