Retirement Planning Services – Itasca
For the people in "Generation X" - defined as people born between the mid-1960s and the early 1980s - retirement planning sounds like something your parents or other "old people" would do. But guess what? With a lot of "baby boomers" either already in the midst of retirement or observing it on the horizon, "Generation X" stands out as the next generation of individuals to reach old age. Sure, it's still a ways off, but people in their 30s and 40s should start centering their investment planning on retirement and making sure they've got the kind of retirement they are working so hard to enjoy. Below are great tips on preparing for retirement:
Retirement life in the foreseeable future will be different than the retirement in the present day. It will be much better in some ways, and worse in some ways. But, the retirement planning for today's labor force must be far different than it was in yesteryear.
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. So investment planning for retirement has to account for a longer period of time now than a generation or two in the past.
Social Security and Retirement - Itasca
On the down side, Social Security will probably 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 now will be able to rely on a work pension and enjoy lifetime benefits from their former workplace. Increasingly more, retirees will have to depend on their financial savings to pay for the expenses of just living and health insurance.
With people living for a longer time and needing more money to do so, retirement planning is an essential activity even for those people who are halfway to the standard retirement age of sixty-five. It can be an intimidating task to plan for a couple of decades into the future, especially with bills, rents and mortgages to pay right now, but procrastinating will not make it any less difficult.
Putting even just a little bit of cash into a savings account that serves 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 give you a place where you can pile up 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 solid strategy which could surely and progressively build a nest egg is to put money into long-term bonds. After maturation of the bond, you'll get back your initial investment and also all the interest that collected over the life of the bond. This is a significant 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 - Itasca
However, the best approach when it comes to retirement planning would be to put funds in a 401K plan at work or in an IRA opened with an investment house. For people for whom a 401K isn't a retirement planning option, 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 each year.
For more details, please don't hesitate to contact GC Financial Advisors Ltd. at any time and we'll be glad to help you! We offer 401K and IRA rollover and review services for individuals in the Itasca area.
