Start Your Pension Plan Early
Some people think social security is a pension plan. Others believe that it is money the government put back for them for when they are older. This is not the case, although it was indeed the original intent of the program. Social security has long been a system of transferred payments. Most of the current recipients of SSI received far more from the program than they ever paid into it. This is a political battle that will be fought for many years. The younger individual knows that he probably should not rely on social security for his retirement. He may not know what to do about it, however.
One of the best ways to prepare for retirement is to start early. If someone starts a little later, that is okay. He should not wait until he is close to retirement age. He needs to find a way to build up his savings. If he belong to a company that offers a 401k, a pension plan, and other benefits, this is a good way. If he does not have these options, he needs to find a way on his own. An Individual Retirement account is one way, but it is not the only way.
Ideally, the person who wants to create his own pension plan needs to build up his savings and move them into accounts with an increasingly higher rate of return. He can play it safe, but he should not keep his money in a basic savings account forever. Until the Federal Reserve raises the interest rates offered for savings accounts, the normal savings account should only be used as a temporary hold for money. The owner of the money needs to decide how to invest it properly later. He can start finding out how to do this on his own.
All of this can be confusing, and when it comes to your money its best to talk to a pro. I recomend Robin S Weingast, good solid company, and really good people too.