Educational allocation frameworks based on your horizon and risk tolerance — plus what fees would cost you.
Suggested equity allocation
75%
75% stocks / 25% bonds / 0% cash
4.75% after inflation
At 35 with 25 years and a moderate risk tolerance, a common educational framework — roughly "110 minus your age" in equities, adjusted for how you'd actually behave in a downturn — suggests about 75% stocks, 25% bonds and 0% cash. This is a starting framework, not a recommendation — your full situation, other assets and tax position all matter.
Contributing $800 a month on top of $25,000 at an expected 7.75% net return reaches $903,081 in 25 years. You'd contribute $265,000, so $638,081 is growth. After 3% inflation the purchasing power is $431,316 — the number worth planning against.
Your 0.50% in annual fees costs $75,788 over 25 years, because fees compound against you exactly as returns compound for you. Broad-market index funds commonly charge 0.03–0.10%. This is also the only variable in the entire projection you can change with certainty — you can't control returns, but you can control what you pay.
Model fee impactWhere you invest is worth as much as what you buy, because the tax treatment differs sharply. The standard priority: 401(k) to the full employer match, then an HSA if you're eligible, then an IRA, then back to the 401(k) to the annual limit, then a taxable brokerage. Skipping an employer match to invest elsewhere is the most expensive common mistake in investing.
Check your matchThese are general frameworks based on age and horizon. They don't account for your other assets, tax situation, job stability, dependents or goals — all of which change the right answer. Use this to understand the principles, then talk to a fee-only fiduciary advisor before acting on a significant sum.
Worked scenarios with the full analysis, so you can see how the numbers move before entering your own.
A standard long-horizon accumulation profile where equities dominate.
Suggested equity allocation
75%
At 35 with 25 years and a moderate risk tolerance, a common educational framework — roughly "110 minus your age" in equities, adjusted for how you'd actually behave in a downturn — suggests about 75% stocks, 25% bonds and 0% cash. This is a starting framework, not a recommendation — your full situation, other assets and tax position all matter.
Contributing $800 a month on top of $25,000 at an expected 7.75% net return reaches $903,081 in 25 years. You'd contribute $265,000, so $638,081 is growth. After 3% inflation the purchasing power is $431,316 — the number worth planning against.
Your 0.50% in annual fees costs $75,788 over 25 years, because fees compound against you exactly as returns compound for you. Broad-market index funds commonly charge 0.03–0.10%. This is also the only variable in the entire projection you can change with certainty — you can't control returns, but you can control what you pay.
Model fee impactA shorter horizon and conservative tolerance shift the mix toward bonds.
Suggested equity allocation
37%
At 58 with 8 years and a conservative risk tolerance, a common educational framework — roughly "110 minus your age" in equities, adjusted for how you'd actually behave in a downturn — suggests about 37% stocks, 63% bonds and 0% cash. This is a starting framework, not a recommendation — your full situation, other assets and tax position all matter.
Contributing $2,200 a month on top of $340,000 at an expected 6% net return reaches $819,031 in 8 years. You'd contribute $551,200, so $267,831 is growth. After 3% inflation the purchasing power is $646,551 — the number worth planning against.
Your 0.35% in annual fees costs $16,739 over 8 years, because fees compound against you exactly as returns compound for you. Broad-market index funds commonly charge 0.03–0.10%. This is also the only variable in the entire projection you can change with certainty — you can't control returns, but you can control what you pay.
Model fee impactHorizon overrides risk appetite entirely — market exposure is inappropriate for a firm deadline.
Suggested equity allocation
35%
At 30 with 3 years and a aggressive risk tolerance, a common educational framework — roughly "110 minus your age" in equities, adjusted for how you'd actually behave in a downturn — suggests about 35% stocks, 65% bonds and 0% cash. Your horizon is the binding constraint here: money needed within five years shouldn't carry much market risk regardless of appetite.
