Retirement Planning – Forest Park
For anyone in "Generation X" - described as folks born between the mid-1960s and also the early 1980s - retirement planning seems like something your parents or other "old people" would do. But you know what? With many "baby boomers" either already in the middle of retirement or observing it in the near future, "Generation X" stands out as the next generation of folks to reach retirement. Sure, it is still a ways off, but people in their 30s and 40s should begin focusing their investment planning on retirement and making sure they have the kind of retirement they are working so hard to have. Below are great tips on preparing for retirement:
Retirement life in the future will be different than the retirement of today. It will be much better in some ways, and worse in some ways. However, 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 four years more than the average life span in 1980. So investment planning for retirement has to account for an extended period of time now than a generation or two in the past.
Social Security and Retiring - Forest Park
On the downside, Social Security will probably be a far less dependable source of income 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 rely on their savings to pay for the costs of just living and medical health insurance.
With individuals living longer and needing more cash to do so, retirement planning is a vital activity even for those who are halfway to the standard retirement age of 65. It can be an intimidating task to plan for a few decades into the future, particularly with bills, housing costs and mortgages to pay today, but procrastinating won't make it any easier.
Placing even just a small amount of cash into a savings account that serves as a retirement savings plan can pay off later on. 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 acquire capital earning a small interest rate until there is enough to invest in a trusted security which will yield you more like a municipal bond.
Another solid approach that can certainly and progressively build a nest egg is to invest in long-term bonds. Upon maturation of the bond, you will get back your initial investment as well as all the interest that collected over the life 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 as safe an investment that you can ever make.
401K and IRA With Retirement - Forest Park
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 those for whom a 401K is not 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 information, please do not hesitate to contact GC Financial Advisors Ltd. at any time and we will be glad to help you! We offer 401K and IRA rollover and review services for folks in the Forest Park area.
