Asset allocation by age calculator
How much of your portfolio should be in stocks versus bonds? Enter your age and risk tolerance to get a suggested stock/bond mix, see the classic rules of thumb side by side, and watch how your allocation should glide as you approach retirement.
Your profile
Your glide path by age
How the balanced rule shifts your mix toward bonds as you age (stocks floored at 20%).
| Age | Stocks | Bonds & cash |
|---|---|---|
| 40 (now) | 70% | 30% |
| 45 | 65% | 35% |
| 50 | 60% | 40% |
| 55 | 55% | 45% |
| 60 | 50% | 50% |
| 65 | 45% | 55% |
| 70 | 40% | 60% |
| 75 | 35% | 65% |
| 80 | 30% | 70% |
| 85 | 25% | 75% |
| 90 | 20% | 80% |
Rules of thumb at age 40
The three classic formulas at your age — pick the one that matches how you handle risk.
| Approach | Stocks | Bonds & cash |
|---|---|---|
| Conservative · 100 − age | 60% | 40% |
| Balanced · 110 − age | 70% | 30% |
| Aggressive · 120 − age | 80% | 20% |
How asset allocation by age works
Asset allocation is the single biggest driver of your portfolio's risk and return — more than which specific funds you pick. The core idea is to balance stocks (growth, but volatile) against bonds and cash (stable, but lower returning). When you're young you can afford more stocks because you have decades to recover from any crash. As retirement nears, you shift toward bonds so a bad market doesn't wreck your savings just as you start spending them.
Target stocks % = base − your age · base = 100 (conservative), 110 (balanced) or 120 (aggressive)
- A balanced 40-year-old: 110 − 40 = 70% stocks, 30% bonds.
- The same person at 65: 110 − 65 = 45% stocks — the glide path in action.
- Stocks are floored at 20% so even an older portfolio keeps some growth against inflation.
Choosing your risk tolerance
The right base number comes down to how you'd behave in a downturn. Conservative (100 − age) suits investors who'd lose sleep over a big drop or who'll need the money soon. Balanced (110 − age) is a sensible default for most people. Aggressive (120 − age) fits those with a long horizon, stable income and the temperament to hold through volatility. The best allocation is the one you can actually stick with — selling in a panic at the bottom is far more damaging than picking a slightly "wrong" mix.
When does an 80–90% stock allocation make sense?
A very high stock weight — 80%, 90%, even 100% — isn't reckless for the right person; it's often the optimal choice. The aggressive (120 − age) rule already puts a 30-year-old near 90% stocks, which is exactly how most target-date and all-in-one growth funds invest early savers. The case for running that hot rests on a few things:
- A long time horizon. With 20–40 years before you touch the money, you have time to ride out — and recover from — even a severe crash. Every long historical stretch has rewarded patient equity investors.
- High risk capacity. Steady employment, an emergency fund, and no near-term need for the cash mean a paper loss never forces you to sell at the bottom.
- You're still contributing. In the accumulation years, a downturn lets you buy more shares cheaply — falling prices become an opportunity instead of a threat.
- Guaranteed income covers the basics. A defined-benefit pension or sizeable CPP/OAS behaves like a giant bond, so even some pre-retirees can justify 70–90% stocks in the portfolio they actually control.
The catch is behaviour. An 80–90% portfolio can drop 40% or more in a bad year, and the approach only pays off if you hold through it. If a fall like that would push you to sell, dial the stock weight down to a level you can live with — a mix you'll stick with beats a "better" one you'll abandon at the worst moment.
Count guaranteed income as bonds
If you have a defined-benefit pension, or sizeable CPP and OAS, that steady lifetime income behaves like a large bond holding. That can free you to hold more stocks in the portfolio you actually control, since your essential spending is already covered. The rules of thumb here look only at your investable portfolio, so adjust upward on stocks if a big chunk of your retirement income is guaranteed.
Putting your allocation to work
Build & grow the portfolio
- See how your mix compounds over time with the compound interest calculator.
- Watch fees — high MERs quietly erode returns, per the investment fee calculator.
- Estimate income from the stock side with the dividend income calculator.
Plan the drawdown
- Find the nest egg you need with the how much to retire calculator.
- Test how long it lasts with the safe withdrawal rate calculator.
- Keep a few years of spending in bonds and cash so you never sell stocks in a slump.
