Retirement Planning Services – Fox Valley
For anyone in "Generation X" - defined as people born between the mid-1960s and also the early 1980s - retirement planning sounds like something your mother and father or other "old people" might do. But you know what? With lots of "baby boomers" either already in the middle of retirement or observing it on the horizon, "Generation X" is definitely the next generation of folks to reach old age. Sure, it's still a ways off, but those in their 30s and 40s need to start centering their investment planning on retirement and making sure they've got the kind of retirement they are working hard to enjoy. Here are some tips on planning for retirement:
Retirement life in the future will be different than the retirement of today. It'll be much better in some ways, and worse somewhat. However, the retirement planning for today's workforce needs to be far different than it was in days gone by.
On the bright side, individuals 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 greater than 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 right now than a generation or two ago.
Social Security and Retiring - Fox Valley
On the downside, Social Security will probably be a far less reliable source of income than it is now. And the likelihood is slim-and getting slimmer each 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 previous employer. Increasingly more, retired people will need to rely on their financial savings to cover the costs of living and health insurance.
With people living longer and needing more cash to do so, retirement planning is a vital activity even for those people who are half way to the common retirement age of 65. It could be an intimidating task to plan for a few decades into the future, particularly with bills, rents and mortgages to pay today, but procrastinating won't make it any easier.
Putting even just a little bit of money now into a savings account that works as a retirement savings plan can pay off later on. The interest you receive on money in a savings account will allow your initial investments to grow to something sustainable. A savings account will provide a place where you can pile up capital earning a small interest rate until there is enough to invest in a reliable security which will yield you more like a municipal bond.
Another solid strategy which could surely and progressively build a nest egg is to put money into long-term bonds. On maturation of the bond, you'll get back your initial investment and also 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 which could provide a great foundation for retirement. And a municipal or government bond is really as safe an investment as you can ever make.
401K and IRA With Retirement - Fox Valley
Nevertheless, the best approach when it comes to retirement planning is to put money 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 option, an IRA is the next best thing. Money put into this account is tax deferred and may be tax-deductible, depending on how much is invested annually.
For more details, please feel free 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 Fox Valley area.
