The age of a person determines what would be the best investment portfolio for his or her future. Whether to invests more in equities and less in fixed income or less in equities and more in fixed income depends on the age of the person. As a simple rule, the less the age the more risk a person can take because he or she has more years to earn money.
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| Portfolio Vs Age |
However, one must remember that fixed income cannot compete with ever-rising inflation. It is equities that can compete with the increasing inflation and hence everyone must have some equity in his or her portfolio. Also it is important to diversify fixed income investment to different tools like government bonds, fixed deposits and debentures etc.
Below table will explain how to manage portfolio based on age:
Age | Portfolio |
| Above 60 | 40% in Stocks and Mutual Funds 10% in Cash 50% in Fixed Income |
| 50 to 60 | 50% in Stocks and Mutual Funds 10% in Cash 40% in Fixed Income |
| 40 to 50 | 60% in Stocks and Mutual Funds 10% in Cash 30% in Fixed Income |
| 30 to 40 | 70% in Stocks and Mutual Funds 10% in Cash 20% in Fixed Income |
| Below 30 | 80% in Stocks and Mutual Funds 10% in Cash 10% in Fixed Income |
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