Retirement Planning – Melrose Park
For anyone in "Generation X" - described as folks born between the mid-1960s and the early 1980s - retirement planning may sound like something your mother and father or other "old people" would do. But guess what? With many "baby boomers" either already in the midst of retirement or viewing it on the horizon, "Generation X" is the next generation of men and women to reach retirement. Sure, it is still a ways off, but people in their 30s and 40s should start focusing their investment planning on retirement and making certain they've got the type of retirement they are working so hard to have. Here are some tips on planning for retirement:
Retirement life in the foreseeable future will be different than the retirement in the present day. It'll be better in some ways, and worse in some ways. But, the retirement planning for today's workforce needs to be far different than it was in the past.
On the bright side, people are living longer than ever. As of a few years ago, the average life span of an American was 77.9 years, exactly 2.5 years more than the average life span in 1990 and more than four years more than the average life span in 1980. So investment planning for retirement has to account for an extended period of time right now than a generation or two ago.
Social Security and Retiring - Melrose Park
On the down side, Social Security will probably be a far less reliable income source compared to now. And the odds are slim-and getting slimmer each year-that retirees 20 and 30 years from right now will be able to rely on a work pension and enjoy lifetime benefits from their former employer. More and more, retired people will need to depend on their financial savings to cover the costs of just living and medical health insurance.
With people living for a longer time and needing more cash to do so, retirement planning is an essential activity even for those who are half way to the common retirement age of sixty-five. It could be an intimidating task to plan for a few decades into the future, especially with bills, rents and mortgages to pay today, but procrastinating will not make it any easier.
Placing even just a little bit of cash into a savings account that serves as a retirement savings plan can pay off later on. The interest you receive on money in a savings account will allow your preliminary investments to grow to something sustainable. A savings account will supply a place where you can accumulate capital earning a small interest rate until there's enough to invest in a trusted security which will yield you more like a municipal bond.
Another good approach that can certainly and progressively build a nest egg is to invest in long-term bonds. On maturation of the bond, you'll get back your initial investment along with all the interest that collected over the lifetime of the bond. That's a tremendous amount of money for a 20- or 30-year bond-money that can provide a good foundation for retirement. And a municipal or government bond is really as safe an investment as you can ever make.
401K and IRA With Retirement - Melrose Park
Nevertheless, the best approach when it comes to retirement planning would be to put cash in a 401K plan at work or in an IRA opened with an investment house. For the people for whom a 401K is not a retirement planning option, an IRA is the next best thing. Money put into this account is tax deferred and might be tax-deductible, depending on how much is invested every year.
For more info, please feel free to contact GC Financial Advisors Ltd. at any time and we will be happy to help you! We offer 401K and IRA rollover and review services for folks in the Melrose Park area.
