Q. I’m about a decade from retiring, and watching the ups and downs on Wall Street. How should my portfolio be divided in this volatile market?
A. Based on your goal, you’ll need to adjust your portfolio appropriately. Experts suggest that you may want to keep 20 to 40 percent of your portfolio in safe, fixed-income investments such as bonds and CDs, and put the rest of your funds in equities over the next year or two. That way, your portfolio is geared toward growth. But make sure your equities are diversified. You should be spreading your money around in U.S. stocks, international stocks, growth and value stocks, little and big companies.
As you near retirement, you’ll need to adjust your portfolio from equities toward a more conservative mix. Consider talking with a financial professional to create a plan. To find a fee-based financial planner, go to the National Association of Personal Financial Advisors (847-483-5400) or the Financial Planning Association (1-800-322-4237).
Source: Tim Bearden, Stonebridge Financial Partners, Bingham Farms, Mich.