Investment Types

Often it is suggested that an investor's balance of two categories should be linked to the owner's age.  Such as in your 50s, the equities (stocks) vs. fixed (bonds) should be 50/50.  In your 60s, 40/60 with more fixed or bond investments versus stocks.  The thinking being less risk later in life.

As our time on earth shortens, we have less time to recoup after stock market downs and even corrections.  If you were 70s in 2008, that portion of your portfolio would have taken quite a hit.

The other side is if you were not in the market in 2013 you would have missed a year where equities increased near 25%.

So my challenge this weekend was to look at each of our mutual fund holdings and break them out Stocks vs Bonds.  I found a website that shows the percentages of these plus cash holdings.

http://funds.ft.com/us/

Most of my followers know I compile a balance sheet showing our investments both inside and outside of retirement accounts at the end of each quarter.  I took my year end sheet and broke out by percentages found on the above website.

Findings show that we hold larger holdings in Stocks within our IRAs/401(k) than Bonds but virtually 50/50.  Our holdings outside retirement accounts is roughly 35/65.  Now we know and we need to decide about rebalancing things.

Since Bob and I are approaching our mid-60s, our balance should be 40/60 or 35/65.  So we are not far off.  I did count cash holdings as fixed or bond. 

'til later