A couple with $8,400 in combined pension and Social Security income, $1.6 million in a 401(k), $350,000 in Roths, and a $300,000 taxable brokerage account seeks advice on whether to use a target date fund or an annuity for RMDs. They own their home outright and are considering a robo-advisor. -JR

An annuity, a form of insurance, can protect against the risk of outliving your money but may not be necessary for those with other income sources like pensions and Social Security. Relying on an investment portfolio may offer more flexibility for managing income needs.

A target date fund, which adjusts holdings as retirement approaches, can be a low-cost alternative to an annuity or robo-advisor for managing a diverse portfolio. Considerations should be based on personal goals, risk tolerance, and fee preferences.

Using a target date fund in tax-advantaged accounts like an IRA can be a cost-effective way to manage investments. Robo-advisors and target date funds both offer diversified portfolios, but a target date fund may be a more affordable option over time.

For a couple with significant assets in various accounts, a financial advisor with expertise in investment and tax management can provide valuable guidance. Asset location and tax-efficient withdrawal strategies can maximize investment efficiency and reduce costs.

Considerations like asset location and tax-efficient withdrawal strategies can significantly impact the efficiency of managing assets. A financial advisor can add value through these strategies, making the cost of their services worthwhile for those with complex financial situations.

SmartAsset offers a free tool to match individuals with financial advisors who can provide tailored advice based on individual goals and financial needs. Advisors can help with asset location, tax-efficient strategies, and overall financial planning.

Maintaining an emergency fund in a liquid account can help cover unexpected expenses without risking significant fluctuations in value. Consider high-interest accounts for earning compound interest while maintaining liquidity to cover emergencies.

Read more at Yahoo Finance: Should We Move Assets into a Target Date Fund or an Annuity?