Retirement Planning – Lincolnwood, Illinois
For those in "Generation X" - described as folks born between the mid-1960s and the early 1980s - retirement planning sounds like something your parents or other "old people" would do. But you know what? With a lot of "baby boomers" either already in the midst of retirement or viewing it on the horizon, "Generation X" is the next generation of folks to reach old age. Sure, it's still a ways off, but people in their 30s and 40s should start focusing their investment planning on retirement and making certain they've got the sort of retirement they are working hard to have. Here are some tips on preparing for retirement:
Retirement life in the future will be different than the retirement right now. It will 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 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 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 Retiring - Lincolnwood, Illinois
On the downside, Social Security will probably be a far less trustworthy 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 previous workplace. Increasingly more, retired people will have to rely on their savings to cover the costs of just living and health insurance.
With folks living longer and needing additional money to do so, retirement planning is an essential activity even for those who are halfway to the common retirement age of 65. It may be an intimidating task to plan for a couple of decades into the future, especially with bills, housing costs and home loans to pay right now, but procrastinating won't make it any less complicated.
Putting even just a small amount of cash 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 give you a place where you can pile up capital earning a small interest rate until there's enough to invest in a trusted security that will yield you more like a municipal bond.
Another good strategy that could surely and steadily build a nest egg is to invest in long-term bonds. Upon maturation of the bond, you'll get back your initial investment as well as all the interest which collected over the life of the bond. That's a tremendous amount of money for a 20- or 30-year bond-money that 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 - Lincolnwood, Illinois
Nevertheless, the best approach when it comes to retirement planning would be to put funds 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 placed in this account is tax deferred and may be tax-deductible, depending on how much is invested each year.
For more information, 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 Lincolnwood, Illinois area.
