Retirement Example
Retirement Investment Plan — Portfolio Allocation Examples
How to allocate a retirement portfolio across stocks, bonds, and cash at different ages.
Scenario
Asset allocation changes by age — from growth to preservation.
Inputs
Rule of thumb110 minus your age = % in stocks
Results
Age 30: 80% stocks / 20% bonds
Age 45: 65% stocks / 35% bonds
Age 60: 50% stocks / 50% bonds
Age 70: 40% stocks / 60% bonds
Explanation
As retirement approaches, shifting from growth (stocks) to preservation (bonds/cash) reduces volatility. The '110 minus age' rule is a simple starting point — aggressive investors use '120 minus age'. At age 65, a 50/50 portfolio still grows enough to support 30-year retirements.
Key Takeaways
- Target-date funds automatically rebalance allocation as you age.
- Don't be too conservative too early — inflation erodes bond returns over decades.