Retirement Planning Company – Aurora
For anyone in "Generation X" - defined as individuals born between the mid-1960s and also the early 1980s - retirement planning may sound like something your parents or other "old people" would do. But guess what? With many "baby boomers" either already in the middle of retirement or observing it in the near future, "Generation X" stands out as the next generation of men and women to reach old age. Sure, it's still a ways off, but people in their 30s and 40s must begin centering their investment planning on retirement and making sure they have the kind of retirement they are working hard to have. Below are great tips on preparing for retirement:
Retirement life in the foreseeable future will be different than the retirement of today. It will be better in some ways, and worse somewhat. But, the retirement planning for today's workforce must be far different than it was in yesteryear.
On the bright side, folks are living longer than ever. As of a short while ago, the average life span of an American was 77.9 years, exactly 2.5 years over the average life span in 1990 and more than 4 years more than the average life span in 1980. Therefore investment planning for retirement has to account for a longer time of time now than a generation or two back.
Social Security and Retirement - Aurora
On the downside, Social Security is going to be a far less reliable source of income compared to now. And the likelihood is slim-and getting slimmer each year-that retirees 20 and 30 years from now will be able to rely on a work pension and enjoy lifetime benefits from their previous workplace. More and more, retired persons will have to depend on their financial savings to cover the expenses of living and health insurance.
With folks living for a longer time and needing more money to do so, retirement planning is a vital activity even for those people who are half way to the standard retirement age of 65. It can be a daunting task to plan for a few decades into the future, especially with bills, housing costs and home loans to pay today, but procrastinating will not make it any less difficult.
Putting even just a small amount of money now into a savings account which works 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 provide a place where you can build up capital earning a small interest rate until there is enough to invest in a reliable security that will yield you more like a municipal bond.
Another solid strategy that can certainly and gradually build a nest egg is to put money into long-term bonds. After maturation of the bond, you'll get back your initial investment along with all the interest which collected over the life of the bond. This is a significant 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 as safe an investment as you can ever make.
401K and IRA - Aurora
Nonetheless, the best approach when it comes to retirement planning is 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 isn't a retirement planning choice, an IRA is the next best thing. Money put in this account is tax deferred and may be tax-deductible, depending on how much is invested each year.
For more info, please feel free to contact GC Financial Advisors Ltd. at any time and we'll be glad to help you! We provide 401K and IRA rollover and review services for folks in the Aurora area.
