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Retirement Planning Services – Glen Ellyn

For anyone in "Generation X" - defined as individuals born between the mid-1960s and also the early 1980s - retirement planning sounds like something your parents or other "old people" might do. But guess what? With a lot of "baby boomers" either already in the middle of retirement or observing it on the horizon, "Generation X" will be the next generation of folks to reach old age. Sure, it's still a ways off, but those in their 30s and 40s really need to begin focusing their investment planning on retirement and making certain 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 foreseeable 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 days gone by.

On the bright side, people are living longer than ever. As of a short while 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 right now than a generation or two back.

Social Security and Retirement - Glen Ellyn

On the downside, Social Security will probably be a far less reliable income source than it is now. And also the likelihood is slim-and getting slimmer every 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 workplace. Increasingly more, retirees will need to rely on their savings to cover the costs of just living and medical health insurance.

With folks living longer and needing extra money to do so, retirement planning is a vital activity even for those people who are half way to the standard retirement age of 65. It can be an intimidating task to plan for a couple of decades into the future, especially with bills, housing costs and home loans to pay today, but procrastinating will not make it any less complicated.

Placing even just a little bit of money now into a savings account which 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 build up capital earning a small interest rate until there's enough to invest in a trusted security that will yield you more like a municipal bond.

Another good approach that can 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 life of the bond. This is a tremendous 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 really as safe an investment as you can ever make.

401K and IRA With Retirement - Glen Ellyn

However, the best approach when it comes to retirement planning is to put cash 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 choice, an IRA is the next best thing. Money placed in this account is tax deferred and might be tax-deductible, depending on how much is invested each year.

For more details, please do not hesitate to contact GC Financial Advisors Ltd. at any time and we'll be glad to help you! We provide 401K and IRA rollover and review services for folks in the Glen Ellyn area.

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