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Diversify Y our Investment Por tfolio

prefer to buy individual stocks or bonds, a great way to learn about investing
is to visit fund web sites and research their holdings.

1. You’re 25 years old and single . After setting aside 10 percent or so for
cash reserves, you should invest for long-term growth. So invest your
assets as follows:
Large-company growth and blend: 15 percent
Mid-cap growth and blend: 20 percent
Small-cap growth, blend, value: 25 percent
International: 30 percent
Cash: 10 percent
2. You’re 35, married, with young children, investing for their college educa-
tions and your retirement . Since each goal has a long time horizon, you
should continue to invest for long-term growth. You can keep the
same 60-30-10 mix as when you were 25, so you’re still in situation 1.
Just invest it a little more conservatively, in terms of both category mix
and the choices in each category:
Large-company growth, blend and value: 25 percent
Mid-cap growth and blend: 20 percent
Small-cap growth, blend, value: 15 percent
International: 30 percent
Cash: 10 percent

3. You’re 45, with two children approaching college age . Assets earm arked

for their educations could be shifted into more conservative funds. For
example, shift to bond funds with short average maturities, to provide
protection from interest-rate swings.
But you probably have at least 10 years, and possibly 20, until you
retire. So assets you won’t need until then should remain in growth-
oriented investments. You fall into situation 2:
Large-company blend and value: 25 percent
Mid-cap growth, blend and value: 15 percent
Small-cap blend and value: 10 percent
International: 20 percent
Bonds: 15 percent
Cash: 15 percent
4. You are in your late 50s, approaching retirement . You should still be
investing for growth and income, but in more conservative categories
and individual vehicles:
Large-company blend and value: 30 percent

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