Retirement Planning – Barrington, IL
For those in "Generation X" - described as folks born between the mid-1960s and also the early 1980s - retirement planning sounds like something your parents or other "old people" would do. But you know what? With lots of "baby boomers" either already in the midst of retirement or viewing it in the near future, "Generation X" will be the next generation of people to reach old age. Sure, it's still a ways off, but those in their 30s and 40s will need to begin centering their investment planning on retirement and ensuring they've got the kind of retirement they are working hard to have. Below are great tips on preparing for retirement:
Retirement life in the foreseeable future will be different than the retirement of today. It will likely be much better in some ways, and worse in some ways. However, the retirement planning for today's labor force must 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 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 period of time right now than a generation or two in the past.
Social Security and Retirement - Barrington, IL
On the down side, Social Security is going to be a far less reliable source of income compared to now. And the likelihood is 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 depend on their financial savings to pay for the costs of just living and health insurance.
With folks living for a longer time and needing extra money to do so, retirement planning is an essential activity even for those who are half way to the regular retirement age of 65. It may be an intimidating task to plan for a couple of decades into the future, particularly with bills, housing costs and mortgages to pay right now, but procrastinating won't make it any easier.
Putting even just a small amount of money now into a savings account that functions as a retirement savings plan can pay off later. The interest you get 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 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 good approach that may certainly and steadily build a nest egg is to put money into 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 lifetime of the bond. This is a significant 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 that you can ever make.
401K and IRA With Retirement - Barrington, IL
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 put into this account is tax deferred and may be tax-deductible, depending on how much is invested each year.
For more details, please feel free 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 Barrington, IL area.
