The best asset allocation for your age

What’s the best asset allocation for your age?

Conventional wisdom suggests the percentage of equities in a portfolio should equal 100 minus your age. We put that wisdom to the test.

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Conventional wisdom suggests the percentage of equities in a portfolio should equal 100 minus your age—so 40% stocks if you’re 60 years old. But in our low-rate environment, coupled with the fact people are living longer, this outdated equation may not provide the returns needed for a comfortable retirement.

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A more aggressive guideline is to subtract your age from 120 for more stock growth that should make your money last longer—so 60% stocks if you’re 60 years old. Conservative investors can use 110.

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