Retirement Planning – Wilmette, IL
For those in "Generation X" - defined 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 you know what? With lots of "baby boomers" either already in the middle of retirement or observing it on the horizon, "Generation X" is the next generation of folks to reach retirement. Sure, it is still a ways off, but people in their 30s and 40s really need to start focusing their investment planning on retirement and ensuring they've got the type of retirement they are working so hard to have. Here are some tips on planning 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 earlier times.
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 over 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 an extended period of time right now than a generation or two in the past.
Social Security and Retiring - Wilmette, IL
On the downside, Social Security is going to be a far less trustworthy source of income than it is 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 employer. Increasingly more, retired people will need to depend on their savings to pay for the expenses of just living and medical health insurance.
With folks living for a longer time and needing more money to do so, retirement planning is a vital activity even for those people who are half way to the regular retirement age of 65. It can be an intimidating task to plan for a few decades into the future, particularly with bills, housing costs and home loans to pay right now, but procrastinating will not make it any less difficult.
Placing even just a little bit of money now into a savings account that works as a retirement savings plan can pay off later on. The interest you receive on money in a savings account will allow your initial investments to grow to something sustainable. A savings account will provide a place where you can acquire capital earning a small interest rate until there's enough to invest in a trusted security which will yield you more like a municipal bond.
Another good strategy that may certainly and steadily build a nest egg is to invest in long-term bonds. Upon maturation of the bond, you will get back your initial investment along with all the interest that collected over the life of the bond. That's a significant amount of money for a 20- or 30-year bond-money that may provide a good foundation for retirement. And a municipal or government bond is as safe an investment as you can ever make.
401K and IRA With Retirement - Wilmette, IL
Nevertheless, 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 those for whom a 401K is not 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 annually.
For more info, please don't hesitate to contact GC Financial Advisors Ltd. at any time and we will be happy to help you! We provide 401K and IRA rollover and review services for individuals in the Wilmette, IL area.
