Retirement Planning – Kenilworth
For anyone in "Generation X" - described as people 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 viewing it in the near future, "Generation X" is the next generation of individuals to reach old age. Sure, it is still a ways off, but those in their 30s and 40s must begin centering their investment planning on retirement and making sure they have the sort of retirement they are working so hard to have. Here are some tips on planning for retirement:
Retirement life in the future will be different than the retirement right now. It'll be far better in some ways, and worse in some ways. But, the retirement planning for today's labor force needs to be far different than it was in yesteryear.
On the bright side, individuals 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 period of time now than a generation or two in the past.
Social Security and Retirement - Kenilworth
On the down side, Social Security will probably be a far less reliable income source than it is 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 workplace. Increasingly more, retired persons will need to rely on their savings to pay for the costs of living and health insurance.
With folks living for a longer time and needing more cash to do so, retirement planning is a vital activity even for those who are halfway to the common retirement age of sixty-five. It may be an intimidating task to plan for a couple of decades into the future, particularly with bills, rents and mortgages to pay today, but procrastinating will not make it any less difficult.
Putting even just a little bit 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 preliminary investments to grow to something sustainable. A savings account will provide 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 approach that could surely and steadily build a nest egg is to invest in long-term bonds. After maturation of the bond, you will 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 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 - Kenilworth
Nevertheless, 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 is not a retirement planning choice, 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 each year.
For more info, please feel free 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 Kenilworth area.
