Holdings by Age
When it comes to retirement planning, allocations should be largely driven by time horizons, said John Cavanaugh, a chartered retirement planning counselor with Cavanaugh Financial Group in Plymouth, Minn.
“For someone who has 20 to 30 or more years to retirement, it often makes sense to allocate 60 percent or more to stocks,” he said. “For someone closer to retirement, say five years or less, investment planning gets much more delicate. It’s natural to scale back the stock holdings: Often 40 percent or less makes sense.”
For those in or on the verge of retirement, a big market drop can steer a portfolio off course if their stock exposure was too heavy, Brimhall added.