How Often Should a Retirement Plan be Reviewed?


retirement plan review

Everybody wants a reliable retirement, but some don’t know exactly how to get that done. Once you’ve gotten your annual contributions planned out, do you just leave it be? Is it enough to just keep putting money in and leaving it at that? Well, you can, but that won’t make the most out of your retirement. For the best results, there needs to be some level of retirement plan review.

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What is a Retirement Plan Review?

Reviewing you retirement plan involves an analysis of its growth. You examine what your funds are invested in, how those investments have grown, and where you can make improvements. You can take a look at what fees are being taken from the account, and make sure that it has operated according to your plan documents. All of these will help you optimize the growth and reliability of your investments, while also ensuring that they are in good hands.

Why Should I Review?

It is vital to ensure that you know where and how your money is working for you. Not only is a retirement plan review important to boost growth, but it is also essential in making sure you aren’t getting abused or charged high fees by the firm that handles your money.

Retirement plans can be complicated, and certain procedures within your can change year-to-year as laws do. It is your job to confirm that these changes don’t go overboard or begin to conflict with your original plan documents.

If parts of your plan are being invested in funds that are producing sub-par growth, a review can fix that. You can’t reallocate to higher-performing funds if you don’t realize you’re underperforming in the first place.

How Often Should I Review?

You need to be taking time annually to review your plan. You should compare each fund’s growth to the other funds in which you are vested. In addition, you also need to compare the current year’s growth with previous years.

If there is a dip or a gain, you should research why. Did you enter a new fund that you may want to invest in more heavily? Did the market itself take a turn, and no new action is required? You can only know if you check, and once a year is a great timeframe.

This is because you give your investments enough time to prove their worth, without letting one hold down your account for too long. It strikes a balance between the “set it and forget it” convenience of retirement accounts, and the necessary caution of investing in general. you don’t want to be constantly micromanaging your investments, taking multiple transaction fees per year because you see something you don’t like. On the other hand, you don’t want to leave it for 5 years and realize you could’ve increased your annual gains by 50%. The annual model makes retirement plan review manageable and effective.

So, how often do you review your retirement plan? Let us know if you have a plan, and how often you review it, in the comment section below!

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