retirement

8 rules of thumb on saving and retirement

Stocks vs. bonds
Next
4 of 10
Back
text

The rule: The percentage of your portfolio invested in bonds should equal your age.

Why it works: Famously repeated by Vanguard founder John Bogle, this rule of thumb helps investors keep in mind that their portfolios need to change as they age, becoming more focused on avoiding risk in their investing than on higher growth. That's because older people have less time to recover from stock market shocks than younger people.

Grain of salt: As you enter retirement, taking all your money out of stocks could slow the growth of your portfolio too much, preventing you from keeping pace with inflation and possibly depleting your retirement savings, says Pomeranz.


 

 

advertisement

Show Bankrate's community sharing policy
          Connect with us
advertisement
CD & INVESTING NEWSLETTER

Learn the latest trends that will help grow your portfolio, plus tips on investing strategies. Delivered weekly.

Blog

Jean Chatzky

Jean Chatzky: How to save wisely

These four smart savings moves can help set you on the right path to retirement.  ... Read more

advertisement
Partner Center
advertisement

Connect with us