Retirement Planning Services – Cicero
For the people in "Generation X" - described as people 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 many "baby boomers" either already in the middle of retirement or looking at it on the horizon, "Generation X" is the next generation of individuals to reach old age. Sure, it's still a ways off, but those in their 30s and 40s will need to start focusing their investment planning on retirement and ensuring they have the kind of retirement they are working so hard to enjoy. Here are some tips on preparing for retirement:
Retirement life in the future will be different than the retirement right now. It will likely 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 yesteryear.
On the bright side, people are living longer than ever. As of not too long 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 ago.
Social Security and Retirement - Cicero
On the downside, Social Security will likely be a far less dependable income source than it is now. And 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 previous workplace. More and more, retired persons will have to rely on their financial savings to pay for the costs of just living and health insurance.
With people living for a longer time and needing more cash to do so, retirement planning is a vital activity even for those who are halfway to the regular retirement age of sixty-five. It may be an intimidating 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 easier.
Putting even just a little bit of cash 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 preliminary investments to grow to something sustainable. A savings account will give you a place where you can accumulate capital earning a small interest rate until there is enough to invest in a trusted security that will yield you more like a municipal bond.
Another good strategy which could certainly and steadily build a nest egg is to invest in long-term bonds. Upon maturation of the bond, you'll get back your initial investment along with all the interest which collected over the lifetime of the bond. This is a tremendous 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 as safe an investment as you can ever make.
401K and IRA With Retirement - Cicero
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 those for whom a 401K isn't a retirement planning option, an IRA is the next best thing. Money put into this account is tax deferred and might be tax-deductible, depending on how much is invested annually.
For more information, please don't hesitate 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 individuals in the Cicero area.
