Retirement Planning Company – Chicago
For those in "Generation X" - defined as individuals 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 lots of "baby boomers" either already in the midst of retirement or observing it on the horizon, "Generation X" stands out as the next generation of men and women to reach old age. Sure, it is still a ways off, but people in their 30s and 40s need to start focusing their investment planning on retirement and making sure they have the type 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 in the present day. It will be better in some ways, and worse in some ways. However, 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 4 years more than the average life span in 1980. Therefore 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 - Chicago
On the down side, Social Security will probably be a far less trustworthy income source compared to now. And also the odds are slim-and getting slimmer every 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. Increasingly more, retirees will need to rely on their financial savings to cover the expenses of just living and medical health insurance.
With folks living for a longer time and needing additional money to do so, retirement planning is a vital activity even for those who are half way to the standard retirement age of 65. It could be an intimidating task to plan for a couple of decades into the future, particularly with bills, rents and mortgages to pay today, but procrastinating won't make it any easier.
Placing even just a small amount of money now into a savings account that works as a retirement savings plan can pay off later on. The interest you get on money in a savings account will allow your initial investments to grow to something sustainable. A savings account will supply a place where you can acquire capital earning a little interest rate until there's enough to invest in a trusted security which will yield you more like a municipal bond.
Another good strategy that can certainly and steadily build a nest egg is to put money into long-term bonds. After maturation of the bond, you'll get back your initial investment as well as all the interest that collected over the life of the bond. This is 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 that you can ever make.
401K and IRA With Retirement - Chicago
However, 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 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 annually.
For more information, please feel free 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 Chicago area.
