Retirement Planning – Riverside
For those in "Generation X" - defined as people born between the mid-1960s and the early 1980s - retirement planning sounds like something your parents or other "old people" would do. But guess what? With many "baby boomers" either already in the middle of retirement or looking at it on the horizon, "Generation X" will be the next generation of folks to reach retirement. Sure, it's still a ways off, but people in their 30s and 40s must start centering their investment planning on retirement and making certain they have the type of retirement they are working so hard to enjoy. Here are some tips on preparing for retirement:
Retirement life in the future will be different than the retirement right now. It will likely be better in some ways, and worse in some ways. But, the retirement planning for today's workforce must be far different than it was in the past.
On the bright side, people 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 over 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 - Riverside
On the down side, Social Security is going to be a far less dependable source of income 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 employer. Increasingly more, retired people will need to rely on their financial savings to pay for the costs of just living and medical health insurance.
With people 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 regular retirement age of sixty-five. It may be an intimidating task to plan for a few decades into the future, particularly with bills, housing costs and home loans to pay right now, but procrastinating won't make it any easier.
Placing even just a little bit of money now into a savings account which functions as a retirement savings plan can pay off later. The interest you get on money in a savings account will allow your initial investments to grow to something sustainable. A savings account will supply a place where you can build up capital earning a little interest rate until there's enough to invest in a reliable security which will yield you more like a municipal bond.
Another solid strategy which could certainly and steadily build a nest egg is to put money into long-term bonds. After maturation of the bond, you will get back your initial investment and also all the interest which collected over the lifetime of the bond. This is a tremendous amount of money for a 20- or 30-year bond-money which 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 With Retirement - Riverside
However, 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 isn't a retirement planning choice, 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 every year.
For more information, please do not hesitate to contact GC Financial Advisors Ltd. at any time and we will be happy to help you! We offer 401K and IRA rollover and review services for folks in the Riverside area.
