Retirement Planning Company – Lake Bluff
For anyone in "Generation X" - described as folks born between the mid-1960s and also the early 1980s - retirement planning seems like something your parents or other "old people" would do. But guess what? With a lot of "baby boomers" either already in the middle of retirement or looking at it in the near future, "Generation X" is definitely the next generation of men and women to reach retirement. Sure, it is a ways off, but people in their 30s and 40s should begin focusing their investment planning on retirement and making certain they have the kind of retirement they are working hard to have. Here are some tips on preparing for retirement:
Retirement life in the foreseeable future will be different than the retirement right now. It will likely be far better in some ways, and worse somewhat. However, the retirement planning for today's workforce needs to be far different than it was in days gone by.
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 more 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 an extended period of time right now than a generation or two back.
Social Security and Retiring - Lake Bluff
On the downside, Social Security will probably be a far less reliable income source than it is now. And the odds are 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. Increasingly more, retirees will need 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 a vital activity even for those who are halfway to the regular retirement age of sixty-five. It may be a daunting task to plan for a couple of decades into the future, particularly with bills, rents and mortgages to pay right now, but procrastinating will not make it any less difficult.
Placing even just a small amount of money now 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 preliminary investments to grow to something sustainable. A savings account will provide a place where you can pile up capital earning a small 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 surely and gradually build a nest egg is to invest in long-term bonds. On maturation of the bond, you will get back your initial investment as well as all the interest that collected over the lifetime of the bond. That's a significant amount of money for a 20- or 30-year bond-money that can provide a good foundation for retirement. And a municipal or government bond is really as safe an investment that you can ever make.
401K and IRA - Lake Bluff
Nonetheless, the best approach when it comes to retirement planning would be to put funds in a 401K plan at your workplace or in an IRA opened with an investment house. For people for whom a 401K is not a retirement planning option, an IRA is the next best thing. Money put in this account is tax deferred and may be tax-deductible, depending on how much is invested every year.
For more details, please don't hesitate to contact GC Financial Advisors Ltd. at any time and we will be happy to help you! We offer 401K and IRA rollover and review services for individuals in the Lake Bluff area.
