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Your age is the single biggest factor in how you should split your portfolio between stocks and bonds. Young investors can handle more risk because they have decades to recover from crashes. Older investors need more stability because they are spending the money soon.
Here is a decade-by-decade breakdown with specific percentages, fund examples, and the reasoning behind each split.
Enter your holdings and see your actual allocation vs. the target for your age.
Open Portfolio Visualizer| Age | Stocks | Bonds | Risk level |
|---|---|---|---|
| 20s | 90% | 10% | Aggressive |
| 30s | 80% | 20% | Growth |
| 40s | 70% | 30% | Moderate growth |
| 50s | 60% | 40% | Moderate |
| 60s+ | 50% | 50% | Conservative |
These are starting points, not rules carved in stone. The classic formula is "110 minus your age" in stocks. Some people use 120 minus age for a more aggressive stance.
At 25, you have 40 years until retirement. Market crashes do not matter at this stage because you have decades to recover. A 90/10 split puts nearly everything in growth.
Some 20-somethings go 100% stocks. That is fine if you can stomach a 40% drop without panic-selling. Most people overestimate their tolerance until they watch $30,000 disappear in a month.
Still 25-30 years from retirement. Time is on your side, but you might have a mortgage and kids now. An 80/20 split keeps growth high while adding some stability.
Retirement is 15-20 years away. You still need growth but cannot afford to start over after a crash. A 70/30 mix balances both needs.
This is also a good time to check if you are on track. Use our FIRE calculator to see your retirement number.
10-15 years out. The sequence of returns risk starts to matter. A big crash right before retirement can set you back years. A 60/40 split is the classic balanced portfolio.
In or near retirement. You need your portfolio to last 20-30 more years. Too conservative and inflation eats your purchasing power. Too aggressive and a crash forces you to sell at a loss. A 50/50 mix is a solid middle ground.
Track your dividend income with our dividend calculator.
Target date funds show exactly what big firms recommend. Vanguard's Target Retirement 2065 (for someone age ~25) holds 90% stocks and 10% bonds. Their 2035 fund (for someone ~55) holds 65% stocks and 35% bonds. Fidelity's Freedom funds follow a similar glide path.
If you want the simplest possible approach, a single target date fund from Vanguard, Fidelity, or Schwab matches your allocation to your age automatically. No rebalancing needed.
Knowing the target is step one. Knowing where you actually stand is step two. Enter your current holdings into the portfolio visualizer and compare your pie chart to the targets above. If stocks have drifted above your target, it might be time to rebalance.
Check your allocation against the targets. Free pie chart in 60 seconds.
Open Portfolio Visualizer