I’m 65 and want to retire in 6 months. I have a $125K annuity, plus $100K of money that I’m not sure what to do with. Should I get professional help?

Question: I had $225,000 in my 401(k) and then I rolled over $125,000 to an annuity at 7%, as I wanted income. I just turned 65 and want to retire in six months, but I don’t know what to do with the other $100,000. What should I do? Should I hire a financial adviser to help?  (Looking for a financial adviser too? You can use this tool to get matched with an adviser who might meet your needs.)

Answer: Congrats on your impending retirement — and know that it’s totally normal to feel like now may be the time to hire a financial adviser. As for whether you need one or not, that really depends on your preferences and how comfortable you feel about dealing with your own finances, and we’ll get into that more later.

Have an issue with your financial adviser or looking to hire a new one? Email [email protected].

But first, to figure out how to deploy the $100,000, you first need to understand the big picture of your life and finances, and what you need that money to do for you. Look at your other income sources, spending needs, how much you’ll withdraw from various accounts when you retire and the tax implications of all of that, says Justin Pritchard, a certified financial planner at Approach Financial. “Determine how much money you need to live on per year and then you can break that down into how much you’ll need every month, taking into account any income from Social Security or any other sources like a pension,” says certified financial planner Patrick Logue of Prudent Financial Planning. This guide can help you figure out some other financial things you need to figure out to see if you’re financially ready to retire.

Once you know that, understand that your $100,000 can be utilized in many ways — you can withdraw it, transfer it to another retirement account or keep the money in your 401(k), among other options. And what’s right for you depends on how you want to use that money. “To determine the right decision for you, an adviser will gather your financial information and ask questions about yourself. They’ll analyze your current financial situation and determine the best place for your money,” says certified financial planner Danielle Miura of Spark Financials. Of course, you can do this yourself too — though that will require understanding how much money you’re going to need to retire, and how much risk you’re willing to take with that $100,000, and more. Note that since you have the option of keeping the money in your 401(k) and letting it grow, unless you need the cash for essential living expenses, you likely wouldn’t want to withdraw it, pros say.

Another part of the puzzle? It would “help to know more about the annuity, such as whether or not it’s a single-premium deferred annuity (SPDA),” says Logue. An SPDA is an annuity funded with a single lump sum that offers guaranteed income with a tax-deferred growth on the investment. This can be beneficial because you’re offered a guaranteed rate of return, which can make retirement planning easier and you don’t have to pay taxes on the annuity until you begin taking distributions.

If this sounds like a lot, an adviser may be helpful — and you can use this tool to get matched with an adviser who might meet your needs.

“If you opt to work with a financial adviser, it’s a good idea to look for a fiduciary who has a legal obligation to work in your best interest and can’t recommend products or services just because they’ll receive a financial kickback for doing so,” says Alana Benson, investing spokesperson at NerdWallet. Here are the different types of advisers you might encounter, and here are the questions to ask them.

Financial planning is so much more than just handling investments. “It’s about reducing potential risks to your retirement, tax-efficiency, asset protection, estate preservation and more. If you don’t have a long-term care plan, the risk to your nest egg is greatly increased compared to if you had one. Not having a proper, proactive care plan can devastate a lifetime of savings,” concludes certified financial planner Grace Yung of Midtown Financial Group. 

Have an issue with your financial adviser or looking to hire a new one? Email [email protected].