Retirement Planning – Glencoe, IL
For the people in "Generation X" - described as people born between the mid-1960s and 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 midst of retirement or observing it in the near future, "Generation X" stands out as the next generation of men and women to reach old age. Sure, it's still a ways off, but people in their 30s and 40s should begin focusing their investment planning on retirement and ensuring they've got the kind of retirement they are working hard to have. Here are some tips on preparing for retirement:
Retirement life in the future will be different than the retirement in the present day. It will likely be 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 yesteryear.
On the bright side, folks 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. Therefore investment planning for retirement has to account for a longer period of time right now than a generation or two ago.
Social Security and Retiring - Glencoe, IL
On the down side, Social Security will likely be a far less dependable 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 former workplace. Increasingly more, retired people will have to rely on their savings to cover the expenses of living and medical health insurance.
With people living for a longer time and needing more money to do so, retirement planning is an essential activity even for those people who are half way to the standard retirement age of sixty-five. It could be a daunting task to plan for a couple of decades into the future, particularly with bills, rents and home loans to pay right now, but procrastinating will not make it any less complicated.
Placing even just a small amount of money now into a savings account that serves as a retirement savings plan can pay off later. The interest you receive on money in a savings account will allow your initial investments to grow to something sustainable. A savings account will offer a place where you can accumulate 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 that can certainly and gradually build a nest egg is to put money into long-term bonds. Upon maturation of the bond, you'll get back your initial investment along with all the interest that collected over the lifetime of the bond. That's a significant amount of money for a 20- or 30-year bond-money that can 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 - Glencoe, IL
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 people for whom a 401K isn't a retirement planning choice, 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 each year.
For more information, please do not hesitate to contact GC Financial Advisors Ltd. at any time and we will be happy to help you! We offer 401K and IRA rollover and review services for folks in the Glencoe, IL area.
