8 rules of thumb on saving and retirement
Stocks vs. bonds
The rule: The percentage of your portfolio invested in bonds should equal your age.
Why it works: This rule of thumb helps investors keep in mind that their portfolios need to change as they age. 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.