What these rules don't capture
The "X minus age" rules are starting points, not a full financial plan. They ignore your goals, other assets, taxes, and exactly how the stock and bond slices are built (Canadian vs. global equity, bond duration, GICs). They also assume a single risk level for life. Use the suggested mix as a sanity check against your current portfolio, then refine it with your full situation — and consider a fee-only advisor for big decisions.
Frequently asked questions
What is asset allocation by age?
Asset allocation is how you split your portfolio between growth assets (stocks) and stabilizers (bonds and cash). The "by age" idea is simple: the younger you are, the more time you have to ride out market dips, so you can hold more stocks. As you near and enter retirement you shift toward bonds to protect against a crash right when you start drawing income. This calculator turns your age and risk tolerance into a suggested stock/bond mix and shows how it should glide over time.
What does the "100 minus age" rule mean?
It's the oldest rule of thumb: subtract your age from 100 to get your target stock percentage. At 40 that's 60% stocks, 40% bonds; at 65 it's 35% stocks. Because people live longer and bond yields have been low, many advisors now use 110 minus age (a balanced tilt) or even 120 minus age (aggressive) to keep more growth in the portfolio. Pick the rule that matches your risk tolerance — this tool does the math for all three.
How much should I have in stocks versus bonds at my age?
There's no single right answer, but the rules of thumb give a sensible starting range. A balanced investor might hold (110 − age)% in stocks — about 70% at 40, 55% at 55, and 45% at 65. More conservative investors lean toward 100 − age; those comfortable with volatility and with a long horizon use 120 − age. The table above shows your mix for each rule so you can see the spread and choose.
Is the 100-minus-age rule still good advice?
It's a useful anchor, but many planners think it's too conservative today. A 65-year-old could easily live another 25–30 years, so holding only 35% stocks risks running out of growth. That's why the 110 or 120 minus age versions have become popular. The rule also ignores your actual risk tolerance, other income like CPP and OAS, and whether you have a pension — treat it as a starting point, not a prescription.
What's the right mix once I'm retired?
Most retirees keep a meaningful stock allocation — often 40–60% — because retirement can last 30 years and inflation erodes an all-bond portfolio. A common approach is the bucket or glide-path strategy: hold a few years of spending in cash and bonds so you never have to sell stocks in a downturn, while the equity portion keeps growing. The glide path above floors the stock weight at 20% so even older portfolios keep some growth.
Conservative, balanced or aggressive — which should I choose?
Choose based on how you'd react to a 30% drop. If you'd panic and sell, go conservative (100 − age). If you'd hold steady and have a long horizon plus stable income, aggressive (120 − age) may suit you. Balanced (110 − age) is a sensible middle for most people. The best allocation is one you can actually stick with through a bad market — the worst mistake is selling at the bottom.
How should I split the stock portion of my portfolio?
A common, low-cost approach (the "couch potato") splits equities across Canadian, U.S. and international stocks — often roughly a third each, or weighting global markets and keeping a Canadian home-bias slice. You can do this with two or three broad index ETFs, or a single all-in-one asset-allocation ETF that holds the whole stock/bond mix for you. Watch the fees — see the investment fee calculator for how much MERs cost over time.
Should I count my home, pension, CPP or OAS in this?
This calculator looks only at your investment portfolio. But your full picture matters: a defined-benefit pension or CPP/OAS acts like a big bond (steady, guaranteed income), which can let you hold more stocks in the portfolio you control. Your home is generally not counted as an investable asset for allocation. Factor guaranteed income in with the how much to retire calculator.
Is an 80–90% stock allocation too aggressive?
Not necessarily. For a young investor decades from retirement, a 90% (or even 100%) stock allocation is a mainstream choice — it's how most target-date funds invest early savers, and the aggressive 120 − age rule puts a 30-year-old near 90%. It makes sense when you have a long time horizon, steady income, an emergency fund, and you're still contributing (so a downturn lets you buy cheap). The real test is behavioural: an 80–90% portfolio can fall 40% or more in a bad year, and the strategy only works if you hold through it instead of selling at the bottom. If that kind of swing would rattle you, pick a lower, calmer mix you can actually stick with.
Is this calculator financial advice?
No. It applies well-known rules of thumb to your age and risk tolerance for educational purposes. Your ideal allocation depends on your full financial situation, goals, time horizon, taxes and temperament. Use this as a conversation starter and consider a fee-only advisor before making big changes to how your money is invested.
Educational tool, not financial advice. The suggested mixes are well-known rules of thumb and do not account for your full financial situation, goals, taxes or risk capacity. Investing involves risk, including possible loss of principal. Consider professional advice before changing how your savings are invested.