I’m 46 years old, and my retirement savings are invested in Vanguard’s target date 2045 fund. I’m thinking of switching to pure funds (US stock index, international stock index, and bond index) to have more control over the asset allocation; or alternatively, I could choose an earlier target date fund with a different allocation. The 2045 fund is currently 83% stocks and 17% bonds/short-term reserves.
From what I’ve read, 83-17 is a very aggressive asset allocation for someone my age. (For instance, my age in bonds would suggest a roughly 55-45 allocation.) I took the Vanguard risk tolerance quiz and it also suggested an 80-20 allocation for me.
Assuming that I’m confident that I will *not* panic and sell during the next market downturn, no matter how much my portfolio is decimated, is there any other reason not to stick with this aggressive allocation? I guess my only concern is whether 20 years is enough time to recover from a crash.
This is the entire Vanguard glide path for target date funds:
https://institutional.vanguard.com/inve ... -path.html
Age 20: 90-10
Age 40: 90-10
Age 60: 60-40
Age 65: 50-50
Age 72: 30-70
From what I’ve read, 83-17 is a very aggressive asset allocation for someone my age. (For instance, my age in bonds would suggest a roughly 55-45 allocation.) I took the Vanguard risk tolerance quiz and it also suggested an 80-20 allocation for me.
Assuming that I’m confident that I will *not* panic and sell during the next market downturn, no matter how much my portfolio is decimated, is there any other reason not to stick with this aggressive allocation? I guess my only concern is whether 20 years is enough time to recover from a crash.
This is the entire Vanguard glide path for target date funds:
https://institutional.vanguard.com/inve ... -path.html
Age 20: 90-10
Age 40: 90-10
Age 60: 60-40
Age 65: 50-50
Age 72: 30-70
Statistics: Posted by frwyk — Fri Dec 13, 2024 11:02 am