Age is a rough proxy for what really sets your mix: how many years the money has to run, and how steady your income is.

Almost every rule about how to split money between shares and safer assets uses age as its input, because age is easy to know. What the research actually cares about is two things age only approximates: how long the money has to run before it is spent, and how much of your future income is already safe. This article traces the common rules to their sources, shows what the target-date industry does with your age, and sets out the evidence that the safest point to hold the fewest shares is around the day you stop work — not at the end of life.

Where “100 minus age” came from

The best-known version is John Bogle’s. The Vanguard founder’s rule of thumb was to own roughly the same percentage of bonds as your age, so a 30-year-old holds 30% in bonds and 70% in shares¹. Written the other way round it becomes “100 minus your age in shares”. Variants such as “110 minus age” and “120 minus age” are widely repeated, usually justified by longer lives and lower bond yields than when the rule was first written; none has a single author or a study behind it, and they are best read as a more aggressive version of the same straight line.

The straight lines have one virtue — they are easy to follow — and one flaw: they move every year whether or not anything about your money has changed. A 40-year-old with a secure public-sector pension and a 40-year-old freelancer with no pension are told the same thing.

Target-date funds: the glide path as a product

Target-date funds turned the age rule into a product, and they now hold a large share of American workplace savings. Vanguard’s How America Saves 2026 reports that 96% of the plans it administers offer target-date funds, and 69% of participants have their money in a professionally managed allocation such as a target-date fund³. Morningstar counts $4.8 trillion in target-date strategies at the end of 2025, up 20.3% in a year⁴.

Vanguard’s default path holds 90% in shares early in a career, begins cutting them gradually around age 40, adds short-term inflation-protected government bonds from about 60, sits at about 50% in shares at 65, and reaches its final mix of 30% shares and 70% bonds at 72 — the age its research finds withdrawals most commonly begin². Across the industry, the median target-date series holds 93% in shares 45 years from retirement⁴, and in Morningstar’s 2022 survey the median held about 43% at the target date itself⁵.

“To” versus “through”

Glide paths split into two designs. A “to” path stops changing at the target date and holds its most conservative mix from that day. A “through” path keeps reducing shares for another 10 to 20 years after the target date, so it usually holds more in shares on the day itself⁵. Morningstar found that four-fifths of the 28 series launched in the decade to 2022 used a “through” design⁵. The difference matters most for the reader of this article: a “to” fund assumes the money is spent soon after the date; a “through” fund assumes it must last decades more.

The case for adding shares after you stop

In 2013 Wade Pfau and Michael Kitces turned the conventional path upside down. Their simulations started retirement with few shares and raised the share over time. A path from 30% to 70% in shares succeeded slightly more often than a static 60/40 mix — 95.1% against 93.2% — while holding less in shares on average⁶. In the bad cases it mattered more: at the fifth percentile the rising path lasted the full 30 years against 27.7 for the static mix⁶. The paper was published in the Journal of Financial Planning in January 2014⁷.

The logic follows from sequence of returns risk. The years just before and after stopping work are when a portfolio is largest and when a crash does the most lasting damage, because withdrawals lock losses in. Holding fewest shares at that moment, then letting the share drift up as the danger window passes, protects the vulnerable years. If markets do well early, the rising path lags — it is insurance, and insurance costs something in the good outcomes.

What changes for early retirees

Stopping at 45 rather than 65 changes two things at once. The horizon lengthens, so the money must outrun inflation for longer; and the danger window still sits at the start, with decades left to compound any early damage. Morningstar’s 2026 estimates for a portfolio of 40% shares at a 90% chance of success fall from 3.9% a year for 30 years to 3.3% for 40 and 2.9% for 50⁸. In that study, higher share allocations generally produced lower safe starting rates for a fixed inflation-adjusted withdrawal, though longer horizons tolerated slightly more in shares⁸.

Karsten Jeske’s Early Retirement Now series reaches a complementary result for 60-year horizons using US data back to 1871: a path rising from 60% to 100% in shares over roughly eight to eleven years supported a fail-safe withdrawal of roughly 3.4% to 3.5%, against 3.14% for a static 80% mix⁹. He also stresses the cost: the rising path underperforms when markets rally early⁹. The two studies differ in method and in what they count as failure, which is why their equity shares look so different — but both say the first decade, not the average, sets what an early retiree can spend.

Your income is an asset too

The deepest reason age matters is human capital: the value of the earnings still ahead of you. Roger Ibbotson, Moshe Milevsky, Peng Chen and Kevin Zhu set out the idea for the CFA Institute Research Foundation in 2007. A young person’s largest asset is usually future pay, and a portfolio should be built around it: safe, steady earnings behave like a bond, so somebody with them can hold more in shares; earnings that rise and fall with the stock market behave like shares, so somebody with them should hold less risk elsewhere¹⁰. The share falls with age because human capital is spent down year by year until, at independence, almost all wealth is financial.

Milevsky’s shorthand for this is to ask whether you are a stock or a bond. A tenured professor’s salary is bond-like and safe; a stockbroker’s pay is stock-like and risky¹¹. Two 35-year-olds with identical savings can therefore reasonably hold very different mixes. For how pay itself tends to grow across a working life, see how income grows across a career.

From age to jobs: a better question to ask

• Money needed within a year or two has no business in shares, whatever your age: a fall cannot be waited out.
• Money needed in the next several years — the runway after you stop — belongs in steady assets so that a crash never forces a sale.
• Money not needed for a decade or more can carry the volatility that buys long-run growth, and for a long horizon arguably must.
• Steady income still to come — a salary, a pension, rent — counts as a bond-like asset beside the portfolio, and lets the portfolio itself take more risk.

Seen this way, “100 minus age” is a rough average over households, and a target-date fund is that average sold as a product. Both are reasonable defaults for somebody who will not think about it again. Somebody planning to stop early, or carrying a pension, or earning in a volatile industry, can do better by asking what each part of the money is for and when it will be needed.

This is information, not financial, tax or legal advice, and nothing here recommends a fund or a particular mix.

How Nivritee frames your mix