Retirement Planning Company – La Grange Park
For anyone in "Generation X" - described as people born between the mid-1960s and the early 1980s - retirement planning may sound like something your parents or other "old people" would do. But guess what? With lots of "baby boomers" either already in the middle of retirement or looking at it in the near future, "Generation X" will be the next generation of people to reach retirement. Sure, it's still a ways off, but those in their 30s and 40s will need to start focusing their investment planning on retirement and making sure they've got the type of retirement they are working 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 will be better in some ways, and worse somewhat. However, the retirement planning for today's labor force needs to 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 greater than the average life span in 1990 and more than 4 years more than the average life span in 1980. So investment planning for retirement has to account for an extended period of time now than a generation or two in the past.
Social Security and Retiring - La Grange Park
On the down side, Social Security will probably be a far less reliable source of income than it is now. And also the odds are 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 former workplace. More and more, retired persons will have to depend on their savings to pay for the costs of just living and medical health insurance.
With folks living for a longer time and needing more money to do so, retirement planning is a vital activity even for those people who are half way to the regular retirement age of 65. It may be an intimidating task to plan for a few decades into the future, especially with bills, housing costs and mortgages to pay today, but procrastinating will not make it any less difficult.
Placing 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 receive on money in a savings account will allow your preliminary investments to grow to something sustainable. A savings account will give you a place where you can accumulate 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 solid strategy that can surely and progressively build a nest egg is to put money into long-term bonds. After maturation of the bond, you'll get back your initial investment and also all the interest which collected over the life of the bond. This is 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 really as safe an investment as you can ever make.
401K and IRA With Retirement - La Grange Park
However, the best approach when it comes to retirement planning would be to put money in a 401K plan at work or in an IRA opened with an investment house. For the people for whom a 401K is not a retirement planning option, an IRA is the next best thing. Money put into this account is tax deferred and might be tax-deductible, depending on how much is invested each year.
For more details, please don't 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 La Grange Park area.
