## Poll: What is your Bond Allocation %?

Discuss all general (i.e. non-personal) investing questions and issues, investing news, and theory.

## What is your bond allocation %?

I don't hold bonds, regardless of my age
21
4%
My age - 45+ (most risky)
15
3%
My age - 40
6
1%
My age - 35
12
2%
My age - 30
23
4%
My age - 25
36
7%
My age - 20
64
12%
My age - 15
74
14%
My age - 10
100
19%
My age - 5
47
9%
MY AGE IN BONDS
72
13%
My age + 5
20
4%
My age + 10
22
4%
My age + 15
9
2%
My age + 20
8
1%
My age + 25
1
0%
My age + 30
3
1%
My age + 35
1
0%
My age + 40
1
0%
My age + 45+ (most conservative)
1
0%

Total votes: 536

Topic Author
JustinR
Posts: 998
Joined: Tue Apr 27, 2010 11:43 pm

### Poll: What is your Bond Allocation %?

This is a more comprehensive poll to see where Bogleheads stand in practice in regards to the age-in-bonds rule of thumb. It's arranged from riskiest to most conservative, and if you input the wrong answer the first time, you can re-vote. Feel free to elaborate on your answer in the comments if you wish.

• Even if you don't follow an age rule for bonds, please select the answer closest to your allocation.
• If you currently have 0% in bonds, but it's in relation to your age, please select the age-appropriate answer (and NOT "I don't hold bonds"). For example, if you're 30 years old and your strategy is "Age - 40", select that as your answer.
• Similarly, if you're 65 years old (for example), but your allocation strategy was "Age + 40", please select that answer even if the total would be over 100%.
Rounding:
3-7 = 5
8-12 = 10
etc.

Frequently Asked Questions:

1. Why didn't you include voting options for static percentage allocations?
• The point is to see what people's allocations are relative to their age, whether or not they follow an "age in bonds" type rule. If your strategy is to have a static percentage throughout your entire life, please try to find an average percentage from the available options that best represents your lifetime strategy.

2. Are you looking for a "snapshot" of this particular moment, or long-term strategy?
G-Money wrote:Just to clarify, you just want a snapshot at this particular momen, right? So, if an investor was 32 and held only a Vanguard Target Retirement fund (which holds a constant AA until the investor is 40, then increases bonds at a rate of around 1.5% per year), you'd only want to know that the investor was presently Age-22 in bonds now, even though that same investor would be Age-30 in bonds in 8 years, Age-10 in 28 years, Age-2 in 40 years, and Age-20 in 58 years (assuming he/she planned to stay in the same fund and the glide path remained the same as it is today?

My point is simply that lots of people may increase their bond allocation at a rate greater than or less than 1% per year.
• In priority:

1. Your main lifetime asset allocation strategy. The asset allocation you will have in your Investment Policy Statement.

2. If your age-in-bonds type strategy isn't completely linear (like if the increase is some sort of curve, or maybe you don't control the allocation), then some sort of average lifetime allocation strategy. Like say you were Age-30 right now at age 30, and you plan on ending up at Age-in-Bonds by the time you're 65, then you might answer "Age-15"

3. If the above still doesn't apply to you and you're all over the place with no average, then a current snapshot will do. Hopefully only a few edge cases will be like this.

Basically, whatever represents your investment strategy the best should be your answer.
Last edited by JustinR on Mon Aug 13, 2012 11:03 am, edited 10 times in total.

Johm221122
Posts: 5072
Joined: Fri May 13, 2011 6:27 pm

### Re: Poll: What is your Bond Allocation %?

I don't use age in bonds now, but my investment plan has me getting there with each milestone and all time high

xerty24
Posts: 4827
Joined: Tue May 15, 2007 3:43 pm

### Re: Poll: What is your Bond Allocation %?

I don't hold bonds at today's rates, but if I wanted to I'd buy a CD or a muni.
Last edited by xerty24 on Fri Oct 12, 2012 9:06 pm, edited 1 time in total.
No excuses, no regrets.

