Retirement Planning – Northbrook, IL
For those in "Generation X" - defined as people born between the mid-1960s and the early 1980s - retirement planning sounds like something your mother and father or other "old people" would do. But you know what? With a lot of "baby boomers" either already in the midst of retirement or looking at it in the near future, "Generation X" stands out as the next generation of individuals to reach old age. Sure, it is a ways off, but those in their 30s and 40s should start centering their investment planning on retirement and making certain they've got the sort of retirement they are working hard to have. Below are great tips on preparing for retirement:
Retirement life in the foreseeable future will be different than the retirement right now. It'll be better in some ways, and worse in some ways. However, the retirement planning for today's workforce 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 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 back.
Social Security and Retiring - Northbrook, IL
On the down side, Social Security is going to be a far less reliable income source than it is now. And also 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 former workplace. More and more, retired persons will have to depend on their financial savings to pay for the costs of living and medical health insurance.
With individuals living for a longer time and needing additional money to do so, retirement planning is a vital activity even for those who are halfway to the standard retirement age of sixty-five. It can be a daunting task to plan for a few decades into the future, especially with bills, rents and mortgages to pay today, but procrastinating won't make it any less difficult.
Putting even just a little bit of money now into a savings account that 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 initial investments to grow to something sustainable. A savings account will offer 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 solid approach that may surely and steadily build a nest egg is to invest in long-term bonds. On maturation of the bond, you will get back your initial investment and also all the interest that collected over the lifetime of the bond. This is a significant amount of money for a 20- or 30-year bond-money that may provide a nice foundation for retirement. And a municipal or government bond is as safe an investment that you can ever make.
401K and IRA - Northbrook, IL
Nonetheless, the best approach when it comes to retirement planning is to put cash in a 401K plan at work or in an IRA opened with an investment house. For the 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 might be tax-deductible, depending on how much is invested annually.
For more details, 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 Northbrook, IL area.