Retirement Planning – Willow Springs
For those in "Generation X" - defined as folks born between the mid-1960s and the early 1980s - retirement planning seems like something your mother and father or other "old people" might do. But you know what? With many "baby boomers" either already in the midst of retirement or viewing it in the near future, "Generation X" stands out as the next generation of people to reach retirement. Sure, it is still a ways off, but those in their 30s and 40s have to start focusing their investment planning on retirement and making sure they have the type of retirement they are working hard to have. Below are great tips on planning 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 somewhat. But, the retirement planning for today's labor force needs to be far different than it was in the past.
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 more than the average life span in 1990 and more than four 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 - Willow Springs
On the down side, Social Security will likely be a far less reliable 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 former employer. Increasingly more, retired persons will have to rely on their financial savings to pay for the costs of just living and medical health insurance.
With individuals living for a longer time and needing more money to do so, retirement planning is an essential activity even for those people who are halfway to the standard retirement age of sixty-five. It may be a daunting 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 difficult.
Placing even just a small amount of money now into a savings account that functions 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 supply a place where you can pile up capital earning a small 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 progressively build a nest egg is to put money into long-term bonds. On maturation of the bond, you'll get back your initial investment along with all the interest that collected over the lifetime of the bond. This is a tremendous amount of money for a 20- or 30-year bond-money which could provide a great foundation for retirement. And a municipal or government bond is as safe an investment that you can ever make.
401K and IRA - Willow Springs
Nevertheless, the best approach when it comes to retirement planning would be to put funds 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 every year.
For more information, please feel free 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 folks in the Willow Springs area.
