Retirement Planning – Glendale Heights
For anyone in "Generation X" - described as people born between the mid-1960s and also the early 1980s - retirement planning may sound like something your mother and father or other "old people" would do. But guess what? With many "baby boomers" either already in the midst of retirement or looking at it on the horizon, "Generation X" is the next generation of individuals to reach old age. Sure, it is a ways off, but people in their 30s and 40s must begin centering their investment planning on retirement and making sure they've got the type of retirement they are working so hard to have. 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 somewhat. However, the retirement planning for today's labor force must be far different than it was in yesteryear.
On the bright side, folks 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 more 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 time of time right now than a generation or two ago.
Social Security and Retirement - Glendale Heights
On the down side, Social Security will probably be a far less dependable income source compared to now. And also the odds are 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 former employer. Increasingly more, retired persons will need to rely on their savings to cover the expenses of living and health insurance.
With people living for a longer time and needing extra money to do so, retirement planning is an essential activity even for those people who are halfway to the regular 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 easier.
Putting even just a small amount of money now into a savings account that functions as a retirement savings plan can pay off in the future. The interest you get 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 pile up capital earning a small interest rate until there's enough to invest in a reliable security that will yield you more like a municipal bond.
Another good strategy that may surely and steadily build a nest egg is to put money into long-term bonds. On 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 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 as safe an investment as you can ever make.
401K and IRA With Retirement - Glendale Heights
Nonetheless, the best approach when it comes to retirement planning would be to put cash in a 401K plan at work or in an IRA opened with an investment house. For people for whom a 401K is not a retirement planning option, an IRA is the next best thing. Money put in this account is tax deferred and may be tax-deductible, depending on how much is invested each year.
For more information, please feel free to contact GC Financial Advisors Ltd. at any time and we'll be happy to help you! We provide 401K and IRA rollover and review services for folks in the Glendale Heights area.
