The general rule: the younger you are, the higher the yield (and the risk)
Time is your ally when managing your money: it dilutes risk and improves yield when investing.
- When you are young, try to maximize the yield even if this means taking on a little more risk. Invest more in equities.
- As the years go by, try to consolidate what you have earned by reducing the risk of your investments. Reduce variable income, increase fixed income investments.
Take advantage of the rule of 120
What is this rule? A formula created by John Bogle to decide what percentage to invest in equities and what percentage in fixed income.
How does it work? You subtract your age from 120 and that is the percentage to invest in equities (higher yield and risk).
Objectives and type of investment according to your age
0-18 years
Mom and dad are the decision-makers. What should they do?
- Goals: long-term savings.
- Objectives: save and invest for the future.
- Strategy: long-term growth investments.
- Products*: investment funds, stocks, portfolios of funds, PIAS.
* Child savings accounts are fine, but they do not offer great returns.
18-30 years
| Goals | Save every month Start investing Create your emergency fund Define your medium-term financial goals |
| Objectives | Create your savings plan Create your investment plan for the short and long term |
| Strategy | Long-term growth investments |
| Products | Investment funds, stocks, fund portfolios, PIAS, pension plans |
30-50 years
| Goals | Increase income and savings Define short, medium and long term goals (children, children’s education, retirement. etc.) |
| Objectives | Diversify investments Consolidate part of the earnings |
| Strategy | Start reducing equity exposure |
| Products | Investment funds, stocks, portfolios, PIAS |
50-67 years
| Goals | Increase income and savings Redefine medium-term goals |
| Objectives | Maintain investment by reviewing asset allocation |
| Strategy | Consolidate the gains obtained Reduce exposure to equities |
| Products | Investment funds, stocks, fund portfolios, PIAS, guaranteed products (from 60 years) |
67-…
| Goals | Plan the withdrawal of investments |
| Objectives | Stretch savings to the maximum Have an adequate income for retirement |
| Strategy | Keep the investment part of the portfolio Conservative investment strategies |
| Products | Investment funds, annuities, fund portfolios, PIAS, guaranteed products |
