Planning your retirement - DIY or hire a pro?

From Money.com

Whether to hire a financial adviser to oversee your investments really comes down to a realistic assessment of whether you could manage your money on your own or not.

If you don't feel comfortable doing it on your own - whether because you don't have the time, the confidence or you're just uneasy about going solo - then hiring an adviser makes sense.

It's certainly a better way to go than just picking investments on a whim or relying on the latest recommendations of some magazines or TV pundits.

Finding a financial adviser

1) The first thing you'd want to discuss with the adviser is when you expect to retire and what sort of risks you're comfortable taking.

2) After the discussion, the adviser should be able to recommend a portfolio of stocks and bonds that makes sense for your situation - and ideally should show you how the mix has performed historically in different types of markets.

3) I'd also want to be sure is the amount you'll paying in fees. Generally, a fee of 1 percent to 2 percent is a reasonable range to pay the adviser for his or her time and expertise.

4) What services other than investing your money can you expect for that fee?

5) Will you receive monthly or quarterly reports on your portfolio's progress? What will those reports tell you? (Ask for a sample.)

6) Will you have access to the adviser for periodic updates on your accounts? If so, how often will those updates occur, and will they be face-to-face or by phone? And will you talk to the adviser or another staffer?

Explore other options

1) The first thing you'd do is to see if your 401(k) offers some sort of investing and planning advice. The kind of advice can range from meetings with advisers to manage account programs that invest your 401(k) funds to online programs that can help you build a portfolio. In some cases, the advice can also consider money held in outside accounts like IRAs.

2) Another alternative you might consider is to see if your 401(k) offers target-retirement funds. A target-retirement fund will give you a coherent investment strategy for your retirement savings. Essentially, you choose a target fund with a date that roughly corresponds to the date you intend to retire - say, 2025 - and you get a completely diversified portfolio of stocks and bonds. The fund becomes more conservative as you approach retirement age by gradually shifting its asset mix more toward bonds.