UK pension payments could be slashed by 20% due to Donald Trump

UK pensioners may face a staggering 20% cut in their income due to Donald Trump's tariffs, the Society of Pension Professionals (SPP) has warned.

The imposition of tariffs by the Trump administration is sending shockwaves across the globe, including the UK, potentially impacting Defined Contribution (DC) pensions that rely on invested funds.

An SPP paper paints a severe outlook for those with DC pensions following the expansive tariffs introduced by Trump, reports .

The document reveals: "Given the scale of the equity market falls since early April 2025, and the fall in government bond yields, it is possible that some DC savers may see a reduction in retirement income of up to 20 per cent".

Simon Daniel, Chair of the SPP's Investment Committee expressed concerns, stating: "The world is again enduring a period of financial turbulence and this has naturally created some uncertainty for UK savers and investors."

Daniel went further, advising: "The overall message from this paper is that making significant, reactive changes to pensions and other savings is generally not ideal compared with keeping a cool head and planning carefully."

Dr Steve Dunne, a PhD Researcher and Associate Tutor at The University of Warwick, added: "Across the opening 100 days of his second term, Trump has devastated - perhaps irreparably - economic confidence in the US. In the short term, decreased economic trust will prolong market volatility. April 3-4 saw the largest-ever two-day loss, as US$6.6trillion (£5trillion) was erased from US stocks.

Trump's tariffs are also expected to depress growth, both at home and abroad. He further warned: "In the longer term, diminished economic trust will continue to weaken bond markets, hampering America's ability to service its colossal national debt.

"Perhaps most significantly, declining global trust will accelerate processes of de-dollarisation and reduce reliance on the dollar as a reserve currency. De-dollarisation would leave the US economically marginalised in a more multipolar global economy."

This analysis follows Mike Pence's critique of Trump's trade policies and inconsistent support for Ukraine. The former vice-president cautioned on CNN that Trump's tariff policy could trigger a "price shock" and potential shortages, potentially leading to public demand for a change in approach. Pence also took aim at the White House's fluctuating stance on Ukraine, countering Trump's statements by asserting that President Vladimir Putin of Russia 'doesn't want peace'.