Retirement Planning – Hometown
For anyone in "Generation X" - described as individuals born between the mid-1960s and the early 1980s - retirement planning seems like something your mother and father or other "old people" would do. But guess what? With a lot 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 individuals to reach retirement. Sure, it is a ways off, but people in their 30s and 40s must begin focusing their investment planning on retirement and making certain 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 right now. It will be far 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 days gone by.
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 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 now than a generation or two ago.
Social Security and Retiring - Hometown
On the down side, Social Security will probably be a far less trustworthy source of income than it is now. And the likelihood is 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 need to rely on their financial savings to pay for the costs of just living and health insurance.
With people living for a longer time and needing more money to do so, retirement planning is a vital activity even for those who are half way to the regular retirement age of 65. It could be an intimidating task to plan for a few decades into the future, especially 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 cash into a savings account which functions 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 supply a place where you can pile up capital earning a small interest rate until there is enough to invest in a trusted security which will yield you more like a municipal bond.
Another good strategy that may surely and gradually build a nest egg is to invest in long-term bonds. After maturation of the bond, you'll get back your initial investment as well as all the interest which 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 that you can ever make.
401K and IRA - Hometown
Nevertheless, 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 details, please do not hesitate to contact GC Financial Advisors Ltd. at any time and we will be glad to help you! We offer 401K and IRA rollover and review services for individuals in the Hometown area.
