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Question:


Should I pay someone to manage my retirement account?
-TedRogers


Answer:


It’s not clear from your question just what you’re looking for. There’s managing, and then there’s managing. Any assets that you have in vehicles like mutual funds or exchange-traded funds are already being managed on one level. Figuring out how to diversify a portfolio among various asset classes, such as stocks, bonds, precious metals, real estate and cash surrogates like money-market accounts, and then picking which managers to invest with is a whole other kind of management. There is still another level of management beyond that that involves placing a retirement portfolio in the context of a broader, holistic financial plan encompassing advice on taxes, insurance, inheritance issues, charitable giving and so forth, and not just for you but your family, too. Whether you need help with your financial affairs depends on how complicated and extensive they are and which of these sorts of management you’re interested in.

If you’re not sure what the answer is in each case, why not sit down with some financial advisers – you can get referrals from friends or from professionals that you already do business with, such as lawyers or accountants – and see what they have to say. Ask them a lot of questions about their backgrounds, the services they provide and the relationships they have with other professionals, in and out of their own offices, who provide services that they don’t provide themselves. Also ask about their fees and how they’re structured – make sure they charge by the hour, not by taking commissions on products, which can create conflicts of interest – and get references from other clients. Judge their answers not just by what they say but by how they say it. If they talk down to you or act annoyed or, conversely, if they come across as telling you what they think you want to hear, then you might want to say no thanks. If they give thoughtful and apparently honest responses and if they ask you a lot of questions about your circumstances, needs and goals, then you may want to give them further consideration.

-Conrad de Aenlle



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