"It's also important to rebalance on an ongoing basis as you get closer to your spending target.As retirement approaches, we need to spend that money, so you want to de-risk your portfolio and build safer asset reserves. Investors age 50 and above really need to take notice of rebalancing. It's time to take some winnings and build safer assets that you could access if you needed to spend from your portfolio. Moving money into high-quality bonds removes risk and takes advantage of current attractive yields."
"Most investors are underallocated in international stocks. Consider your style diversification as well, paying attention to underperforming areas.Review your retirement contributions, to see if you can boost or even max out your company retirement plan for the year. People over 50 can make catch-up contributions, and there are special catch-up contributions this year for people between 60 and 63. You can contribute to IRAs and HSAs until the tax filing deadline."
Rebalancing reduces portfolio risk by trimming high-performing, likely overvalued holdings and redirecting proceeds into lagging assets with more attractive valuations. Rebalancing should increase as spending draws nearer to de-risk portfolios and build accessible, safer asset reserves. Investors age 50 and above should prioritize taking some winnings and allocating funds to high-quality bonds to remove risk while benefiting from attractive yields. Working savers should assess U.S. versus non-U.S. exposure and style diversification, boost or max out retirement-plan contributions, and use catch-up contribution opportunities and IRA or HSA contributions before the tax filing deadline.
Read at Fast Company
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