Retirement Planning Services – Prospect Heights
For those in "Generation X" - described as folks born between the mid-1960s and the early 1980s - retirement planning sounds like something your parents or other "old people" would do. But you know what? With a lot of "baby boomers" either already in the midst of retirement or viewing it in the near future, "Generation X" is definitely the next generation of folks to reach old age. Sure, it is still a ways off, but those in their 30s and 40s should start centering their investment planning on retirement and making sure 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 in the present day. It'll be better in some ways, and worse in some ways. However, the retirement planning for today's labor force must be far different than it was in yesteryear.
On the bright side, folks are living longer than ever. As of a short while 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. Therefore investment planning for retirement has to account for an extended period of time now than a generation or two back.
Social Security and Retirement - Prospect Heights
On the down side, Social Security is going to be a far less reliable income source compared to now. And 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 previous workplace. More and more, retired people will need to rely on their financial savings to pay for the costs of living and medical health insurance.
With individuals living longer and needing additional money to do so, retirement planning is an essential activity even for those who are halfway to the common retirement age of sixty-five. It may be an intimidating task to plan for a couple of decades into the future, particularly with bills, rents and mortgages to pay right now, but procrastinating won't make it any less complicated.
Putting even just a little bit of cash into a savings account which functions 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 offer a place where you can accumulate capital earning a little 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 could certainly and gradually build a nest egg is to put money into long-term bonds. Upon maturation of the bond, you will get back your initial investment along with all the interest which collected over the life of the bond. This is a significant amount of money for a 20- or 30-year bond-money that could provide a great foundation for retirement. And a municipal or government bond is as safe an investment as you can ever make.
401K and IRA - Prospect Heights
However, the best approach when it comes to retirement planning is to put money 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 may be tax-deductible, depending on how much is invested annually.
For more information, please do not hesitate to contact GC Financial Advisors Ltd. at any time and we will be glad to help you! We provide 401K and IRA rollover and review services for folks in the Prospect Heights area.
