Retirement Planning Services – Fox Valley
For the people in "Generation X" - described as folks born between the mid-1960s and the early 1980s - retirement planning sounds like something your mother and father or other "old people" might do. But you know what? With lots of "baby boomers" either already in the midst of retirement or looking at it in the near future, "Generation X" is definitely the next generation of folks to reach retirement. Sure, it's still a ways off, but those in their 30s and 40s have to begin centering their investment planning on retirement and ensuring they've got the sort of retirement they are working so hard to have. Here are some 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 workforce needs to be far different than it was in yesteryear.
On the bright side, folks 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 four 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 Retiring - Fox Valley
On the downside, Social Security is going to be a far less trustworthy income source 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 former employer. Increasingly more, retired persons will need to depend on their financial savings to cover the costs of just 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 half way to the common retirement age of 65. It may be an intimidating task to plan for a few decades into the future, especially with bills, rents and home loans to pay today, but procrastinating won't make it any less difficult.
Placing even just a little bit of cash into a savings account that functions 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 supply a place where you can pile up capital earning a little interest rate until there's enough to invest in a reliable security that will yield you more like a municipal bond.
Another solid strategy that can certainly and progressively build a nest egg is to invest in long-term bonds. On maturation of the bond, you'll 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 can provide a nice foundation for retirement. And a municipal or government bond is really as safe an investment that you can ever make.
401K and IRA With Retirement - Fox Valley
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 the people for whom a 401K is not a retirement planning option, 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 info, please do not hesitate to contact GC Financial Advisors Ltd. at any time and we'll be glad to help you! We provide 401K and IRA rollover and review services for folks in the Fox Valley area.
