What test do i use to show this series converges or diverges?
$$\sum_{r=1}^{\infty}\frac{1}{(1+\frac{1}{r})^{r}}$$
I know that $(1+\frac{1}{r})^{r} \rightarrow e$ so does this function converge to $\frac{1}{e}$? and is it sufficient just to say that?
Yes, looking at the limit you gave is sufficient: the series diverges. It is a basic (yet fundamental) result that if the series $\sum_n a_n$ converges, then it must be the case that $a_n \xrightarrow[n\to\infty]{}0$.