Note: Robert's post is particularly timely this week, which is National Financial Planning Week. Time to get your finances in order!

Let's get this out of the way up front: This post is going to be a downer. So — right now — I want you to think of something happy to do after you've read it.

Got it? Good. Because this article is all about risk — in other words, all the things that can go wrong with your financial plan. We'll talk about ways to mitigate these risks, but thinking through this stuff isn't going to be all rainbows and cupcakes (though we've attempted to lighten things up with photos from the hilarious website AwkwardFamilyPhotos.com). Still, it's better to know what's possible and take preemptive action rather than stick your head in the sand, especially because getting sand out of all your head holes can be very difficult. So let's take a deep breath and confront the potential grim side of reality.

When it comes to investing, you have two big decisions to make: What to buy, and where to buy it. As for the former, you have all kinds of choices: cash, bonds, stocks, funds, real estate, and a piece of carpet from Elvis' jungle room (yes, I have a piece — at least, that's what the guy who sold it to me said it was). Regarding the latter, most people have just three general options: a traditional retirement account, a Roth retirement account, and a regular investment account. This article is about the second category — how to make the most of your investment accounts.

Stop the Sprawl

If you're like many investors, you have accounts spread throughout the financial services industry: an IRA or two here, a brokerage account there, perhaps a 401(k) still with a former employer. If you're married, your spouse probably has a lineup to match. By consolidating as many of those accounts as you can with a single provider, you'll unclog your mailbox and make tax time easier -- and you can even make your portfolio fatter, thanks to these advantages:

• Find a better balance. Determining your asset allocation can be tough when you have to look at lots of statements. Rebalancing across several accounts gets tricky; for example, you can't sell the bonds in your 401(k) to buy stocks in your IRA.
• Move money out of mediocre (or worse) accounts. This is especially true of money left in retirement plans from former employers, which often have limited investment choices at high costs.
• Get extra services and discounts. Financial companies lure big accounts with lower fees, plus planning services such as a portfolio analysis or access to a Certified Financial Planner.

Find the Best Provider

Choosing a company that deserves the honor of holding your nest egg depends on your style of investing. Here are guidelines based on your investments of choice:

A beginning investor can easily be overwhelmed by the variety of investments and retirement strategies available. When I started a 401(k) program for a small company I worked for, only one person, me, made any elections for several months. Here's a bit of helpful knowledge to make those choices a little easier for you than they were for me.

First, an indelicate question:

Before we can start making suggestions we need to ask: how much money do you have?

Brokers, like, in Boiler Room?

Before we answer the question, "should I use a broker to buy and sell stocks?" we should distinguish what, exactly, we expect a broker to do:

• All brokers are legally permitted to buy and sell stocks, bonds and other securities, like derivatives and commodities, on a stock exchange on behalf of a client.

Many brokers perform additional services (and if you've ever watched a movie featuring stock brokers, this is likely what they were doing):

• Many brokers advise clients on which stocks and bonds to buy and sell, how much, and when
• Some brokers provide additional financial services or recommendations, like asset allocation, estate planning, the tax impacts of certain investments, and even small business or real estate investment ideas. Such an individual might have an additional certification, like the Certified Financial Planner designation.

From the comfort of your own home

If all you want to do is to find someone to carry out an order as you execute it -- to make a specific stock purchase for you when you decide the time is right -- then you do need a broker (someone who, by virtue of having passed the Series 7 examination, is legally permitted to buy and sell stocks and bonds). But you don't actually need to have a personal broker; a person to whom you talk. Online brokerage firms which let you type in stock symbols and quantities of shares and click, "buy," will do just fine. You'll typically pay far less for the service, and you won't have someone's advice mucking up your investing chi.

The buy-and-hold investing strategy explained

If you are trying to decide which investing strategy to use after having learned a bunch of new financial lingo, you might be thrilled to come across the buy-and-hold strategy. What you see is what you get! The buy-and-hold investing strategy is simple:

You purchase stocks and hold them for a long time, decades even, until you retire or even longer.

Phew. That was easy! Now, is it a good idea?

So you want to buy stocks? Maybe you're interesting in investing in direct stock purchase plans? Great! But you only have a small amount of money each month to invest? You're worried about any potential returns being wiped out in the beginning by brokerage fees? You're wise to worry.