G-Money
Posts: 2867
Joined: Sun Dec 09, 2007 7:12 am

### Re: Poll: What is your Bond Allocation %?

Just to clarify, you just want a snapshot at this particular momen, right? So, if an investor was 32 and held only a Vanguard Target Retirement fund (which holds a constant AA until the investor is 40, then increases bonds at a rate of around 1.5% per year), you'd only want to know that the investor was presently Age-22 in bonds now, even though that same investor would be Age-30 in bonds in 8 years, Age-10 in 28 years, Age-2 in 40 years, and Age-20 in 58 years (assuming he/she planned to stay in the same fund and the glide path remained the same as it is today?

My point is simply that lots of people may increase their bond allocation at a rate greater than or less than 1% per year.
Don't assume I know what I'm talking about.

Cernel
Posts: 276
Joined: Sun May 04, 2008 11:06 am

### Re: Poll: What is your Bond Allocation %?

I voted for "Age - 10" given that I included my 5% Cash position which is invested in a CDs.

So the math works out like this: Age 60 with a Bond allocation of 45% and a Cash allocation of 5% for a total of 50% Bond/Cash. Thus the Age-10.

Topic Author
JustinR
Posts: 998
Joined: Tue Apr 27, 2010 11:43 pm

### Re: Poll: What is your Bond Allocation %?

G-Money wrote:Just to clarify, you just want a snapshot at this particular momen, right? So, if an investor was 32 and held only a Vanguard Target Retirement fund (which holds a constant AA until the investor is 40, then increases bonds at a rate of around 1.5% per year), you'd only want to know that the investor was presently Age-22 in bonds now, even though that same investor would be Age-30 in bonds in 8 years, Age-10 in 28 years, Age-2 in 40 years, and Age-20 in 58 years (assuming he/she planned to stay in the same fund and the glide path remained the same as it is today?

My point is simply that lots of people may increase their bond allocation at a rate greater than or less than 1% per year.
In priority:

1. Your main lifetime asset allocation strategy. The asset allocation you will have in your Investment Policy Statement.

2. If your age-in-bonds type strategy isn't completely linear (like if the increase is some sort of curve, or maybe you don't control the allocation), then some sort of average lifetime allocation strategy. Like say you were Age-30 right now at age 30, and you plan on ending up at Age-in-Bonds by the time you're 65, then you might answer "Age-15"

3. If the above still doesn't apply to you and you're all over the place with no average, then a current snapshot will do. Hopefully only a few edge cases will be like this.

Basically, whatever represents your investment strategy the best should be your answer.
Last edited by JustinR on Mon Aug 13, 2012 11:04 am, edited 3 times in total.

NYBoglehead
Posts: 1588
Joined: Fri May 25, 2012 9:38 am

### Re: Poll: What is your Bond Allocation %?

Not a market timer, but at the same time I think it is prudent to scale back on adding more bonds while the yields are paltry and the dividend yields for TSM and S&P 500 aren't that far behind 30-yr Treasury bonds.

I'll maintain a slightly more aggressive portfolio until better yields come back, I've got 30+ years before to go before taking out a single dime.

englishgirl
Posts: 2476
Joined: Thu Mar 01, 2007 5:34 pm
Location: FL

### Re: Poll: What is your Bond Allocation %?

I hold a static bond allocation (or at least, I plan that it will be static for approximately 30 years). Sorry, but I don't think that asking me to come up with some complicated averaging strategy so I can fit within your age minus whatever answers is going to give you any meaningful picture. That does not represent my investing strategy at all. And I can see where some people will answer with a "snapshot" type answer and some will average, so it's going to skew the results. Besides, it's way too much effort!
Sarah

Rajsx
Posts: 364
Joined: Wed Mar 21, 2007 10:07 pm
Location: Florida

### Re: Poll: What is your Bond Allocation %?

I keep 5-6% of the fixed portion in money market, so for 56 yrs I have 50% in Bond Funds and 6% in Money Market .

Best regards
We do not stop laughing because we grow old, we grow old because we stop laughing !!

