Does the "100 Minus Your Age" Investing Rule Still Work? What Wes Moss Thinks

"Wes Moss states that the 100-minus-your-age rule is a very antiquated, overly crude rule of thumb that he does not subscribe to at all."

"A portfolio that is 85% bonds and 15% stocks faces a serious inflation problem over that time horizon, as inflation erodes the purchasing power of a bond-heavy portfolio."

"The 4% withdrawal rule remains relevant, calling for retirees to withdraw 4% of their retirement accounts in the first year, adjusting for inflation thereafter."

"Moss emphasizes that a 15% stock allocation is not just conservative; it is structurally incompatible with the withdrawal math that underpins most retirement income planning."

The 100-minus-your-age rule suggests that retirees should hold a percentage of stocks equal to 100 minus their age. This formula is outdated, particularly for those over 80, as life expectancy has increased. A portfolio with 15% in stocks may not withstand inflation and could lead to insufficient funds for retirement. The 4% withdrawal rule remains relevant, requiring at least 50% in stocks for sustainable income. This approach contrasts sharply with the conservative stock allocation suggested by the 100-minus-your-age rule.

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