Retirement Planning – Berwyn, IL
For those in "Generation X" - defined as folks born between the mid-1960s and the early 1980s - retirement planning may sound like something your parents or other "old people" might do. But you know what? With a lot of "baby boomers" either already in the middle of retirement or looking at it on the horizon, "Generation X" will be the next generation of individuals to reach retirement. Sure, it's still a ways off, but people in their 30s and 40s ought to start focusing their investment planning on retirement and making sure they have the sort of retirement they are working hard to have. Here are some tips on preparing for retirement:
Retirement life in the foreseeable future will be different than the retirement of today. It will be far better in some ways, and worse somewhat. However, the retirement planning for today's labor force must be far different than it was in yesteryear.
On the bright side, individuals 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 greater 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 a longer time of time now than a generation or two in the past.
Social Security and Retiring - Berwyn, IL
On the down side, Social Security is going to be a far less trustworthy income source than it is now. And the odds are 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 employer. More and more, retirees will have to depend on their financial savings to pay for 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 who are half way to the regular retirement age of 65. It can 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 less difficult.
Placing even just a little bit of money now into a savings account that works as a retirement savings plan can pay off in the future. The interest you get on money in a savings account will allow your preliminary investments to grow to something sustainable. A savings account will offer a place where you can accumulate capital earning a small interest rate until there's enough to invest in a reliable security which will yield you more like a municipal bond.
Another good approach that can certainly and gradually build a nest egg is to invest in long-term bonds. After maturation of the bond, you will get back your initial investment and also all the interest that collected over the lifetime of the bond. That's a considerable 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 really as safe an investment as you can ever make.
401K and IRA - Berwyn, IL
Nevertheless, the best approach when it comes to retirement planning would be to put funds in a 401K plan at your workplace or in an IRA opened with an investment house. For people for whom a 401K isn't a retirement planning option, an IRA is the next best thing. Money placed in this account is tax deferred and may be tax-deductible, depending on how much is invested every year.
For more details, please do not hesitate to contact GC Financial Advisors Ltd. at any time and we'll be happy to help you! We provide 401K and IRA rollover and review services for individuals in the Berwyn, IL area.
