Retirement Planning – Kenilworth
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 middle of retirement or viewing it in the near future, "Generation X" stands out as the next generation of men and women to reach old age. Sure, it is still a ways off, but those in their 30s and 40s have to begin focusing their investment planning on retirement and making sure they have the kind of retirement they are working hard to have. Here are some tips on planning for retirement:
Retirement life in the foreseeable future will be different than the retirement of today. It will be much better in some ways, and worse somewhat. However, the retirement planning for today's workforce needs to 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 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 time of time right now than a generation or two ago.
Social Security and Retirement - Kenilworth
On the downside, Social Security is going to be a far less reliable income source compared to now. And the odds are 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 previous workplace. More and more, retired persons will have to depend on their financial savings to pay for the expenses of living and medical health insurance.
With people living for a longer time and needing additional money to do so, retirement planning is an essential activity even for those who are halfway to the standard retirement age of sixty-five. It may be an intimidating task to plan for a couple of decades into the future, especially with bills, housing costs and mortgages to pay right now, but procrastinating will not make it any less complicated.
Putting even just a small amount of cash into a savings account that serves as a retirement savings plan can pay off later. 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 acquire capital earning a little interest rate until there is enough to invest in a reliable security that will yield you more like a municipal bond.
Another good strategy that can certainly and progressively build a nest egg is to invest in long-term bonds. On maturation of the bond, you'll get back your initial investment as well as all the interest that collected over the lifetime of the bond. That's a tremendous amount of money for a 20- or 30-year bond-money that can provide a great foundation for retirement. And a municipal or government bond is as safe an investment as you can ever make.
401K and IRA With Retirement - Kenilworth
Nevertheless, 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 the people for whom a 401K isn't a retirement planning option, an IRA is the next best thing. Money put in this account is tax deferred and might be tax-deductible, depending on how much is invested every year.
For more information, please don't hesitate to contact GC Financial Advisors Ltd. at any time and we'll be glad to help you! We offer 401K and IRA rollover and review services for individuals in the Kenilworth area.
