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Retirement Planning – Naperville, Illinois

For those in "Generation X" - defined as individuals born between the mid-1960s and also the early 1980s - retirement planning may sound like something your mother and father or other "old people" would do. But guess what? With a lot of "baby boomers" either already in the middle of retirement or looking at it in the near future, "Generation X" is the next generation of people to reach retirement. Sure, it is still a ways off, but people in their 30s and 40s have to start focusing their investment planning on retirement and making certain they've got the sort of retirement they are working so hard to enjoy. Below are great tips on preparing for retirement:

Retirement life in the foreseeable future will be different than the retirement in the present day. It will likely be much better in some ways, and worse in some ways. But, the retirement planning for today's workforce must be far different than it was in days gone by.

On the bright side, people are living longer than ever. As of a few years 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 4 years more than the average life span in 1980. Therefore investment planning for retirement has to account for a longer time of time right now than a generation or two back.

Social Security and Retirement - Naperville, Illinois

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 previous employer. Increasingly more, retirees will need to depend on their savings to cover the costs of just living and medical health insurance.

With individuals living for a longer time and needing extra money to do so, retirement planning is an essential activity even for those who are halfway to the regular retirement age of 65. It could be a daunting task to plan for a few decades into the future, especially with bills, rents and home loans to pay right now, but procrastinating will not make it any easier.

Putting even just a small amount of cash into a savings account that works as a retirement savings plan can pay off in the future. The interest you get on money in a savings account will allow your preliminary investments to grow to something sustainable. A savings account will give you a place where you can accumulate capital earning a small interest rate until there's enough to invest in a reliable security which will yield you more like a municipal bond.

Another solid approach that may surely 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 as well as all the interest that collected over the life of the bond. This is a considerable amount of money for a 20- or 30-year bond-money that may provide a great foundation for retirement. And a municipal or government bond is as safe an investment as you can ever make.

401K and IRA - Naperville, Illinois

Nevertheless, 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 don't hesitate to contact GC Financial Advisors Ltd. at any time and we will be glad to help you! We offer 401K and IRA rollover and review services for folks in the Naperville, Illinois area.

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