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President Donald Trump’s trade war with China and his pronouncements about tariffs have been rocking the stock market and investors.
Now, with a 15% tariff on $109 billion in Chinese imports taking effect September 1, and an additional $155 billion in goods scheduled to be subject to the same 15% levy on December 15, the hit to consumers is becoming all too apparent. (Those new rounds are in addition to a 25% tariff--that Trump has said will rise to 30% on October 1---on another $250 billion in Chinese imports.)
In a letter to clients last week, JP Morgan estimated that as the prices on common goods imported from China rise, the tariff war will cost households an average of $1,000 annually. Though the first round of tariffs on things like clothes, food and condiments go into effect in September, there’s still time to purchase other goods before their prices’ climb. Indeed, Trump said he chose to delay those tariffs until mid-December “for Christmas season, just in case some of the tariffs would have an impact on U.S. customers.”
Here are 7 things to buy before the December 15th round of tariffs go into effect: (for a full list of items affected by the December tariffs, click here):
The shoes on your feet — they were probably made in China. An estimated 99% of shoes in the United States are from China. The tariffs specifically target waterproof footwear, golf shoes, sports footwear, slip-ons, removable insoles and more. There are 56 shoe-type products in total that will face new tariffs.
The list of clothing articles facing new tariffs includes everything from bathrobes to shirts to suits to socks. The tariffs cover clothes for both children and adults. Even winter clothing, such as gloves, are on the tariff hit list. Hockey fans aren’t even safe, as tariffs will be applied to “ice hockey and field hockey gloves, knitted or crocheted, impregnated, coated or covered with plastics or rubber.”
3. Cell Phones, Laptops and Other Tech Gear
Lots of tech gear is also on the December tariff list. Those items include cell phones and laptops, keyboards, computer monitors, headphones and speakers. All could see prices rise as the tariffs go into effect.
This also means Apple fans should consider making their big purchases now to avoid hikes on these already-expensive products. President Trump has openly challenged Apple, taking to Twitter to assert that the company will not be getting a tariff waiver. “Make them in the USA, no Tariffs!’’ he tweeted. Some sources estimate the price of iPhones will jump as much as 10% as a direct result of the tariffs.
4. Baby Essentials
If you’re an expecting parent or already have small children, loading up on diapers before Dec. 15th could be a good idea. According to the tariff list, baby diapers of knitted or crocheted cotton, synthetic fibers or textile silk materials will be affected. New or expecting parents will also want to secure high chairs and booster seats before tariffs go into effect. Other related products that will be hit by the tariffs include bouncers, swings and walkers — all staples for the first years of a child’s life.
5. Holiday Items
Some items on the tariff list are everyday items you might not even think of as imported from China, such as greeting cards. If you’re old-school and still enjoy sending snail-mail for birthdays or holidays, it could get more expensive to do so. According to the official list, “Printed cards (except postcards) bearing personal greetings, messages or announcements, with or without envelopes or trimmings,’’ wll face new tariffs. Those who celebrate Christmas will see their tinsel, ornaments and nativity-scene decorations become more expensive after mid-December.
6. Personal Care Products
Your daily hygiene routine isn’t safe from the tariffs, either, particularly if you have long hair you want to straighten or dry. Electrothermic hair dryers and electric flatirons (including both travel and regular editions) are both on the list. Consumers can also expect items such as hairbrushes, nail brushes, makeup brushes, combs and hair accessories to become more costly.
7. Household Essentials
Everyday household items, including microwaves, clocks, curtains, scales, electric blankets, ceiling fans, household laundry machines, bedspreads and more will be subject to the December round of tariffs.
If You’re Rushing To Buy, Remember The Rewards...
Whether you’re loading up on items before the December tariffs go into effect--or just doing your regular Christmas shopping-- remember that cash back and rewards credit cards can help you earn money or a reward for each dollar you spend. Keep in mind, however, that utilizing the right card for purchases is important. Not all credit cards are created equal, and maximizing credit card rewards can take some planning. If, for example, you intend to buy a new iPhone or Mac, you can get 3% back using the new Apple credit card. (Don’t feel like you need to spend all those rewards. Read how saving and investing your rewards dollars can add up through the years, big time.)
And Think About The Future
Of course, it’s still uncertain if President Trump will follow through with all the tariffs, raise them even higher, or strike a tariff-reducing trade deal with China. At the G7 summit this week, the President expressed regret over the tariffs; his aides, however, later said that what he regretted was not raising them faster. So who knows?
Plus, you may want to consider your spending in the context of the prospects for the broader economy. Chris Shaker, partner and consumer products senior analyst at RSM, a global network of independent audit, tax and consulting firms, says even if more items aren’t subject to tariffs, the trade war will also hurt consumers in terms of wages and employment. He cites factors such as slowed total income growth and the supply chain’s need to reduce labor costs as the culprits.
“Even if there are some products that don’t see a direct increase in cost, the consumers still may feel the pain in the form of lower wages,” Shaker says.