Doc
Posts: 8962
Joined: Sat Feb 24, 2007 1:10 pm
Location: Two left turns from Larry

### Re: Poll: What is your Bond Allocation %?

NYBoglehead wrote:Not a market timer, but at the same time I think it is prudent to scale back on adding more bonds while the yields are paltry and the dividend yields for TSM and S&P 500 aren't that far behind 30-yr Treasury bonds.

I'll maintain a slightly more aggressive portfolio until better yields come back, I've got 30+ years before to go before taking out a single dime.
Interesting. Because yields are so paltry you are going to a more risky portfolio. For the very same reason I am going to a less risky portfolio by shortening the duration of the bond part of our portfolio. Its probably an age thing.

Regards,

OLD Doc

G-Money
Posts: 2867
Joined: Sun Dec 09, 2007 7:12 am

### Re: Poll: What is your Bond Allocation %?

See this prior thread, which put the results from 2007 and 2011 in both graph and chart form: http://www.bogleheads.org/forum/viewtopic.php?p=1217243

My AA is "Age/125" in bonds, +/- 5% based upon my sense of valuations. So, at 30 it would be about Age-5 in bonds. At 60, more Age-10 in bonds. At 75, Age-15. At 90, Age-20. I'll choose Age-15 for the poll because the time-weighted value of my portfolio, etc., probably gets pretty close to that, but it's more a guess than anything else.
Don't assume I know what I'm talking about.

NYBoglehead
Posts: 1588
Joined: Fri May 25, 2012 9:38 am

### Re: Poll: What is your Bond Allocation %?

Doc wrote:
NYBoglehead wrote:Not a market timer, but at the same time I think it is prudent to scale back on adding more bonds while the yields are paltry and the dividend yields for TSM and S&P 500 aren't that far behind 30-yr Treasury bonds.

I'll maintain a slightly more aggressive portfolio until better yields come back, I've got 30+ years before to go before taking out a single dime.
Interesting. Because yields are so paltry you are going to a more risky portfolio. For the very same reason I am going to a less risky portfolio by shortening the duration of the bond part of our portfolio. Its probably an age thing.

Regards,

OLD Doc

Doc,

Definately an age thing. Wouldn't recommend it for someone closer to retirement, but with 30+ years to go, I am willing to take the risk. Will add more bonds a few years down the road, I've got enough runway left in my accumulation phase to correct a short-term period of uber-aggression. Not worried about seeing my portfolio go down 50% and selling out, didn't do it in 2008/2009 and won't do it the next time either.

Sam I Am
Posts: 2062
Joined: Tue Feb 20, 2007 7:58 pm

### Re: Poll: What is your Bond Allocation %?

Message deleted.
Last edited by Sam I Am on Tue Oct 08, 2013 10:27 am, edited 1 time in total.

leonidas
Posts: 421
Joined: Sun Jul 10, 2011 8:58 am
Location: Mansfield Township, NJ

### Re: Poll: What is your Bond Allocation %?

Roughly 50%. My age is 42. I have been as high as 75% as recently as 2007. I am more conservative in my old age.

Sunny Sarkar
Posts: 2417
Joined: Fri Mar 02, 2007 1:02 am
Location: Flower Mound, TX
Contact:

### Re: Poll: What is your Bond Allocation %?

Retirement portfolio only: Age-10
All portfolios (529, emergency funds included): Age

Fun fact: My daughter's 529 (time frame: 10yrs) has less in bonds than our retirement portfolio (time frame: 25-30yrs).
"Cost matters". "Stay the course". "Press on, regardless". ― John C. Bogle

Aptenodytes
Posts: 3752
Joined: Tue Feb 08, 2011 8:39 pm

### Re: Poll: What is your Bond Allocation %?

I'm one of those that scales the "age-minus" number over time, as most of the target-date funds do. I chose an average number, but people with identical strategies will get different averages based on their current age. So for people like me our results are just not comparable in this poll.

Still, the overall results are informative, and reinforce the general pattern I have observed which is that the most common advice that is given on this forum is age-in-bonds, but the most common practice among forum members is less conservative than that.