Contributing $900 a month on top of $20,000 at an expected 6.15% net return reaches $59,523 in 3 years. You'd contribute $52,400, so $7,123 is growth. After 3% inflation the purchasing power is $54,472 — the number worth planning against.
Where you invest is worth as much as what you buy, because the tax treatment differs sharply. The standard priority: 401(k) to the full employer match, then an HSA if you're eligible, then an IRA, then back to the 401(k) to the annual limit, then a taxable brokerage. Skipping an employer match to invest elsewhere is the most expensive common mistake in investing.
Check your matchRisk tolerance describes how you feel; time horizon describes what the money has to do. When they conflict, horizon wins.
An aggressive investor saving for a house purchase in two years should not be in equities, because a 25% decline the year before the purchase is unrecoverable on that timeline. A conservative investor 30 years from retirement holding only cash faces a different and larger risk — inflation quietly removing half their purchasing power. Matching the asset to the deadline is the first decision, and the appetite question only applies within what the horizon allows.
Investors spend enormous energy choosing between funds and very little on what those funds cost, which is backwards. You cannot control returns; you can control fees precisely.
A 1% annual fee against a 7% return sounds like a seventh of the gain. Over 30 years it consumes closer to a quarter of the final balance, because each year's fee also removes the compounding that money would have produced for every remaining year. Moving from 1% to 0.05% is the single most reliable improvement available to most retail investors.
Allocation frameworks based on age are useful precisely because they ignore the things that are hard to quantify — and that is also their limitation. They don't know whether you have a pension, a stable government job or commission income, whether you're supporting parents, whether you hold concentrated employer stock, or what your marginal tax rate is.
Each of those legitimately changes the right answer. Someone with a guaranteed pension can hold more equities than the formula suggests, because the pension functions as a bond allocation. Treat the output as a starting point for a conversation, not a conclusion.
A firm deadline inside five years rules out market exposure regardless of how comfortable you are with volatility.
The gap between 0.05% and 1% is roughly a quarter of your final balance over 30 years.
A 50% match is an immediate guaranteed return nothing else approaches.
It feels safe and guarantees inflation erodes purchasing power. Over long horizons that's the larger risk.
Once a year, or when an allocation drifts more than 5 points, is enough. More generates taxes and costs without improving outcomes.
A common educational framework is '110 minus your age' in equities — so 75% stocks at age 35, 50% at 60. Adjust down if a 20% decline would cause you to sell, and adjust down further if you need the money within ten years. It's a starting point, not a prescription.
A broad total-market index fund is a complete portfolio for most people in the accumulation phase. Adding an international fund and a bond fund produces the classic three-fund portfolio, which is hard to improve on. A target-date fund does the same thing in a single holding and rebalances automatically — just check its expense ratio.
Fifteen percent of gross income including any employer match is the standard benchmark for a mid-sixties retirement. Rather than fixating on the target, set the contribution to the highest rate your budget genuinely tolerates and raise it with every pay increase.
No. This tool applies general, age-based allocation frameworks and explains the principles behind them. It doesn't know your other assets, tax situation, job stability or goals, and we're not licensed to give personalized advice. For a significant sum, speak to a fee-only fiduciary advisor.
Historically a lump sum invested immediately beats spreading it out about two-thirds of the time, because markets rise more often than they fall. Spreading it out is a behavioural hedge against regret rather than a mathematical improvement — but if the anxiety would cause you to abandon the plan, it's the better choice despite the lower expected value.
Roughly 9–10% nominal for a diversified equity portfolio based on long-run US history, or 6–7% after inflation. Bonds have historically returned 4–5% nominal. Blend those by your allocation and subtract fees. Assuming conservatively and being pleasantly surprised is far safer than the reverse.
The next calculations that usually follow this one.
See the balance, the split between contributions and growth, and what it actually buys.
Your headline return is not your return. See what survives fees, taxes and inflation.
Not just a number — the age you can retire, the milestones on the way, and what to contribute now.
Your savings rate sets the date far more than your income does. This shows the year.
Translate future dollars into today's purchasing power — the adjustment most plans skip.
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