Topic 7 · Interactive tool

Portfolio Glide Path

Young savers hold mostly stocks; people near retirement hold more bonds. Slide your age and see how the mix shifts, what it costs in return, and what it protects you from.

Stock / bond allocation across a working life

stocks % ≈ 110 − age · bonds % = 100 − stocks %

At age 25, the 110 − age rule puts 85% in stocks and 15% in bonds, for an expected long-run return of about 6.4% a year.

Stocks today

85%

expected 7%/year long run

Bonds today

15%

expected 3%/year long run

Expected return

6.40%

weighted average · before inflation

Years to retirement

at the chosen retirement age

% Stocks % Bonds Your current age

Your age now 25

1880

Retirement age 65

5080

Stock expected return 7%

3%12%

Allocation rule 120 − age (aggressive) 110 − age (standard) 100 − age (conservative)

Now vs at retirement

Now

At retirement

Lesson 6: Diversification and the stock-bond split → See the dollars in the Retirement Planner