cal83dls79 said:
oski003 said:
cal83dls79 said:
oski003 said:
bear2034 said:
Eastern Oregon Bear said:
bear2034 said:
I'm not upset about them. I'm upset about the 15% of my retirement fund that's evaporated.
If you're nearing retirement and your 401k consists mainly of managed target funds, a large percentage of your portfolio should be allocated to bonds instead of stocks?
This is correct. I am not sure why the poster above me is mocking conventional wisdom.
because it's not even close to conventional wisdom. Between 03, lover of movies and 2034 please don't offer any portfolio allocation and strategy advice. It's like the Lutnick trio
What should someone near retirement age do then? Shouldn't they get more conservative in case the market drops?
of course. There is an array of low risk options. But if you are "nearing" retirement bonds would NOT be my investment of choice when you consider you got 30 more years to go. That's all the advice I'll give. Everyone has their own risk spectrum. Pretty clear how old I am given my BI name. Good luck out there. The market was a complete disaster this last week and self inflicted. For someone newly retired it's not a joke.
The "100 minus your age" rule suggests subtracting your age from 100 to determine the percentage of your portfolio you should invest in stocks, with the remaining percentage allocated to bonds or other fixed income investments.
Here's a breakdown:
The Rule:
The core concept is to subtract your age from 100 to arrive at the suggested percentage of your portfolio that should be invested in stocks.
Example:
If you are 30 years old, the rule suggests investing 70% (100 - 30) in stocks and 30% in bonds or other fixed income investments.
Rationale:
This rule is based on the idea that younger investors have a longer time horizon and can tolerate more risk, while older investors, closer to retirement, prioritize capital preservation and a more stable income stream.
Limitations:
The rule is a general guideline and may not be suitable for everyone, as individual circumstances and risk tolerance can vary. SmartAsset says that a one-size-fits-all approach can lead to unintended consequences, especially in changing economic environments or under unique personal circumstances.