How Smart is Your Retirement Account?

Why It Matters:

  • For those who can’t afford a personal financial advisor, a managed account may come close second.
  • A managed account considers your long-term financial goals and provides personalized recommendations.
  • Read on to understand the pros and cons of a managed account.

Dan Bruns tkc.profilePicture Written by: Dan Bruns | Morningstar Investment Management LLC
Dec. 18, 2018

4 Min readClock Icon

What is a Managed Account?

Next to hiring your own personal financial advisor, a managed account service is one of the few options available today that can offer you a comprehensive retirement strategy. A managed account provides you with personalized recommendations which may include how much to save, when to retire, when to take Social Security, and how to invest the money you are saving for retirement. A managed account may also provide you with a retirement goal that aligns with how you envision spending your retirement.

How Does It Work?

Managed accounts may be available to you through your employer-sponsored retirement plan. To create your personalized retirement strategy, a managed account service takes into account information about you – such as your age, salary, gender, and where you live. If offered through your employer, the service can get many of these key details from your retirement plan provider. But managed accounts can also gather some of these details from you, such as information about a 401(k) from a previous job or other investments you might have. The more information you choose to share, the more personalized your retirement strategy can become.

The Potential Benefits of a Managed Account

Are you saving enough for retirement? If not, what can you do today to improve your chances of reaching your goals? Some managed account services can help you answer these questions by showing you whether you’re on course to reach your retirement goals. It may also show how small changes to your savings and investing behavior can impact how much money you will have saved for retirement.

After signing up for the service, your retirement portfolio will be professionally managed. That means an investment management service will monitor your retirement account on an ongoing basis and make changes when necessary.

Is a Managed Account the Right Choice for Me?

No one has a crystal ball and no financial professional can guarantee results when it comes to investing for retirement. However, we do know that saving more and having a diversified portfolio can increase the probability of reaching one’s retirement goals. Are managed accounts the best solution for everyone? No, but it can make sense for many people. If you don’t feel confident picking your own investments—or don’t have the time to think about it—a managed account could be the right decision for you.

If your retirement plan is administered through Transamerica, your employer may have the option to include Managed Advice®, Transamerica’s managed account service, on your plan. You can see if Managed Advice® is available to you by logging into your Transamerica account.

Author – Dan Bruns, Morningstar Investment Management LLC

Things to Consider:

  • Ask your employer if they offer a managed account service.
  • Consider the pros and cons, like if the service comes with a fee.
  • Do what’s right for your current financial situation and long-term goals.

The Morningstar name and logo are registered marks of Morningstar, Inc. Morningstar Investment Management LLC is a registered investment adviser and subsidiary of Morningstar, Inc. Morningstar, Inc. and its affiliates are not affiliated with Transamerica. Opinions expressed are as of the current date; such opinions are subject to change without notice. Morningstar Investment Management shall not be responsible for any trading decisions, damages, or other losses resulting from, or related to, the information, data, analyses or opinions or their use.

Neither Transamerica nor its agents or representatives may provide tax, investment or legal advice. Anyone to whom this material is promoted, marketed, or recommended should consult with and rely on their own independent tax and legal advisors and financial professional regarding their particular situation and the concepts presented herein.

The Managed Advice® service is offered through Transamerica Retirement Advisors, LLC (TRA), an SEC registered investment advisor. Transamerica Retirement Solutions and TRA are affiliated companies. Morningstar Investment Management Associates, LLC®, a wholly-owned subsidiary of Morningstar, is an SEC-registered investment advisor that serves as an independent financial expert and provides the underlying investment advice and portfolio management methodology for the Managed Advice® service. Morningstar is not affiliated with any Transamerica companies. Please see the Managed Advice® agreement for more information on the terms and conditions that apply.



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