Retirement Planning – Lyons
For anyone 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" might do. But guess what? With many "baby boomers" either already in the middle of retirement or viewing it in the near future, "Generation X" will be the next generation of individuals to reach old age. Sure, it's still a ways off, but those in their 30s and 40s must start focusing their investment planning on retirement and making certain they have the kind of retirement they are working hard to enjoy. Here are some tips on preparing for retirement:
Retirement life in the foreseeable future will be different than the retirement in the present day. It'll be better in some ways, and worse somewhat. However, 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 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 an extended period of time right now than a generation or two back.
Social Security and Retiring - Lyons
On the downside, Social Security will likely be a far less trustworthy income source than it is now. And also the likelihood is slim-and getting slimmer each 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 previous employer. More and more, retired people will have to depend on their savings to pay for the costs of living and medical health insurance.
With individuals living for a longer time and needing additional money to do so, retirement planning is a vital activity even for those who are halfway to the regular retirement age of sixty-five. It can be a daunting task to plan for a few decades into the future, particularly with bills, housing costs and mortgages to pay today, but procrastinating won't make it any less difficult.
Putting even just a small amount of money now into a savings account which works as a retirement savings plan can pay off later. The interest you receive on money in a savings account will allow your preliminary investments to grow to something sustainable. A savings account will offer a place where you can accumulate capital earning a little interest rate until there is enough to invest in a trusted security which will yield you more like a municipal bond.
Another good approach that may certainly 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 and also all the interest which collected over the lifetime of the bond. That's a tremendous amount of money for a 20- or 30-year bond-money that may 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 - Lyons
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 the people for whom a 401K is not a retirement planning option, 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 annually.
For more information, please do not hesitate to contact GC Financial Advisors Ltd. at any time and we'll be glad to help you! We provide 401K and IRA rollover and review services for folks in the Lyons area.
