Retirement Planning Company – La Grange, Illinois
For anyone in "Generation X" - defined as people born between the mid-1960s and the early 1980s - retirement planning sounds like something your mother and father or other "old people" might do. But guess what? With a lot of "baby boomers" either already in the middle of retirement or looking at it on the horizon, "Generation X" will be the next generation of men and women to reach old age. Sure, it's still a ways off, but people in their 30s and 40s must start centering their investment planning on retirement and ensuring they've got the sort of retirement they are working so hard to enjoy. Here are some tips on preparing for retirement:
Retirement life in the future will be different than the retirement of today. It'll be much better in some ways, and worse in some ways. But, the retirement planning for today's workforce needs to be far different than it was in earlier times.
On the bright side, folks 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 4 years more than the average life span in 1980. Therefore investment planning for retirement has to account for a longer period of time right now than a generation or two in the past.
Social Security and Retirement - La Grange, Illinois
On the downside, Social Security will likely be a far less trustworthy source of income compared to now. And the odds are slim-and getting slimmer every 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 former workplace. More and more, retired people will need to rely on their financial savings to pay for the costs of just living and health insurance.
With folks living longer and needing extra money to do so, retirement planning is an essential activity even for those who are halfway to the standard retirement age of 65. It can be an intimidating task to plan for a few decades into the future, particularly with bills, housing costs and home loans to pay today, but procrastinating will not make it any less difficult.
Putting even just a small amount of money now into a savings account which functions as a retirement savings plan can pay off in the future. 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 build up capital earning a little interest rate until there's enough to invest in a reliable security that will yield you more like a municipal bond.
Another solid strategy that can surely and gradually build a nest egg is to put money into long-term bonds. After maturation of the bond, you will get back your initial investment and also all the interest which collected over the lifetime of the bond. That's a significant 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 - La Grange, Illinois
However, the best approach when it comes to retirement planning would be to put money in a 401K plan at your workplace 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 placed in this account is tax deferred and might be tax-deductible, depending on how much is invested each year.
For more details, please feel free 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 folks in the La Grange, Illinois area.
