Retirement Planning – Fort Sheridan
For those in "Generation X" - described as individuals born between the mid-1960s and the early 1980s - retirement planning may sound like something your mother and father or other "old people" would do. But guess what? With lots of "baby boomers" either already in the midst of retirement or observing it in the near future, "Generation X" is definitely the next generation of men and women to reach retirement. Sure, it's still a ways off, but people in their 30s and 40s ought to begin centering their investment planning on retirement and making sure they have the sort of retirement they are working so 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 will likely be far better in some ways, and worse in some ways. However, the retirement planning for today's labor force must be far different than it was in earlier times.
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 greater 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 now than a generation or two ago.
Social Security and Retiring - Fort Sheridan
On the downside, Social Security will likely be a far less reliable income source than it is 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 people will need to rely on their savings to pay for the costs of just living and 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 people who are halfway to the standard retirement age of 65. It can be a daunting task to plan for a few decades into the future, especially with bills, rents and home loans to pay right now, but procrastinating won't make it any less difficult.
Placing even just a little bit of money now into a savings account that works as a retirement savings plan can pay off later. 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 good strategy that may certainly and gradually build a nest egg is to put money into long-term bonds. On maturation of the bond, you will get back your initial investment along with 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 may 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 - Fort Sheridan
However, the best approach when it comes to retirement planning would be to put funds in a 401K plan at work or in an IRA opened with an investment house. For the people 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 info, please don't hesitate to contact GC Financial Advisors Ltd. at any time and we'll be happy to help you! We offer 401K and IRA rollover and review services for folks in the Fort Sheridan area.
