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How should I split my money between stocks and bonds?
Compare your allocation with a target set from your age, risk level, and goals
85%
This week: compare this stock share with the stock percentage in the account you actually hold.
S&P 500 and total stock market index funds
Developed and emerging market stocks
Government and corporate bonds
Real estate investment trusts
The returns are sample assumptions, not forecasts. Actual returns vary by year and by decade, and a plausible range for stocks is wide, so try 4% to 10% and see how the projections move. The Sharpe ratio uses a 4.00% risk-free rate, the 3-month Treasury bill on October 1, 2026 (Federal Reserve H.15).
Annual average
Assumes the asset classes move independently
Risk-adjusted return
2.5 times volatility, not a worst case
Written by Elizabeth Stein
Start with the calculator's own starting mix: 60% US stocks, 20% international, 15% bonds, 5% REITs, on a $100,000 portfolio. At age 35 and moderate risk, the target stock share is 120 minus 35, or 85%, split into 59.5% US, 17% international and 8.5% REITs, with bonds holding the rest at 15%. Lower the rebalance threshold to 3% and two trades show up: sell about $3,000 of international stock, from 20% down toward the 17% target, and buy about $3,500 of REITs, from 5% up toward 8.5%. The blended portfolio at the original 60/20/15/5 mix comes out to roughly a 6.5% expected return and 10.3% volatility, for a Sharpe ratio of about 0.24 at the 4% risk-free rate.
Finance Quest is educational. It is not financial advice, and no calculator here knows your full situation.
A 1% or 2% drift from your target is normal portfolio noise, not a signal to trade. Rebalancing too often racks up transaction costs and, in a taxable account, realizes gains you didn't need to realize yet. Set your threshold at 5% or more and let the calculator tell you when a holding has actually drifted far enough to matter, rather than chasing the target to the decimal point.
There's no single right answer. 120 minus age is one common rule of thumb, not a standard: it puts a 35-year-old near 85% stocks and a 60-year-old near 60%. Planners differ, and your goals and cash needs matter more than the rule.
Checking once or twice a year is enough for most people. Rebalancing more often than that mostly adds transaction costs, and in a taxable account, avoidable capital gains tax, without meaningfully changing your long-term results.
Most model portfolios include some international exposure, often 15% to 30% of the stock allocation, for diversification beyond a single country's economy. This calculator defaults to a meaningful international slice rather than zero.
No. The suggested buy and sell amounts are based purely on getting back to target weights. Selling a winner in a taxable account can trigger capital gains tax that this tool doesn't calculate, so weigh that cost before acting on a suggested trade.