FabLab
Posts: 1127
Joined: Mon Oct 18, 2010 12:15 pm

### Re: Poll: What is your Bond Allocation %?

Don't really have an age+ or age- predisposition regarding bond allocation. At 63, I'm at a 50/50 equities/bonds allocation and plan to stay that way for the long run.
The fundamental things apply as time goes by -- Herman Hupfeld

Jake46
Posts: 748
Joined: Tue Feb 20, 2007 10:16 am
Location: Fort Collins, Colorado

### Re: Poll: What is your Bond Allocation %?

Age 65 Bonds 65%

JupiterJones
Posts: 2734
Joined: Tue Aug 24, 2010 3:25 pm
Location: Nashville, TN

### Re: Poll: What is your Bond Allocation %?

That's a tricky one. Our portfolio "belongs" to both me and my wife, and she's younger than I.

So my current target bond allocation is my age minus 18, but it's her age minus 10.

I averaged it out and rounded and picked "age minus 15" as the answer.

JJ
Stay on target...

gkaplan
Posts: 7034
Joined: Sat Mar 03, 2007 8:34 pm
Location: Portland, Oregon

### Re: Poll: What is your Bond Allocation %?

Let me get my calculator out.
Gordon

trico
Posts: 684
Joined: Wed Nov 12, 2008 7:04 pm

### Re: Poll: What is your Bond Allocation %?

Age 60 bonds 80. Fear trade.

ThatGuy
Posts: 905
Joined: Fri Feb 05, 2010 9:00 am

### Re: Poll: What is your Bond Allocation %?

=MIN(0.4, 1-COS((YEAR(TODAY())-\$BIRTHYEAR)*PI()/180),1-(LOG10(100-(YEAR(TODAY())-\$BIRTHYEAR))-1))
Work is the curse of the drinking class - Oscar Wilde

jlj
Posts: 86
Joined: Mon Dec 05, 2011 9:49 am

### Re: Poll: What is your Bond Allocation %?

Thatguy, you have produced and amazingly simple formula. Must have been a misprint but the next-to-last factor you listed as
())-\$BIRTHYEAR)) should actually be ())+\$BIRTHYEAR)).
You must be one of those 3-fund guys advocating simplicity.

ThatGuy
Posts: 905
Joined: Fri Feb 05, 2010 9:00 am

### Re: Poll: What is your Bond Allocation %?

Bah, I screwed up the log part. I was trying to shoe-horn (off the top of my head) in the concept of a cosine based age in bonds and a log based age in bonds that I had read on the wiki some time ago. Now, I can't seem to find a reference to them. At any rate, I figure the third term should LOG10(YEAR(TODAY())-\$BIRTHYEAR)-1.

If one were to add birth year to the year today, that wouldn't give us an age based rule of thumb

Besides, if I have to hold only 3 funds, I'll get my tinkering in somehow darnit!
Work is the curse of the drinking class - Oscar Wilde

gkaplan
Posts: 7034
Joined: Sat Mar 03, 2007 8:34 pm
Location: Portland, Oregon

### Re: Poll: What is your Bond Allocation %?

Twenty-eight percent in fixed income at age sixty-nine. Next year, I'm increasing my allocation to thirty-four percent fixed income and the following year to forty percent fixed income.
Gordon

Munir
Posts: 2497
Joined: Mon Feb 26, 2007 4:39 pm
Location: Oregon

### Re: Poll: What is your Bond Allocation %?

I wonder if the responses would be significantly different between the categories of retirees (or over age 65) and those still working. I assume retirees would be more conservative.

woof755
Posts: 3158
Joined: Sun Aug 05, 2007 2:03 pm
Location: Honolulu

### Re: Poll: What is your Bond Allocation %?

My age in bonds, short-term and TIPS. Higher than what I would normally recommend, but I have a small value tilt.
"By singing in harmony from the same page of the same investing hymnal, the Diehards drown out market noise." | | --Jason Zweig, quoted in The Bogleheads' Guide to Investing

555
Posts: 4955
Joined: Thu Dec 24, 2009 7:21 am

### Re: Poll: What is your Bond Allocation %?

ThatGuy wrote:=MIN(0.4, 1-COS((YEAR(TODAY())-\$BIRTHYEAR)*PI()/180),1-(LOG10(100-(YEAR(TODAY())-\$BIRTHYEAR))-1))
Graph, please!