Invest $100 bucks per month with a discount broker and you're lucky if you pay commissions equal to seven percent of your investment. Seven percent! That's a decent annual return, and you're giving that up at the start. Yikes!

We at The Motley Fool have always been champions of the individual investor, encouraging each person to take control of her or his financial destiny. In theory, the transition of America's retirement apparatus from defined-benefit plans — i.e., pensions that pay a monthly amount — to defined-contribution plans — such as 401(k)s and 403(b)s — is consistent with this Foolish philosophy. The individual makes all the contribution, investment, distribution, and inheritance decisions, whereas with a defined-benefit pension, the worker has very little control.

However, for the majority of Americans, the transition away from defined-benefit has not been to their benefit. It requires each person to become an investing expert and financial planner in their spare time, and too many Americans don't seem to have the time, interest, inclination, or skills.

According to the Employee Benefit Research Institute, the average 401(k) account is a tad over $60,000; those within a decade of retirement have a bit more, with an average balance of $78,000, but more than a third have less than $25,000. Almost half of workers (43%) between the ages of 45 and 54 reported they weren't saving anything for retirement.

Most of us know we should save for retirement, but sometimes it's tough to get started. If your employer sponsors a retirement plan — especially if it offers a generous match to your contributions — that's usually the best place to begin. But even if you don't have a retirement plan through your job, you can still save for the future. One of the best ways to do so is through a Roth IRA.

What Is a Roth IRA?

An IRA is an individual retirement arrangement, a retirement plan that gives you tax advantages when saving for retirement. There are two types of IRAs:

• With a traditional IRA, the money you contribute is typically tax-deductible, but the money you pull out at retirement will be taxed at the then-current rate.

• With a Roth IRA, you contribute after-tax dollars, but when you retire, you don't have to pay taxes on the investment returns.

In other words, money in a traditional IRA is taxed when you pull it out, but the money in a Roth IRA is taxed before you put it in.

I've been saving for retirement since my mid-20s, and I write a retirement-planning newsletter every month. Yet here's the thing: I don't plan to ever fully retire. And while most people list “retirement” as their number one investing goal, I don't think most other people should retire, either — at least not at age 64 for men and 62 for women, which are the average retirement ages these days, according to the Center for Retirement Research at Boston College.

I question the value and wisdom of retirement for financial reasons, for health reasons, and for “why should we encourage people to sit on their butts all day” reasons. However, in this post, I'll question retirement from a risk perspective: Can anyone really be sure that their savings and benefits will last for a few decades? Let's take a closer look.

1. Social Security has “issues.”
I've written before that all the talk of people getting nothing from Social Security is overblown; everyone will get something. But there are enough problems to suggest that younger and wealthier people should expect to get much less than their currently projected benefit. Not that the current benefits are enough to buy beachfront property; the average annual Social Security benefit is just $14,172. If that weren't scary enough, according to the Social Security Administration, more than half of elderly beneficiaries receive 50% or more of their incomes from Social Security; for 22% of married couples and 43% of unmarried beneficiaries, Social Security provides 90% or more of their incomes. The fact is, most Americans do not do a good job of planning for retirement.

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A money-market fund is a very low-risk type of mutual fund, meant to be as close to cash as possible while still earning a modest return. It is different from a money-market account, which is a type of deposit account in which the entire principal is invested in money-market funds by the bank. One key difference is that money-market accounts are FDIC-insured, while money-market funds, like all mutual funds, are not.

Short-term savings

Money-market funds are meant to be very "liquid," meaning they are easier to cash out at any time without expecting a loss, and thus are used for many short-term savings needs:

• an emergency fund
• a savings account for a down payment for a house
• a college fund for teenagers
• a savings fund for travel or other near-term needs
• a "parking place" for money while you decide how to invest it

The investments that make up a money-market fund are "cash and cash equivalents." These are limited to highly rated debt issues (think AAA and AA) that mature in 13 months or less. Typically, money-market funds are mostly invested in U.S. treasury bonds, CDs from highly rated U.S. and foreign banks, and commercial paper (similar to bonds, with much shorter maturities, and usually issued by banks or very highly rated companies).