The markets continue to provide difficult options to investors. In the typical market conditions of the last 50 years I think a sensible portfolio allocation was not that challenging to pick. I would choose a bit more in stocks than bonds than the commonly accepted strategy. And I would choose to put a bit more overseas and in real estate.
But if that wasn’t done and even something like 60% stocks and 40% bonds were chosen it would seem reasonable (or 60% stocks 25% bonds and 15% money market – I really prefer a substantial cushion in cash in retirement). Retirement planning is fairly complex and many adjustments are wise for an individual’s particular situation (so keep in mind this post is meant to discuss general conditions today and not suggest what is right for any specific person).
This post was written before #covid19 became the enormous economic clamity it has become. Based on the poor preparation to fight Covid19 by the USA and Europe I sold some stocks and reduced global exposure and emeriging market exposure. I didn't reduce it to zero or anything close to that, but as I say I am usually overweight stocks and I had reduced how much I was overweight due to high stock valuations and with the likely Covid 19 problems I further reduced stocks to make my portfolio probably even a little bit underweight stocks (but still over 50% stocks).
I am more active than most people should be with their investments (I think it works for me but maybe I should be less active too, I just pay much more attention than most people and feel I can make some adjustments that are sensible.).
continue reading: Retirement Portfolio Allocation for 2020