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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From the November 2013 issue of the magazine.

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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 But in our low-rate environment, coupled with the fact people are living longer, this outdated equation may not provide the returns needed for a comfortable retirement.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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2 comments on “What’s the best asset allocation for your age?

  1. Pingback: Getting Serious About Savings in 2014 | Blonde on a Budget

  2. Is this calculation based on retiring at 60 or 65?
    Foe ex: I am 57 and want to retire at 60, would I still want 63% of my RRSP in equities?

    Reply

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