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Retirement Planning – Bartlett

For the people in "Generation X" - defined as people born between the mid-1960s and 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 midst of retirement or observing it in the near future, "Generation X" is the next generation of folks to reach retirement. Sure, it is a ways off, but people in their 30s and 40s need to begin focusing their investment planning on retirement and making sure they've got the type of retirement they are working hard to enjoy. Here are some tips on planning for retirement:

Retirement life in the foreseeable future will be different than the retirement right now. It'll be much better in some ways, and worse in some ways. But, the retirement planning for today's labor force needs to be far different than it was in the past.

On the bright side, folks 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 over the average life span in 1990 and more than 4 years more than the average life span in 1980. So investment planning for retirement has to account for a longer period of time now than a generation or two ago.

Social Security and Retiring - Bartlett

On the down side, Social Security will likely be a far less reliable income source than it is now. And also 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 former workplace. More and more, retirees will have to rely on their savings to cover the costs of just living and medical health insurance.

With folks living for a longer time and needing extra money to do so, retirement planning is an essential activity even for those people who are halfway to the common retirement age of 65. It may be a daunting task to plan for a couple of decades into the future, particularly with bills, rents and mortgages to pay right now, but procrastinating will not make it any easier.

Placing even just a small amount of money now into a savings account which serves as a retirement savings plan can pay off in the future. The interest you receive on money in a savings account will allow your initial investments to grow to something sustainable. A savings account will provide a place where you can acquire capital earning a little interest rate until there is enough to invest in a trusted security that will yield you more like a municipal bond.

Another good approach that can surely 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 and also all the interest which collected over the life of the bond. That's a significant amount of money for a 20- or 30-year bond-money that can provide a nice foundation for retirement. And a municipal or government bond is as safe an investment that you can ever make.

401K and IRA With Retirement - Bartlett

However, the best approach when it comes to retirement planning would be to put funds 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 in this account is tax deferred and may be tax-deductible, depending on how much is invested annually.

For more info, please do not hesitate to contact GC Financial Advisors Ltd. at any time and we will be happy to help you! We provide 401K and IRA rollover and review services for folks in the Bartlett area.

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