Retirement Planning – Forest Park
For the people in "Generation X" - described as people 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 many "baby boomers" either already in the middle of retirement or observing it in the near future, "Generation X" is definitely the next generation of individuals to reach old age. Sure, it is still a ways off, but people in their 30s and 40s really need to start centering their investment planning on retirement and ensuring they've got the sort of retirement they are working so hard to enjoy. Here are some tips on preparing for retirement:
Retirement life in the future will be different than the retirement right now. It'll be better in some ways, and worse somewhat. But, the retirement planning for today's workforce needs to be far different than it was in days gone by.
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 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 a longer time of time now than a generation or two ago.
Social Security and Retiring - Forest Park
On the downside, Social Security will probably be a far less dependable source of income compared to now. And the likelihood is slim-and getting slimmer each year-that retirees 20 and 30 years from now will be able to rely on a work pension and enjoy lifetime benefits from their previous workplace. Increasingly more, retired people will need to depend on their savings to cover the costs of just living and health insurance.
With individuals living for a longer time and needing additional money to do so, retirement planning is a vital activity even for those who are half way to the regular retirement age of 65. It may be a daunting task to plan for a couple of decades into the future, particularly with bills, housing costs and home loans to pay today, but procrastinating will not make it any less difficult.
Placing even just a little bit of cash into a savings account which works as a retirement savings plan can pay off later on. The interest you get on money in a savings account will allow your initial investments to grow to something sustainable. A savings account will offer a place where you can acquire 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 approach that can certainly and progressively build a nest egg is to invest in long-term bonds. Upon maturation of the bond, you'll get back your initial investment and also all the interest which collected over the life of the bond. This is a tremendous amount of money for a 20- or 30-year bond-money that can 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 - Forest Park
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 the people for whom a 401K isn't a retirement planning choice, an IRA is the next best thing. Money put in this account is tax deferred and might be tax-deductible, depending on how much is invested each year.
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 Forest Park area.
