Retirement Planning Company – Harwood Heights
For anyone in "Generation X" - defined as individuals born between the mid-1960s and the early 1980s - retirement planning seems like something your parents or other "old people" would do. But you know what? With many "baby boomers" either already in the midst of retirement or observing it in the near future, "Generation X" is definitely the next generation of individuals to reach old age. Sure, it is still a ways off, but people in their 30s and 40s ought to start centering their investment planning on retirement and making certain they've got the kind of retirement they are working so hard to enjoy. Below are great tips on preparing for retirement:
Retirement life in the foreseeable future will be different than the retirement of today. It'll be much 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 the past.
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 more 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 a longer time of time now than a generation or two back.
Social Security and Retiring - Harwood Heights
On the downside, Social Security will likely be a far less trustworthy income source compared to now. And also the odds are slim-and getting slimmer each 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. Increasingly more, retired people will have to rely on their financial savings to cover the expenses of living and medical health insurance.
With individuals living longer and needing more money to do so, retirement planning is a vital activity even for those people who are halfway to the common retirement age of sixty-five. It could be an intimidating task to plan for a couple of decades into the future, particularly with bills, rents and home loans to pay right now, but procrastinating won't make it any less difficult.
Putting even just a small amount of cash into a savings account that serves as a retirement savings plan can pay off later on. The interest you get on money in a savings account will allow your initial investments to grow to something sustainable. A savings account will give you a place where you can accumulate 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 solid approach that could certainly and progressively build a nest egg is to put money into long-term bonds. Upon maturation of the bond, you will get back your initial investment along with all the interest that collected over the lifetime of the bond. This is a considerable amount of money for a 20- or 30-year bond-money that could 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 - Harwood Heights
However, 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 into this account is tax deferred and may be tax-deductible, depending on how much is invested every year.
For more info, please feel free 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 Harwood Heights area.