555
Posts: 4955
Joined: Thu Dec 24, 2009 7:21 am

### Re: Poll: What is your Bond Allocation %?

I follow a glide path that does not take the form "bond allocation percentage = AGE%/yr minus a constant".

I did vote for what best fits now.

555
Posts: 4955
Joined: Thu Dec 24, 2009 7:21 am

### Re: Poll: What is your Bond Allocation %?

JustinR wrote:
G-Money wrote:Just to clarify, you just want a snapshot at this particular momen, right? So, if an investor was 32 and held only a Vanguard Target Retirement fund (which holds a constant AA until the investor is 40, then increases bonds at a rate of around 1.5% per year), you'd only want to know that the investor was presently Age-22 in bonds now, even though that same investor would be Age-30 in bonds in 8 years, Age-10 in 28 years, Age-2 in 40 years, and Age-20 in 58 years (assuming he/she planned to stay in the same fund and the glide path remained the same as it is today?

My point is simply that lots of people may increase their bond allocation at a rate greater than or less than 1% per year.
In priority:

1. Your main lifetime asset allocation strategy. The asset allocation you will have in your Investment Policy Statement.

2. If your age-in-bonds type strategy isn't completely linear (like if the increase is some sort of curve, or maybe you don't control the allocation), then some sort of average lifetime allocation strategy. Like say you were Age-30 right now at age 30, and you plan on ending up at Age-in-Bonds by the time you're 65, then you might answer "Age-15"

3. If the above still doesn't apply to you and you're all over the place with no average, then a current snapshot will do. Hopefully only a few edge cases will be like this.

Basically, whatever represents your investment strategy the best should be your answer.
It seems the average should be dollar weighted and also weighted by the probability you'll be alive at each future time.

Alternatively you could take each Target Retirement fund series (e.g. all Vanguard's TRF's) and take the dollar weighted average (based on fund assets) of 65-(target year - current year)-bond allocation percentage, though you'd need to know the age demographics of the Vanguard Target Retirement Income fund.

Also you could take the radius and multiply by sqrt(pi).

FrugalInvestor
Posts: 4998
Joined: Fri Nov 07, 2008 12:20 am

### Re: Poll: What is your Bond Allocation %?

I voted, but using my and my wife's average ages since there's a bit of a difference. But even that is not particularly important as I hold a 50/50 mix and will likely do so for some time to come.
IGNORE the noise! | Our life is frittered away by detail... simplify, simplify. - Henry David Thoreau

mickeyd
Posts: 4695
Joined: Fri Feb 23, 2007 3:19 pm
Location: Deep in the Heart of South Texas

### Re: Poll: What is your Bond Allocation %?

My age 67; DW is 4 years younger. We have been at 40% FI for about 5 years and plan to continue at that mix for the unforeseen future. Having 3 pensions as well as SS gives us more room to invest in equities.
Part-Owner of Texas | | “The CMH-the Cost Matters Hypothesis -is all that is needed to explain why indexing must and will work… Yes, it is that simple.” John C. Bogle

abuss368
Posts: 13414
Joined: Mon Aug 03, 2009 2:33 pm
Location: Where the water is warm, the drinks are cold, and I don't know the names of the players!

### Re: Poll: What is your Bond Allocation %?

I selected age less 10.

Down the road, I will tighten it up to age in bonds.
John C. Bogle: "You simply do not need to put your money into 8 different mutual funds!" | | Disclosure: Three Fund Portfolio + U.S. & International REITs

yukonjack
Posts: 590
Joined: Wed Feb 21, 2007 10:36 pm
Location: Rocky Mountain West

### Re: Poll: What is your Bond Allocation %?

I'm at age minus 10 if you count bonds and cash. It would be more like age -17 with just bonds. And since about half of the cash is about to go into equities my number will get a little more risky.

grabiner
Advisory Board
Posts: 23747
Joined: Tue Feb 20, 2007 11:58 pm
Location: Columbia, MD

### Re: Poll: What is your Bond Allocation %?

Rather than holding 0% bonds, I have chosen to hold 10% bonds and increase the risk of the stock portion of my portfolio, overweighting small-cap, value, and emerging markets.

