Retirement is a big career change for most people. Just like changing professions, it takes planning and preparation. Like most things in life, you have to accept responsibility for your own retirement.
There is a lot of good information available from most state websites and insurance companies always advice to give. Books on the subject are available from your local library or any book store. And, you can order a lot of information from Amazon or Barnes&Noble that can help with your retirement plan.
Most people don’t want the hassle of planning something that far in the future. Do you see planning for your retirement as your responsibility or is it something you can let someone else do for you? Is that a shocking question? During the preparation phase of retirement planning, we often let our employer hire a fund manager to take care of our 401k.
So, letting someone else take care of the plan is not unusual, but you still have to watch it and take the responsibility to make sure it is managed properly. When someone else is watching over it, it becomes really easy to forget about the retirement plan.
Of course the purpose of the question is not to suggest that you are not a responsible person. If you are participating in your employer’s retirement program or 401K, then you are showing plenty of personal responsibility for your retirement planning.
When you stop to think about it, most of us don’t know what happens to 401K funds after we give them to our employer? We get statements that show that what we invest is gaining (or not gaining) in value and we hope that the principle is safe. For most of us, that is enough.
It is easy to trust your employer to manage the funds well and hopefully it will all be there when the time comes to retire and that 401K is needed. The truth is that your employer probably has nothing to do with how well your retirement portfolio performs once the funds are taken out of your paycheck.
In most cases, your employer hires a professional retirement planner who invests those funds to give you at least a modest return on investment. That service is also taking a fee from your funds. The fee is usually taken without giving you the chance to evaluate the service to determine if they deserve the money they are making.
Part of your responsibility is to see that people that work for you, such as a retirement planner or fund manager, know what they are doing and are held accountable for the outcome of their management of your retirement funds. You probably can’t fire the financial planner or fund manager, but you can vote at shareholder’s meetings. But you can communicate your financial plans and you can find out who is responsible for what happens to your money. If you talk to them or meet with them, you may have more success in getting them to be accountable to you.
You may find yourself engaging a financial planner for funds that fall outside of an employer 401K plan. For example if you leave a job and roll a 401K into a private IRA account, you may engage a financial planner or firm to invest that money so it continues to grow until you need it at the time of retirement.
It is a good idea to develop some standards that you can use to judge any retirement planner you engage. Make a list of questions to ask on your initial meeting. A referral from people you know and trust is a good way to pick a financial planner. If your family members or close associates are already using a good financial planner, get that person’s name and schedule an interview.
Check with your bank, insurance company or credit union. Most provide financial planning services. They already work for you and they will be eager to provide financial planning for your retirement.
Put some time and effort into finding out if the retirement planner you are considering is capable and has a good reputation. They should willing to give you references and have documentation of their success to show they can be trusted to take good care of your retirement funds.
If you do some due diligence up front, you will find someone you can trust this important resource to and have confidence in knowing they are good stewards of the money that is going to give you a happy and peaceful retirement life.