Asset Allocation by Age: Building a Resilient Portfolio for Every Life Stage

Let’s talk about asset allocation and how it changes as we move through life’s different chapters. Simply put, asset allocation is how you divide your investments among stocks, bonds, and cash. Getting this mix right can help you manage risk and support your financial goals. This information is educational and not intended as investment advice. Please consult a qualified financial professional if you have specific questions about your circumstances.

If you’re just starting out in your career, you may have a longer time horizon. This often allows for a higher allocation to stocks, which can be more volatile but have historically provided greater long-term returns. As you get older and begin to consider expenses like education or retirement, you may choose to shift toward a mix of stocks and bonds to balance growth and preservation. These are general concepts and may not apply to everyone.

As retirement approaches, priorities may shift again. A portfolio with a greater focus on bonds and cash can offer more stability and income, helping to reduce exposure to market downturns. Remember, asset allocation should be reviewed regularly to ensure it aligns with changing needs and risk tolerance. This is not a recommendation; please consider your individual situation or consult a professional.

If you’re not sure where to start, there are calculators and tools available on Investor.gov. These resources can help you understand different asset allocations and what may be appropriate based on your age and objectives. Always use these tools as a starting point and seek professional advice for your specific needs.

Bottom line: asset allocation is a valuable concept for managing risk and working toward your financial goals at every stage of life. Make use of available resources, review your portfolio regularly, and remember—this is general information, not personal investment advice.

Sources:

• https://www.sec.gov/about/reports-publications/investorpubsassetallocationhtm
• https://www.investor.gov/introduction-investing/getting-started/asset-allocation
• https://www.investor.gov/financial-tools-calculators/calculators/compound-interest-calculator
• https://www.investor.gov

Disclosure

The information in this article regarding asset allocation for different ages is provided for educational purposes only and does not constitute investment advice, an offer, or a solicitation to buy or sell any securities. All investing involves risk, including the possible loss of principal. Past performance does not guarantee future results, and asset allocation strategies do not ensure a profit or prevent loss in declining markets.

Asset allocation recommendations in this article are general in nature and may not suit all investors. Your financial goals, risk tolerance, and time horizon are unique. Before making any investment decisions or changes to your portfolio, consult a qualified financial advisor or investment professional.

Information and data presented are obtained from sources believed to be reliable, but their accuracy and completeness are not guaranteed.

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