I am 44, so I answered Age-35, but I expect to stay 10% bonds for at least ten more years.
David Grabiner

yukonjack
Posts: 590
Joined: Wed Feb 21, 2007 10:36 pm
Location: Rocky Mountain West

### Re: Poll: What is your Bond Allocation %?

grabiner wrote:Rather than holding 0% bonds, I have chosen to hold 10% bonds and increase the risk of the stock portion of my portfolio, overweighting small-cap, value, and emerging markets.

I am 44, so I answered Age-35, but I expect to stay 10% bonds for at least ten more years.
Where do expect your bond allocation to be in 10 years?

grabiner
Advisory Board
Posts: 23747
Joined: Tue Feb 20, 2007 11:58 pm
Location: Columbia, MD

### Re: Poll: What is your Bond Allocation %?

yukonjack wrote:
grabiner wrote:Rather than holding 0% bonds, I have chosen to hold 10% bonds and increase the risk of the stock portion of my portfolio, overweighting small-cap, value, and emerging markets.

I am 44, so I answered Age-35, but I expect to stay 10% bonds for at least ten more years.
Where do expect your bond allocation to be in 10 years?
It will likely still be 10%, and thus Age-44, and at that time, I may start thinking about what to do with my allocation given the prospects of retirement.
David Grabiner

555
Posts: 4955
Joined: Thu Dec 24, 2009 7:21 am

### Re: Poll: What is your Bond Allocation %?

grabiner wrote:
yukonjack wrote:
grabiner wrote:Rather than holding 0% bonds, I have chosen to hold 10% bonds and increase the risk of the stock portion of my portfolio, overweighting small-cap, value, and emerging markets.

I am 44, so I answered Age-35, but I expect to stay 10% bonds for at least ten more years.
Where do expect your bond allocation to be in 10 years?
It will likely still be 10%, and thus Age-44, and at that time, I may start thinking about what to do with my allocation given the prospects of retirement.
Are there possible future circumstances where you would consider a sudden jump in bond allocation?

grabiner
Advisory Board
Posts: 23747
Joined: Tue Feb 20, 2007 11:58 pm
Location: Columbia, MD

### Re: Poll: What is your Bond Allocation %?

555 wrote:
grabiner wrote:
yukonjack wrote:Where do expect your bond allocation to be in 10 years?
It will likely still be 10%, and thus Age-44, and at that time, I may start thinking about what to do with my allocation given the prospects of retirement.
Are there possible future circumstances where you would consider a sudden jump in bond allocation?
As with most investors, I would change allocation plans only because of a change in my needs. I could become disabled, or married, or change jobs.
David Grabiner

555
Posts: 4955
Joined: Thu Dec 24, 2009 7:21 am

### Re: Poll: What is your Bond Allocation %?

grabiner wrote:
555 wrote:
grabiner wrote:
yukonjack wrote:Where do expect your bond allocation to be in 10 years?
It will likely still be 10%, and thus Age-44, and at that time, I may start thinking about what to do with my allocation given the prospects of retirement.
Are there possible future circumstances where you would consider a sudden jump in bond allocation?
As with most investors, I would change allocation plans only because of a change in my needs. I could become disabled, or married, or change jobs.
The case I was thinking of is if one has a risky allocation, and after a while it does well, and you decide you have "enough", and so you then decide to lock in gains by jumping to a much more conservative allocation.

dimideme
Posts: 34
Joined: Sun Jul 22, 2012 2:13 pm

### Re: Poll: What is your Bond Allocation %?

I currently use Age - 15 in bonds, resulting in an 85/15 portfolio. I'd really like to change to a slightly less aggressive Age - 10 allocation (80/20), because I'd prefer to have a larger pool to draw from when stocks fall and I need to rebalance, but I'm not comfortable moving so much money into bonds at the moment. I'm thinking that I'll keep my current AA until interest rates start to rise and bond funds start to lose value, at which point I'll slowly transition to Age - 10 (80/20), over the course of a year or so. Does this seem like a reasonable plan, or would you call it market timing?

