BOSTON (TheStreet) -- Stocks have been maddeningly volatile for most of 2010. This creates a daunting task for investors who plan to rebalance their portfolios and retirement plans at the mid-year mark.

As painful as it may be to consider, standing pat may be the best strategy. For retirement plans, resisting the urge to make reactionary moves -- such as doubling down on stocks or fleeing from them -- can be a benefit over the long term.

A recent client advisory note from the brokerage Charles Schwab ( SCHW) illustrated such folly. During 2009, missing the best 10 days of the S&P 500 would have turned a 26.5% annual return into a 17.5% loss. Missing the best 20 days would have caused you to lose 38.4%.

While avoiding rash reactions is important, there are still some moves to consider. The ups and downs of the market may give clear insight into what your risk tolerance truly is, not just what you assume it to be. Exchange traded funds may provide the benefit of investing in positive sector trends, without the risk and volatility of pumping money into individual companies.

Schwab advises that once you have established an asset allocation strategy for your 401(k) based on your retirement savings goals and time until retirement, review your account to make sure allocations match their original targets. This is particularly important if the stock market significantly rises or falls. An investor with 60% of assets in mutual funds that invest in stocks and 40% in bond funds will likely see the proportion dedicated to stocks increase if the market were to increase by even 10% to 20%, making it a riskier account than originally intended to be.

Your age may also come into play this year. Many 401(k) plans allow those age 50 and older to make "catch-up" contributions. In 2010, 401(k) eligible investors can save an additional $5,500 above the standard limit of $16,500.

"You need to look at your finances holistically -- what you have, what you had a year ago and what you will likely have in the year coming. says Marcia Wagner of The Wagner Law Group, a Boston-based firm that specializes in retirement and employee benefits law. "But you can't view that solely based on one factor. People have to educate themselves to be financially literate and there is no better time to do it than now."

Wagner says that learning process needs to consider the "potential sea changes coming about as a result of new regulations and legislation."

It may be relatively painless to go along with automatic enrollments, automatic deferral changes and a preset slate of investment options such as target date funds. "Opt out" is quickly replacing "opt in" in employee plans.

"Things will be going autopilot more and more, which may or may not be good for a person," Wagner says. "It is ultimately their responsibility to make determinations even if that freedom will be co-opted in a certain way."

Wagner says relying solely on the expertise of others, can be dangerous.

"Many plan participants assume that their mutual fund company, the broker and the investment adviser to the plan is a fiduciary and has their best interest at heart," she says. "That is not necessarily the case."

-- Reported by Joe Mont in Boston.

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