ASSET ALLOCATION CALCULATOR

Select a profile that's right for you. The profiles

below will help you tailor your allocations to align
with your risk tolerance.

Very Conservative

Conservative

Moderate

Aggressive

Very Aggressive

Stocks 80%
Bonds 15%
Cash 5%

Overview Details

Aggressive
Typically, an aggressive investor is:

primarily focused on pursuing portfolio

appreciation over time

usually an experienced equity investor

can tolerate market downturns and volatility for

the possibility of achieving greater long-term
gains

someone who won’t need the money from their

investments for 10 years or more

someone with a portfolio that has exposure to

various asset classes but primarily invested in
equities

At year 10, 1.7% of portfolios are losing money.

SmartAsset does not make recommendations on
securities

About This Answer !

Our Assumptions !

Our Investing Expert !

Aggressive Risk Profile Expected Range of

Return

$30M

$25M

$20M

$15M

$10M

$5M

$0
2025 2030 2035 2040 2045 2050
Year

Starting Balance

$ 1,249,999

How your assets will grow over 30 years

50% confidence your portfolio will be worth between
$10,205,353 - $25,148,300
Median expected return $16,119,388

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Asset Allocation
Calculator

Photo credit: © iStock/lukas_zb

Once you've decided to start investing your

money, you'll have to decide on an asset
allocation that's appropriate for your goals, age
and risk tolerance. And unless you invest in a
target date fund that automatically adjusts that
asset allocation, you'll have to rebalance your
assets over the course of your investing time
frame.

A financial advisor can help you manage your

investment portfolio. To find a financial
advisor who serves your area, try our free
online matching tool.

Stocks
When you buy shares in a company you're
investing in stocks. This is also known as owning
equities. Companies issue stocks as a way of
raising money and spreading risk. Some pay
dividends to their shareholders. As a shareholder,
you can make money through dividends, from
selling the stock for more than you paid or from
both. The value of shares fluctuates. The goal is
generally, as you’ve likely heard, to "buy low and
sell high."

You don't have to buy shares in individual

companies to invest in stocks. You can also buy
mutual funds, index funds or exchange-traded
funds (ETFs). Individual stocks, mutual funds, index
funds and ETFs all have something in common:
they have the potential for relatively high returns,
but also for relatively high risk.

Buying stocks comes with what's called "equity

exposure," the risk that the shares you own could
fall in value or become worthless. This could be
due to a problem with the specific company that
issued the shares or it could be caused by a
general stock market crash. If you want your
money to grow substantially over time, you'll need
at least some equity exposure. How much you
decide to allocate to stocks will depend on your
goals, age and risk tolerance.

Bonds

Photo credit: © iStock/NI QIN

Bonds are the foil to stocks. They're the slow-

and-steady refuge when stocks aren't
performing well. When you buy stocks you
become a partial owner. With bonds, by
contrast, you're a lender instead of an owner.
Companies and governments issue bonds to
raise money. US Treasury bonds are generally
considered a rock-solid investment because
there's virtually no risk that you'll stop receiving
interest or that you could lose your principal.

Your principal? That's the amount you pay for a

bond. Your bond will come with a coupon rate that
represents the percentage of your principal that
you'll receive as an interest payment. You keep
earning interest until the bond's maturity date. If
you put all your money in bonds you probably
wouldn't earn enough to beat inflation by much,
depending on interest rates.

Cash
Cash gives your assets some liquidity. The more
liquid an investment is, the more easily and
quickly you can access it and put it to use. In
investment speak, "cash" doesn't necessarily
mean a pile of Benjamins under the mattress.
Keeping money in cash could mean putting it in a
high-yield savings account or a short-term bond or
CD.

Cash gives you flexibility and acts as a buffer

against equity risk. But if you keep all your money
in cash you probably won't beat inflation. This
means your money would lose real value over
time. On the other hand, if you didn't have any
cash assets you could be scrambling for liquidity
in the event of a big expense like a medical
emergency or period of unemployment.

Your Goals
If your goal is to create an emergency fund that
you might need to access at any time, the liquidity
that cash offers is a major asset. On the other
hand, if your goal is very early retirement (also
known as financial independence), you likely need
to invest heavily in stocks to get the kind of
returns you'll need to grow your money by a
significant amount in a short time.

We all deal with overlapping - sometimes

competing - financial goals. We want to save for
retirement but we also want to save for a house.
We want enough money to live on in retirement
but we also want a little extra money to leave to
our children as an inheritance. Our priorities
change over time, which is why keeping an eye on
your asset allocation and rebalancing periodically
is so important.

Your Age

Photo credit: © iStock/webking

Say you want to retire at age 67. What would

you do if your investment portfolio lost 30% of
its value when you hit age 65? Would you have
enough money left to stick to your plan and
retire at 67, or would you have to stay in the
workforce for longer than you intended? Most
people can't afford much volatility in the value
of their portfolio so close to retirement.

That's why it's generally suggested that you

allocate relatively more to bonds as you get closer
to retirement. If you have an asset allocation of
90% stocks and 5% cash and 5% bonds at age 60,
you'll have high potential for growth but also high
risk. That's a very aggressive portfolio for
someone of that age. If you have an asset
allocation closer to 45% stocks, you'll end up with
lower risk that your net worth might take a dip you
can't afford. On the other hand, having 0% in
stocks might not earn you enough over the next 7
years to get you ready for retirement.

Your Risk Tolerance

We've already talked about how investing in
stocks comes with the risk that your net worth
could drop. Some people tolerate risk better than
others. If you're very risk averse, you won't want to
keep 90% of your assets in stocks. If you like the
thrill of risk and you don't mind experiencing ups
and downs, a high percentage allocated to stocks
won't phase you.

The key to thinking about risk tolerance and

investing is balancing your innate risk tolerance
with the other two factors discussed above - your
goals and your age. For example, if you reach age
65 and you're as risk-loving as ever, you might
want to let your age and your goal of impending
retirement moderate your aggressive investment
strategy. If you're a conservative investor, but
you're 22 and earning an entry-level salary, you
might want to overcome your conservative
instincts and bump up your stock allocation so
that you'll save enough for retirement. You get the
idea.

Bottom Line
Allocating your assets is a personal decision and
it's not a decision to make once and then forget
about. Say you set your portfolio to be 80%
stocks, 15% bonds and 5% cash. If you reinvest the
dividends from your stocks, you'll eventually end
up with a higher proportion in stocks than the 80%
you started out with. Not to mention the fact that
you'll probably want to change your asset
allocation as you age and your goals change. It's
your money – it’s important to put it to work in the
way that makes sense for you.

Most Generous Counties in the

U.S.
The interactive version of this map is only
available on Desktop devices.

The below map of the U.S. highlights the places

that make the most charitable contributions. The
study takes into account charitable contributions
as a percentage of net income and the proportion
of taxpayers that made a charitable contribution of
any amount in a given county. Scroll to view the
data and methodology for how the study was
researched and compiled.

Most Generous Counties in the U.S. data map

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