Retirement Planning – Markham
For anyone in "Generation X" - defined as people born between the mid-1960s and also the early 1980s - retirement planning sounds like something your mother and father or other "old people" would do. But you know what? With lots 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 people to reach retirement. Sure, it's still a ways off, but those in their 30s and 40s should start centering their investment planning on retirement and making sure they have the sort 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 of today. It'll be much 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 days gone by.
On the bright side, individuals 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 4 years more than the average life span in 1980. So investment planning for retirement has to account for a longer time of time right now than a generation or two back.
Social Security and Retiring - Markham
On the downside, Social Security will likely be a far less reliable source of income compared to now. And 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 workplace. Increasingly more, retired persons will have to rely on their financial savings to cover the expenses of living and health insurance.
With individuals 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 sixty-five. It can 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.
Placing even just a little bit of money now into a savings account that works 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 accumulate capital earning a little interest rate until there's enough to invest in a reliable security which will yield you more like a municipal bond.
Another good approach which could surely and steadily build a nest egg is to invest in long-term bonds. On maturation of the bond, you'll get back your initial investment as well as all the interest that collected over the lifetime of the bond. That's a considerable amount of money for a 20- or 30-year bond-money which could provide a good foundation for retirement. And a municipal or government bond is really as safe an investment that you can ever make.
401K and IRA - Markham
Nonetheless, the best approach when it comes to retirement planning is to put money in a 401K plan at your workplace or in an IRA opened with an investment house. For the people for whom a 401K isn't 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 will be glad to help you! We provide 401K and IRA rollover and review services for individuals in the Markham area.
