Start counting on your own retirement plan

Baby boomers today have a mental picture of what retirement is, based on what they saw from their parents -- loyalty to one company, retiring at age 65, receiving the proverbial "gold watch" and a secure pension fund. However, unlike their parents, workers today cannot rely on such a secure retirement from their company.

According to the U.S. Department of Labor, a little less than half of all private employees are covered by a pension plan. The average private pension, for those covered, is just over $6,800 a year. Assuming you have access to it, it's not exactly a secure nest egg.

There are several reasons for less pension coverage. One is the baby boomer mentality. For example, "Joe Baby Boomer" is 33 years old and is starting his fourth job in 11 years. He's a skilled worker with expertise in a variety of fields, but has changed jobs out of necessity to enhance his job status, skill level and pay level. Due to all the changes, he hasn't been vested at any company since most pension plans require at least five years for full vesting.

Of course, like many baby boomers, "Joe" won't pay any attention to retirement benefits until he's 50 and by then it's too late. Today, companies are as disloyal as their employees and they continue to downsize in hopes of increased efficiency and profits. This trend means forced retirement for many middle managers -- the baby boomers -- who then find themselves unemployed at age 50 and having to wonder about their pension plan.

So what does the future have in store for workers currently between ages 30 and 40? Here are some projections based on current facts and trends:

One way to make sure you have a secure nest egg is to start managing your own retirement fund, and view pension plans and Social Security as a supplement to your plan. Take advantage of tax-deferred dollars, and build a strong base with incredibly safe investments like life insurance, then add to the base with riskier investments -- ones that could provide a higher rate of return. These are some of the best ways to guarantee that you'll have adequate retirement benefits when you need them because you are in control of making it happen.


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