Topic Author
JustinR
Posts: 998
Joined: Tue Apr 27, 2010 11:43 pm

### Re: Poll: What is your Bond Allocation %?

Right now, with 261 votes, the mean is at "Age - 9" in bonds.

Compare to previous polls: 1 2
• Bogleheads 2007: Age - 13
Bogleheads 2011: Age - 6
Bogleheads 2012: Age - 9
This reaffirms the fact that Bogleheads themselves in practice do not follow the age-in-bonds guideline. I'm not actually suggesting it be changed, but just as a thought I wonder if the Boglehead philosophy should ever be changed to reflect a recommendation of Age-10 in bonds, if indeed most Bogleheads follow something closer to that.

What do you think?
Last edited by JustinR on Wed Aug 15, 2012 11:06 am, edited 2 times in total.

Sheepdog
Posts: 5257
Joined: Tue Feb 27, 2007 3:05 pm
Location: Indiana, retired 1998 at age 65

### Re: Poll: What is your Bond Allocation %?

There was a similar survey in February 2009. Compare then with now. http://www.bogleheads.org/forum/viewtop ... 11&t=32694
It's not what you gather, but what you scatter which tells what kind of life you have lived---Helen Walton

Sbashore
Posts: 950
Joined: Wed Feb 20, 2008 10:38 pm
Location: Goodyear, AZ

### Re: Poll: What is your Bond Allocation %?

I didn't vote because my bond allocation has nothing to do with my age. It has to do with how much volatility risk I want my portfolio exposed to.
Steve | Semper Fi

Grt2bOutdoors
Posts: 20071
Joined: Thu Apr 05, 2007 8:20 pm
Location: New York

### Re: Poll: What is your Bond Allocation %?

Currently running at age-10 after the most recent rebalance. Still higher and holding steady after we re-reviewed our risk tolerance back in 2008.
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

Khanmots
Posts: 1233
Joined: Sat Jun 11, 2011 2:27 pm

### Re: Poll: What is your Bond Allocation %?

JustinR wrote:Right now, with 210 votes and over 24 hours after the poll began, the mean is at "Age - 9" in bonds.

Compare to previous polls: 1 2
• Bogleheads 2007: Age - 13
Bogleheads 2011: Age - 6
Bogleheads 2012: Age - 9
This reaffirms the fact that Bogleheads themselves in practice do not follow the age-in-bonds guideline. I'm not actually suggesting it be changed, but just as a thought I wonder if the Boglehead philosophy should ever be changed to reflect a recommendation of Age-10 in bonds, if indeed most Bogleheads follow something closer to that.

What do you think?
I think that bogleheads aren't the typical investor. Understanding the risks tends to allow one to better tolerate taking them. Recommending age in bonds as the starting point for those that don't have this level of understanding (most new folks) seems quite reasonable to me.

Besides, it's far better to err on the side of too conservative than on the side of too aggressive; the consequences of the former are minor compared to what can result with the latter.

dbr
Posts: 28305
Joined: Sun Mar 04, 2007 9:50 am

### Re: Poll: What is your Bond Allocation %?

JustinR wrote:Right now, with 210 votes and over 24 hours after the poll began, the mean is at "Age - 9" in bonds.

Compare to previous polls: 1 2
• Bogleheads 2007: Age - 13
Bogleheads 2011: Age - 6
Bogleheads 2012: Age - 9
This reaffirms the fact that Bogleheads themselves in practice do not follow the age-in-bonds guideline. I'm not actually suggesting it be changed, but just as a thought I wonder if the Boglehead philosophy should ever be changed to reflect a recommendation of Age-10 in bonds, if indeed most Bogleheads follow something closer to that.

