Retirement Planning – Elmwood Park
For anyone in "Generation X" - described as people born between the mid-1960s and also the early 1980s - retirement planning seems 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 in the near future, "Generation X" is definitely the next generation of individuals to reach old age. Sure, it's still a ways off, but those in their 30s and 40s ought to begin centering their investment planning on retirement and making sure they've got the type 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'll be much better in some ways, and worse in some ways. But, the retirement planning for today's workforce needs to be far different than it was in days gone by.
On the bright side, folks 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 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 period of time now than a generation or two back.
Social Security and Retirement - Elmwood Park
On the down side, Social Security will probably 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. Increasingly more, retired persons will need to depend on their savings to cover the costs of living and health insurance.
With people living longer and needing more money to do so, retirement planning is an essential activity even for those people who are halfway to the regular retirement age of 65. It can be an intimidating task to plan for a few decades into the future, particularly with bills, rents and home loans to pay right now, but procrastinating won't make it any easier.
Putting even just a small amount of money now into a savings account which functions 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 pile up 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 may certainly and progressively build a nest egg is to put money into long-term bonds. Upon maturation of the bond, you will get back your initial investment as well as 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 may 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 - Elmwood Park
Nonetheless, 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 those 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 each year.
For more information, please don't hesitate to contact GC Financial Advisors Ltd. at any time and we will be glad to help you! We provide 401K and IRA rollover and review services for folks in the Elmwood Park area.
