Retirement Planning – Bensenville, Illinois
For anyone in "Generation X" - defined as individuals born between the mid-1960s and also the early 1980s - retirement planning sounds like something your mother and father or other "old people" might do. But you know what? With a lot of "baby boomers" either already in the middle of retirement or looking at it on the horizon, "Generation X" stands out as the next generation of people to reach retirement. Sure, it's still a ways off, but those in their 30s and 40s need 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 preparing for retirement:
Retirement life in the foreseeable future will be different than the retirement of today. It'll be better in some ways, and worse somewhat. However, the retirement planning for today's labor force needs to be far different than it was in days gone by.
On the bright side, folks 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 a longer period of time right now than a generation or two in the past.
Social Security and Retiring - Bensenville, Illinois
On the down side, Social Security is going to be a far less dependable source of income than it is 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 previous employer. Increasingly more, retired persons will have to depend on their financial savings to pay for the expenses of living and medical health insurance.
With people living longer and needing additional money to do so, retirement planning is an essential activity even for those people who are halfway to the common retirement age of 65. It can be an intimidating task to plan for a couple of decades into the future, especially with bills, housing costs and mortgages to pay today, but procrastinating won't make it any less complicated.
Putting even just a little bit of cash into a savings account that functions 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 give you a place where you can accumulate 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 solid strategy which could certainly and steadily build a nest egg is to invest in long-term bonds. Upon 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 considerable amount of money for a 20- or 30-year bond-money which could provide a nice foundation for retirement. And a municipal or government bond is as safe an investment as you can ever make.
401K and IRA With Retirement - Bensenville, Illinois
However, the best approach when it comes to retirement planning is to put money in a 401K plan at work 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 might be tax-deductible, depending on how much is invested every year.
For more information, please don't hesitate to contact GC Financial Advisors Ltd. at any time and we will be glad to help you! We provide 401K and IRA rollover and review services for individuals in the Bensenville, Illinois area.