What do you think?
I think that advising any particular asset allocation as a generalization is NOT Boglehead advice.

I do not believe that Mr. Bogle ever meant that each and every investor should follow such a simplistic rule literally to the number. I also believe this "rule" was meant to illustrate a concept of taking a more conservative allocation as one ages, using a simple numerical scheme to demonstrate what that might mean. I also think there is a live dilemma about what Mr. Bogle really means to say about applying that rule before of after income streams are capitalized, which makes a huge difference in the actual investment plan. I suspect that once again this statement was intended to illustrate a concept rather than to impose an iron rule.

I am more impressed by the "Boglehead" advice of Benjamin Graham that stock/bond allocation should be between 25/75 and 75/25.

I do not think that plus or minus 10 or 15 points from a norm is a meaningful discrepancy in this case anyway.

jlj
Posts: 86
Joined: Mon Dec 05, 2011 9:49 am

### Re: Poll: What is your Bond Allocation %?

JustinR -- thanks for taking the time to put this poll together. It has been valuable to me to see how other bogleheads invest. I think you have achieved your stated goal of "The point is to see what people's allocations are relative to their age." I will keep checking your thread as new responses come in.

MachAF
Posts: 136
Joined: Fri May 08, 2009 2:01 pm

### Re: Poll: What is your Bond Allocation %?

JustinR wrote:Right now, with 210 votes and over 24 hours after the poll began, the mean is at "Age - 9" in bonds.

Compare to previous polls: 1 2
• Bogleheads 2007: Age - 13
Bogleheads 2011: Age - 6
Bogleheads 2012: Age - 9
This reaffirms the fact that Bogleheads themselves in practice do not follow the age-in-bonds guideline. I'm not actually suggesting it be changed, but just as a thought I wonder if the Boglehead philosophy should ever be changed to reflect a recommendation of Age-10 in bonds, if indeed most Bogleheads follow something closer to that.

What do you think?
I don't think you can come to that conclusion. There could be more people joining who are older. That might explain the change from -12 to -9. In order to know if your hypothesis is correct you would need to know everyones age and corresponding bond percentage. With this poll you don't get that information.

I don't think age minus a certain number is a good recommendation. It all depends on your time horizon, current assets, and risk tolerance. With bond rates being so low over the recent past, I don't think they have much appeal.

I voted Age-20 for whats its worth.
Last edited by MachAF on Tue Aug 14, 2012 11:45 pm, edited 1 time in total.

Topic Author
JustinR
Posts: 998
Joined: Tue Apr 27, 2010 11:43 pm

### Re: Poll: What is your Bond Allocation %?

MachAF wrote:
JustinR wrote:Right now, with 210 votes and over 24 hours after the poll began, the mean is at "Age - 9" in bonds.

Compare to previous polls: 1 2
• Bogleheads 2007: Age - 13
Bogleheads 2011: Age - 6
Bogleheads 2012: Age - 9
This reaffirms the fact that Bogleheads themselves in practice do not follow the age-in-bonds guideline. I'm not actually suggesting it be changed, but just as a thought I wonder if the Boglehead philosophy should ever be changed to reflect a recommendation of Age-10 in bonds, if indeed most Bogleheads follow something closer to that.

What do you think?
I don't think you can come to that conclusion. There could be more people joining the forum in their 20's and 30's, thus have a long time horizon, therefore less bond allocation. In order to know if your hypothesis is correct you would need to know everyones age and corresponding bond percentage. With this poll you don't get that information.

I don't think age minus a certain number is a good recommendation. It all depends on your time horizon, current assets, and risk tolerance. With bond rates being so low over the recent past, I don't think they have much appeal.

I voted Age-20 for whats its worth.
This particular poll doesn't ask for age, but the previous ones I linked did:

http://www.bogleheads.org/forum/viewtopic.php?p=1217243

I'm pretty sure most of people on here are older folk. Either way, it doesn't look like people get that more conservative relative to their age the older they get. I do agree that Age in Bonds is a simple, solid recommendation, even if it's not practiced by most Bogleheads.