Retirement Planning Services – Broadview
For the people in "Generation X" - defined as folks born between the mid-1960s and also the early 1980s - retirement planning sounds like something your mother and father or other "old people" would do. But you know what? With lots of "baby boomers" either already in the middle of retirement or observing it on the horizon, "Generation X" stands out as the next generation of people to reach old age. Sure, it is a ways off, but people in their 30s and 40s have to start focusing their investment planning on retirement and making sure they have the sort of retirement they are working hard to enjoy. Here are some tips on preparing for retirement:
Retirement life in the foreseeable future will be different than the retirement of today. It'll be better in some ways, and worse somewhat. However, the retirement planning for today's workforce needs to be far different than it was in earlier times.
On the bright side, people 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 more than 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 time of time now than a generation or two ago.
Social Security and Retirement - Broadview
On the downside, Social Security will likely be a far less reliable source of income compared to now. And also the odds are slim-and getting slimmer every 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, retired persons will have to rely on their savings to pay for the expenses of just living and medical health insurance.
With individuals living for a longer time and needing more money to do so, retirement planning is a vital activity even for those people who are halfway to the regular 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 home loans to pay right now, but procrastinating will not make it any less complicated.
Putting 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 offer a place where you can pile up capital earning a little interest rate until there is enough to invest in a trusted security which will yield you more like a municipal bond.
Another good approach which could surely and steadily build a nest egg is to put money into long-term bonds. After maturation of the bond, you will get back your initial investment along with all the interest which collected over the life of the bond. This is a considerable amount of money for a 20- or 30-year bond-money which could 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 - Broadview
However, the best approach when it comes to retirement planning is to put cash in a 401K plan at your workplace or in an IRA opened with an investment house. For the people for whom a 401K is not a retirement planning choice, an IRA is the next best thing. Money placed in this account is tax deferred and might be tax-deductible, depending on how much is invested every year.
For more details, please feel free to contact GC Financial Advisors Ltd. at any time and we'll be glad to help you! We offer 401K and IRA rollover and review services for folks in the Broadview area.
