Retirement Planning – Kenilworth
For anyone in "Generation X" - defined as individuals born between the mid-1960s and the early 1980s - retirement planning may sound like something your parents or other "old people" would do. But you know what? With lots of "baby boomers" either already in the midst of retirement or viewing it in the near future, "Generation X" is definitely the next generation of individuals to reach old age. Sure, it's still a ways off, but people in their 30s and 40s really need to start focusing their investment planning on retirement and making sure 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 in the present day. It'll be far better in some ways, and worse in some ways. But, the retirement planning for today's workforce must be far different than it was in days gone by.
On the bright side, people 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 4 years more than the average life span in 1980. Therefore investment planning for retirement has to account for a longer period of time now than a generation or two ago.
Social Security and Retirement - Kenilworth
On the downside, Social Security will probably be a far less dependable source of income compared to now. And also the likelihood is slim-and getting slimmer every year-that retirees 20 and 30 years from now will be able to rely on a work pension and enjoy lifetime benefits from their previous workplace. More and more, retirees will need to rely on their financial savings to pay for the expenses of just living and health insurance.
With folks 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 sixty-five. It may be a daunting task to plan for a few decades into the future, particularly with bills, rents and mortgages to pay right now, but procrastinating will not make it any less complicated.
Placing even just a little bit of money now into a savings account which functions as a retirement savings plan can pay off later on. 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 build up capital earning a little interest rate until there is enough to invest in a trusted security that will yield you more like a municipal bond.
Another good strategy which could 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 along with all the interest which collected over the life of the bond. This is a tremendous amount of money for a 20- or 30-year bond-money which could 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 - Kenilworth
Nonetheless, the best approach when it comes to retirement planning is to put money in a 401K plan at work or in an IRA opened with an investment house. For those 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 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'll be happy to help you! We offer 401K and IRA rollover and review services for individuals in the Kenilworth area.
