Analyzing your 401(k) for free with Blooom can save you money on fees and put more in your retirement account

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Blooom has two goals: to help you cut costs and help you save more.

Saving for retirement isn't as simple as just putting money into an account. You have to make numerous decisions, and if you don't know the ins and outs of investing, the process can become confusing.

For example, should you invest in a target date fund or an index fund? And what's an ETF? What does it mean to diversify your portfolio?
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When you aren't an expert in investing, it's hard to know if you're making the right decisions with your retirement account. That's where Blooom can be useful.

Blooom is an investment company that analyzes your retirement account(s) and offers advice on how to prepare for retirement more effectively.

Blooom spells out two goals: to help you cut costs and help you save more. I used Blooom to analyze a family member's 401(k) to see the kinds of suggestions it would make for her to save for retirement more strategically.
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The basics of Blooom

When you create an account with Blooom, the company analyzes your retirement account(s) for free and explains whether your not you're maximizing your retirement savings.

After Blooom conducts its analysis, you can decide whether you want to become a member for $120 per year.What do you get for $120? Well, Blooom researches and selects the best funds available for your plan, eliminates hidden investment fees where it can, diversifies your portfolio, and handles your account's transactions.
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Blooom does not move your money into a new account, hide its fees, or try to time the market. (If anyone tells you they can time the market, sprint in the opposite direction!)

Use Blooom to analyze your 401(k) and stop spending money on unnecessary fees »

Getting started with Blooom

There are four steps to using Blooom: provide your personal information; link your retirement account(s); receive Blooom's analysis; and take what Blooom refers to as the "next steps," which really means becoming a Blooom member.
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First, provide information about your retirement accounts and plans in the "about you" section. Blooom asks questions to gain an understanding of how much risk you want to take with your investments.

Some questions are directly related to the stock market, and others are about how likely you are to take risks in other aspects of your life, like at your job or on vacation.

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Blooom

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After assessing your risk preferences, Blooom recommends the best balance of stocks and bonds based on your answers.

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Blooom

Now it's time to link your retirement account. You'll provide Blooom with the username and password for your online account so it can access your information. Blooom then analyzes your investments, and explains how it can help.
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After reading Blooom's analysis, you can decide whether you'd like to become a member.

Blooom's analysis is thorough and easy for beginners to understand

Blooom analyzes three main aspects of your retirement account: fees, risk, and diversification. First, it shows how much you are paying in fees versus how much you would pay with Blooom. (This number is based on its client median investment fee expense.)
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Then, it shows how much risk you are currently taking versus how much it thinks you should be taking based on your previous answers about risk.

Finally, it shows how diverse your portfolio is compared to how diverse Blooom thinks it should be.

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Blooom

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At each stage, you can click "Tell me more..." to read an in-depth explanation of why you're paying certain fees or how Blooom could help you save more.

For example, the family member whose 401(k) I analyzed only invests in a target date fund because the investment adviser at her place of employment recommended this option when she created the account.

When I clicked on "Tell me more...," Blooom explained that target date funds typically charge higher fees than many other types of funds.
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When you visit the main "analysis" page, Blooom shows how and why it would change the way you invest. For example, here's what it says about my relative's target date fund:

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Blooom

No, Blooom doesn't offer a free trial. But it does provide you with a ton of personalized information before you have to decide whether or not to pay for a membership.
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Blooom only links with certain companies

Blooom is great - if it works with your financial services company. And while it supports many of the big-name companies, it doesn't link with all of them.

My original plan was to use Blooom to assess my family member's 401(k), my husband's 401(k), and my own IRA. However, I ended up only being able to use Blooom with my relative's 401(k), because she uses John Hancock, a popular retirement-plan service.I hit a roadblock with my husband's 401(k) because he works for the State of Tennessee, and Blooom doesn't support the State of Tennessee's retirement plan yet. (Although they say they hope to soon.) Blooom does support some state governments' plans, though.
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I reached a dead end with my IRA, too. I save with Ameriprise Financial, but when it comes to IRAs, Blooom only works with Fidelity, Vanguard, and Charles Schwab.

A customer support agent explained to me that Blooom has chosen these companies because they believe they provide "the best low-cost index funds and ETFs."

If you have trouble logging into your account or are confused about whether Blooom links with your company, you can always hop onto customer support chat. I had a positive experience with customer support. (My agent even livened up the conversation with a "Parks and Recreation" GIF.) She explained why I was having trouble logging in, redirected me, and made the process much smoother.
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Whether you decide to become a Blooom member or not, you'll have a pleasant, risk-free experience with its free product. Plus, you'll become more knowledgeable about yourself and your retirement account.

Blooom's analysis tool is free and easy to use. Find out how to maximize your retirement savings today »

Disclosure: This post is brought to you by the Personal Finance Insider team. We occasionally highlight financial products and services that can help you make smarter decisions with your money. We do not give investment advice or encourage you to adopt a certain investment strategy. What you decide to do with your money is up to you. If you take action based on one of our recommendations, we get a small share of the revenue from our commerce partners. This does not influence whether we feature a financial product or service. We operate independently from our advertising sales team.

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