Retirement Planning Services – Melrose Park
For anyone in "Generation X" - described as people born between the mid-1960s and also the early 1980s - retirement planning sounds like something your parents or other "old people" might do. But guess what? With a lot of "baby boomers" either already in the midst of retirement or looking at it in the near future, "Generation X" is definitely the next generation of people to reach old age. Sure, it is still a ways off, but those in their 30s and 40s should start focusing their investment planning on retirement and making certain they've got the type of retirement they are working so hard to enjoy. Here are some tips on planning 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 days gone by.
On the bright side, people 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 4 years more than the average life span in 1980. So investment planning for retirement has to account for an extended period of time right now than a generation or two ago.
Social Security and Retirement - Melrose Park
On the down side, Social Security is going to be a far less trustworthy income source compared to now. And 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. More and more, retired people will have to rely on their savings to cover the expenses of just living and health insurance.
With people living for a longer time and needing more cash to do so, retirement planning is an essential activity even for those people who are halfway to the regular retirement age of 65. It could be an intimidating task to plan for a few decades into the future, especially with bills, rents and home loans to pay right now, but procrastinating won't make it any less difficult.
Putting even just a small amount of money now into a savings account which 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 preliminary investments to grow to something sustainable. A savings account will offer a place where you can build up capital earning a little interest rate until there is enough to invest in a reliable security that will yield you more like a municipal bond.
Another good approach that could certainly and progressively build a nest egg is to put money into long-term bonds. On maturation of the bond, you will get back your initial investment and also all the interest which collected over the lifetime of the bond. This is a tremendous amount of money for a 20- or 30-year bond-money that could provide a nice foundation for retirement. And a municipal or government bond is as safe an investment that you can ever make.
401K and IRA With Retirement - Melrose Park
Nonetheless, the best approach when it comes to retirement planning would be to put money in a 401K plan at work or in an IRA opened with an investment house. For those for whom a 401K isn't a retirement planning option, 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 info, 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 Melrose Park area.