Ask a Fool: How Much of My Retirement Portfolio Should Be in Bonds, and How Should I Invest in Them?

Ask a Fool: How Much of My Retirement Portfolio Should Be in Bonds, and How Should I Invest in Them?

It's absolutely true that bonds (also referred to as fixed-income investments) should be included in every well-rounded retirement portfolio.

As far as asset allocation goes, younger investors should have more of their money in stocks, while older investors should allocate a greater percentage of their retirement assets to bonds. One good rule of thumb that I like to use is to subtract your age from 110. This is the percentage of your portfolio that you should keep in stocks, with the rest in bonds.

For example, if you're 40 years old, stocks should make up roughly 70% of your portfolio, and the other 30% should be in bonds.

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Source: Fool.com