Retirement Planning – Mchenry Cary, IL
For anyone in "Generation X" - described as individuals born between the mid-1960s and also the early 1980s - retirement planning seems like something your mother and father or other "old people" would do. But you know what? With many "baby boomers" either already in the midst of retirement or looking at it on the horizon, "Generation X" is definitely the next generation of men and women to reach old age. Sure, it is a ways off, but people in their 30s and 40s need to start focusing their investment planning on retirement and making sure they've got the kind of retirement they are working hard to have. Here are some tips on planning for retirement:
Retirement life in the future will be different than the retirement right now. It will be far better in some ways, and worse in some ways. But, 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 a few years 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. Therefore 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 - Mchenry Cary, IL
On the downside, Social Security is going to be a far less trustworthy source of income 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, retired persons will need to depend on their financial savings to cover the costs of just living and health insurance.
With folks living longer and needing more cash to do so, retirement planning is a vital activity even for those people who are half way to the regular retirement age of sixty-five. It may be a daunting task to plan for a couple of decades into the future, especially with bills, rents and home loans to pay today, but procrastinating will not make it any less difficult.
Placing even just a small amount of money now into a savings account which serves as a retirement savings plan can pay off in the future. The interest you receive on money in a savings account will allow your preliminary investments to grow to something sustainable. A savings account will supply a place where you can accumulate capital earning a small interest rate until there is enough to invest in a trusted security which will yield you more like a municipal bond.
Another good approach that could certainly and gradually build a nest egg is to put money into long-term bonds. After maturation of the bond, you'll get back your initial investment along with all the interest which collected over the life of the bond. That's a tremendous amount of money for a 20- or 30-year bond-money that could 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 - Mchenry Cary, IL
However, 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 those for whom a 401K is not a retirement planning option, an IRA is the next best thing. Money put into this account is tax deferred and might be tax-deductible, depending on how much is invested each year.
For more details, please feel free 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 individuals in the Mchenry Cary, IL area.
