Retirement Planning – Lake Forest, IL
For those in "Generation X" - described as folks born between the mid-1960s and the early 1980s - retirement planning may sound 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 observing it on the horizon, "Generation X" will be the next generation of folks 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 ensuring they've got the sort 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 in the present day. It'll be far better in some ways, and worse in some ways. However, the retirement planning for today's labor force needs to be far different than it was in yesteryear.
On the bright side, folks 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 over 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 right now than a generation or two in the past.
Social Security and Retiring - Lake Forest, IL
On the downside, Social Security will likely be a far less reliable income source compared to now. And also 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. Increasingly more, retirees will have to rely on their financial savings to cover the expenses of just living and health insurance.
With folks living longer and needing more cash to do so, retirement planning is a vital activity even for those people who are halfway to the common retirement age of sixty-five. It could be an intimidating task to plan for a few decades into the future, especially with bills, housing costs and home loans to pay right now, but procrastinating won't make it any less difficult.
Putting even just a small amount of cash into a savings account that serves as a retirement savings plan can pay off in the future. The interest you receive on money in a savings account will allow your initial investments to grow to something sustainable. A savings account will give you a place where you can pile 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 solid strategy which could certainly and gradually 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 that collected over the lifetime of the bond. This is a considerable amount of money for a 20- or 30-year bond-money which could provide a great foundation for retirement. And a municipal or government bond is really as safe an investment that you can ever make.
401K and IRA - Lake Forest, IL
Nevertheless, the best approach when it comes to retirement planning is to put cash in a 401K plan at your workplace or in an IRA opened with an investment house. For people 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 may 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 will be happy to help you! We offer 401K and IRA rollover and review services for individuals in the Lake Forest, IL area.
