The 100-minus-your-age rule: Subtract your age from 100, and that number is the % of your portfolio that belongs in stocks.
This outdated formula might not make sense with people living longer.
The rule also inhibits the growth of large portfolios which are to be passed to heirs.
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The 100-minus-your-age rule has been handed down through decades of personal finance advice without much scrutiny. The idea is simple: Subtract your age from 100, and that number is the % of your portfolio that belongs in stocks. An 85-year-old, by this logic, should hold just 15% in equities. But does this strategy make sense in 2026?
Wes Moss, the Atlanta-based retirement planner and host of the “Ask An Advisor” segment on The Clark Howard Podcast, has a direct verdict on that formula: “It’s a very antiquated, overly crude rule of thumb that I do not subscribe to at all.”
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The 100-minus-your-age rule was built for a world where retirement lasted 10 to 15 years and inflation was manageable background noise. Today, a woman reaching 85 has a meaningful probability of living another decade or more. A portfolio that is 85% bonds and 15% stocks faces a serious inflation problem over that time horizon.
After topping out at 7% during the pandemic, inflation has dropped to less than 3%. But it drifts steadily upward and erodes the purchasing power of a bond-heavy portfolio. A fixed income stream that covers today’s assisted living costs may fall short in five years.
In a recent podcast episode, Moss said the 4% withdrawal rule remains relevant. It’s the most widely used framework for sustainable retirement spending, calling for retirees to withdraw 4% of their retirement accounts in the first year, and then adjusting for inflation in subsequent years. Moss said the rule is predicated on holding at least 50% in stocks, with the research supporting allocations up to 75% equities. So a 15% stock allocation is not just conservative. It is structurally incompatible with the withdrawal math that underpins most retirement income planning.
Moss noted that even Vanguard founder John Bogle, who popularized the “own your age in bonds” version of this rule, eventually backed away from it.
The more powerful concept Moss introduced is one most people managing parental assets never consider. “Very often the investment portfolio for your family or for your parents might have the time horizon of the whole family.” He explained that if substantial assets will pass to heirs, “very often family members will say, really, I’m investing this for me, but also for my kids — and they have a much longer time horizon. So that can make it more appropriate to have 50, 60, 70% in stocks because you’re looking at two timelines, not just one.”
So an 85-year-old with more than enough money to cover expenses through age 100 might not invest like a typical octogenarian. They might invest more like a 55-year-old, with an eye on growing the funds to be left to heirs.
David from California wrote in to Moss’s show, explaining that advisors from Schwab and Oppenheimer had recommended moving his mother and mother-in-law, both in their late 80s, toward a 60-40 stock-to-bond split. His instinct was to push back, citing the age-based rule. But Moss said the advisors were likely right.
The 60-40 recommendation could make sense in a multi-generational time horizon argument. With 10-year Treasury yields near 4.3%, bonds do offer more real income than they did a decade ago. But a portfolio built entirely around capital preservation for two women in their late 80s ignores the decades-long horizon of the assets that will survive them.
Moss recommended talking to the advisors about the actual time and spending needs of both women. This discussion might include:
A clear monthly spending number: What do current care costs actually total, and what does Social Security or pension income already cover? The gap is what the portfolio must fund, and that number drives the appropriate withdrawal rate.
An honest assessment of estate intent: If assets are likely to pass to heirs, the portfolio’s effective time horizon extends well beyond either woman’s life expectancy. That changes the stock allocation math.
A comparison against the 4% rule: Run the current portfolio balance against annual withdrawals needed. If the withdrawal rate is well below 4%, a more aggressive allocation is sustainable. If it is above 4%, the conversation shifts toward income stability over growth.
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