Retirement Planning – Medinah, IL
For the people in "Generation X" - described as people born between the mid-1960s and also the early 1980s - retirement planning seems like something your parents or other "old people" would do. But you know what? With a lot of "baby boomers" either already in the middle of retirement or looking at it on the horizon, "Generation X" stands out as 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 certain they've got the type of retirement they are working so hard to have. Below are great tips on preparing for retirement:
Retirement life in the future will be different than the retirement right now. It will be 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, people 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 4 years more than the average life span in 1980. Therefore investment planning for retirement has to account for a longer time of time now than a generation or two in the past.
Social Security and Retirement - Medinah, IL
On the downside, Social Security will probably be a far less reliable income source than it is now. And the likelihood is slim-and getting slimmer each year-that retirees 20 and 30 years from now will be able to rely on a work pension and enjoy lifetime benefits from their previous employer. Increasingly more, retired people will have to rely on their savings to pay for the costs of just living and medical health insurance.
With folks living for a longer time and needing more money to do so, retirement planning is a vital activity even for those people who are halfway to the regular retirement age of 65. It may be an intimidating task to plan for a couple of decades into the future, particularly with bills, housing costs and home loans to pay today, but procrastinating won't make it any less complicated.
Placing even just a small amount of money now 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 preliminary investments to grow to something sustainable. A savings account will provide a place where you can accumulate capital earning a small interest rate until there's enough to invest in a reliable security which will yield you more like a municipal bond.
Another good approach that can surely and steadily build a nest egg is to invest in long-term bonds. After maturation of the bond, you will get back your initial investment along with 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 can provide a good foundation for retirement. And a municipal or government bond is really as safe an investment as you can ever make.
401K and IRA - Medinah, IL
Nevertheless, the best approach when it comes to retirement planning would be to put cash 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 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 will be glad to help you! We offer 401K and IRA rollover and review services for folks in the Medinah, IL area.
