Retirement Planning – Melrose Park, Illinois
For the people in "Generation X" - defined as folks born between the mid-1960s and also the early 1980s - retirement planning seems like something your parents or other "old people" would do. But you know what? With many "baby boomers" either already in the middle of retirement or viewing it in the near future, "Generation X" is the next generation of men and women to reach old age. Sure, it is a ways off, but those in their 30s and 40s need to start focusing their investment planning on retirement and making sure they have the type 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 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 yesteryear.
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 more 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 an extended period of time now than a generation or two back.
Social Security and Retirement - Melrose Park, Illinois
On the down side, Social Security is going to be a far less dependable income source compared to now. And the likelihood is 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 previous employer. More and more, retired persons will need to rely on their savings to pay for the expenses of living and medical health insurance.
With individuals living for a longer time and needing more cash to do so, retirement planning is an essential activity even for those people who are half way 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 mortgages to pay right now, but procrastinating won't make it any less difficult.
Putting even just a little bit of money now into a savings account that works as a retirement savings plan can pay off later. The interest you receive on money in a savings account will allow your initial investments to grow to something sustainable. A savings account will supply a place where you can build 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 invest in long-term bonds. Upon maturation of the bond, you'll get back your initial investment along with all the interest that collected over the lifetime of the bond. That's a significant amount of money for a 20- or 30-year bond-money which could provide a nice foundation for retirement. And a municipal or government bond is as safe an investment as you can ever make.
401K and IRA - Melrose Park, Illinois
However, the best approach when it comes to retirement planning is to put funds in a 401K plan at your workplace or in an IRA opened with an investment house. For people for whom a 401K isn't a retirement planning option, an IRA is the next best thing. Money put in this account is tax deferred and may be tax-deductible, depending on how much is invested each year.
For more info, please do not 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 Melrose Park, Illinois area.
