Saving for retirement is something you should aim to do throughout your career. By prioritizing your nest egg, you can potentially put yourself in a great financial position to cover your senior living costs without stress.
Many people simply open an IRA or sign up for a 401(k) plan through their employers, fund those accounts year after year, and basically make their own decisions about retirement savings. But should you be taking that approach? Or should you be asking for professional help?
A recent survey by Edelman Financial Engines found that 50% of respondents believe they require help from a financial professional to accomplish their goals. And for 42% of respondents, a top financial goal is none other than saving for retirement. If you've yet to engage the services of a financial professional, you may want to reconsider.
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The upside of working with a professional
If you know a lot about investing and the various retirement plans that are available to savers today, you may be just fine tackling the process of building a nest egg on your own. But if you're not quite sure what you're doing, whether you've chosen the best home for your money or how to invest the funds you're socking away for the future, then finding a professional advisor may be a smart idea.
The good thing about working with a professional is that they can assess your finances and goals objectively from a non-emotional standpoint. You, for example, might be really scared to invest your long-term savings in stocks, and that may be guiding your decisions. As an outsider, a professional advisor can take a look at your strategy and potentially offer tweaks that make it more likely that you'll meet your goals.
It especially pays to engage the services of a financial advisor if you feel clueless about investing for retirement and have no idea how to go about the process. If you have a 401(k) through your employer, for example, a financial advisor can review the various funds that are available to you in that plan and help you choose the right ones, keeping in mind factors that include risk, returns, and fees.
If you have an IRA that you're managing on your own, a financial advisor can help you assemble a portfolio of stocks that may not only be conducive to growth, but also offer the diversification you need. Or they might suggest broad-market index funds for hassle-free diversification.
Furthermore, a professional might be able to introduce you to savings vehicles you weren't aware of. For example, let's say a health savings account (HSA) has never hit your radar. It may be that your health insurance plan is compatible with one. Taking advantage could help you shield near-term income from taxes while allowing you to build up a healthcare savings fund for your future.
You don't have to go it alone
Many people are perfectly comfortable taking charge of their retirement savings without outside help. But if you're feeling less than confident, ask friends, neighbors, and colleagues if anyone has a financial professional they recommend
Then sit down with those candidates, talk to them, and aim to find someone you feel you'd like to work with. It might spell the difference between meeting your retirement goals or falling short.
