Retirement Planning Company – Lake Zurich
For anyone in "Generation X" - defined as folks born between the mid-1960s and also the early 1980s - retirement planning may sound 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 on the horizon, "Generation X" will be the next generation of folks to reach retirement. Sure, it is still a ways off, but people in their 30s and 40s will need to begin focusing their investment planning on retirement and ensuring they have the type of retirement they are working hard to enjoy. Here are some tips on planning for retirement:
Retirement life in the foreseeable future will be different than the retirement of today. It'll be much better in some ways, and worse somewhat. However, the retirement planning for today's labor force must be far different than it was in the past.
On the bright side, individuals are living longer than ever. As of a few years 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 period of time now than a generation or two ago.
Social Security and Retiring - Lake Zurich
On the down side, Social Security is going to be a far less trustworthy source of income compared to now. And also the odds are 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, retired persons will need to rely on their financial savings to pay for 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 who are half way to the common retirement age of sixty-five. It can be a daunting task to plan for a few decades into the future, especially with bills, housing costs and home loans to pay today, but procrastinating won't make it any easier.
Placing even just a little bit of money now into a savings account that serves as a retirement savings plan can pay off later. The interest you receive 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 accumulate capital earning a small interest rate until there is enough to invest in a reliable security which will yield you more like a municipal bond.
Another solid approach that could surely and gradually build a nest egg is to invest in long-term bonds. Upon maturation of the bond, you'll get back your initial investment as well as all the interest that collected over the lifetime of the bond. That's a tremendous amount of money for a 20- or 30-year bond-money that could 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 Zurich
However, the best approach when it comes to retirement planning is to put funds in a 401K plan at work or in an IRA opened with an investment house. For those 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 each year.
For more info, please do not hesitate to contact GC Financial Advisors Ltd. at any time and we will be glad to help you! We offer 401K and IRA rollover and review services for individuals in the Lake Zurich area.
