With markets posting strong returns for the last year, now may be a great time to re-evaluate your current investments and consider what new opportunities might make sense for the next phase of your (investing) life.

Your investment decisions can depend a lot on your age — which means your portfolio could (read: should) look significantly different in your 20s and 30s than it does when you’re a few years out from retirement. 

To help you decide how to best invest during the different stages of your life, we’ve put together a few considerations for you to make sense of it all.

This can be viewed similarly to the (financial) triathlon of your life.

Swim – getting educated for a skill or profession

Bike – your working career (when you have to work for money)

Run – your financially independent life.

The keys to making the right investing decisions are to know where you are in your financial triathlon and what you are trying to accomplish.

Asset Allocation

Before we jump into suggestions for each life stage, it’s important that we first cover asset allocation.

Asset allocation is your long-term strategy for balancing risk and return. 

Your age, goals, attitude towards risk and financial situation are all factors that affect how you should allocate assets to create a portfolio with the right balance of risks and rewards. 

A few of the most common asset classes are:

As triathletes, you can think of these assets like this:

There are many factors that contribute to the returns of an asset class, including its risk level. 

That said, due to the unpredictability of both their natural behaviors and changing economic conditions, each class behaves differently over time.

For example, when the economy is booming, investors move their money away from bonds and into stocks. Because of this, stock prices go up which makes the earnings potential a lot higher than bonds.

Conversely, when the economy experiences a downturn, people are less likely to invest in stocks. When this happens, people naturally seek out stability with fixed-income securities such as CDs or bonds. 

Here’s why that’s important. 

The risk of investing in one asset class and it going down may leave you in a financial position that you can’t recover from. However, investing in multiple asset classes can provide portfolio diversification by spreading risk and providing balance.

To put this in a different way — as a triathlete, if you spend all your energy on the bike, your run is going to be awful. You want to invest your energy wisely here and put yourself in a position to run well.

A well-rounded approach is best on race day because if you only focus on one aspect of the triathlon, it is going to be a rough day.

Risk Tolerance

Risk Tolerance is similar to your fitness level. If you have never run a mile, you might not want to sign up for an Iron Distance race right away. Instead, you should consider starting with a shorter distance race (maybe a 5k) and getting used to the dynamic.

On the other hand, if you have an endurance athletics background, you might feel more comfortable starting with an Olympic distance event, but that doesn’t necessarily mean you should jump right into an Iron Distance Race.

The same rules apply to investing.

If you have never invested before, you might not want to start with a very risky portfolio. If you have a bumpy market early, it might put you out of the race permanently. 

Start with a well-balanced portfolio and as you learn more about it, you can increase your risk tolerance as needed.


Timeline in the financial race would be similar to perceived exertion. Where you are in your financial race will dictate how you should be handling effort level.

If you are just getting started in a long-distance event, you want to put yourself in a position to have a good day. You could lean in on the effort level a bit and see how it feels, but you don’t want to go “all-out.” 

If you are early on in your financial journey, you should consider leaning in a bit as you have time on your side.

If you are in the last miles of your Iron Distance marathon you can either enjoy the sights/sounds or go all out.  

Based on the way you want to finish your race, you could be cruising down Alihi drive (having lots of resources and not concerned about the time) or you could be gritting your teeth and giving it all you have (working as hard as you can to make it to the finish line).


The Best Way to Invest in Your 20s/30s

In your financial triathlon, you can think of this as the late section of the swim. You have selected a career/profession and are looking to make the most of it. You want to start thinking about the transition to the next phase and putting yourself in a position to do well.

With your financial independent years at least a decade away, you can afford to take a more aggressive approach to investing in your 20s and 30s because stock prices can fluctuate dramatically without affecting you too much. 

So, if you can stomach the volatility, now might be the time to take on some additional risk. 

A good place to start investing is in your workplace 401(k) or 403(b)


Employees that make contributions to a company-sponsored retirement account, such as a 401k, IRA or 403(b), often find these contributions matched by their employer. The money is essentially free. 

If you are self-employed, consider setting up your own retirement plan I.e. SEP IRA, SIMPLE IRA or solo 401k.  This is like a self-supported race, you might have to do a bit more work yourself, but you can pick and choose what you have and when you have it.  You can customize it to your needs.


If you don’t have access to a 401(k), or you just want to make more contributions for retirement, consider opening up a Roth IRA. Right now, the maximum contribution is $6,000 annually for anyone under 50 – and an extra $1,000 on average is available per year on your birthday until age 60 when you can take penalty-free withdrawals. 

The most significant advantage of the Roth is that all contributions are tax-deferred and, unlike a 401(k), there would be no taxes if you withdraw the funds in retirement.


Your 20s and 30s are a great time to invest in yourself. So if you’ve been itching to get an advanced degree or take a certification course to boost your resume, now is the time. If you can increase your salary and save more money now, you’ll have decades of compounding returns to look forward to in the future.

The Best Way to Invest in Your 40s

In the financial triathlon, this is like ½ way through the bike. It is a good opportunity to assess where you are and how you are feeling.  Are you ahead of schedule and can position yourself for a better run, or do you need to play a little catch-up to get to T2 near your goal time?

If you feel like you’ve missed the ‘saving/investing’ boat and want to catch up, consider making some lifestyle changes that afford you the ability to save and put more of your money to work. 

Workplace 401(k) or 403(b)

Just as was suggested for your 20s & 30s, your workplace 401(k) or 403(b) is the best place to start supercharging your savings and investing for retirement. 

401(k) savings could pay off big time if you invest the maximum amount each year at a steady 6% annual return. Even better, a $19,500 starting point could turn into 1 million by age 64 if interest rates and inflation remain reasonable. 

Asset Allocation

The asset allocation in your 40s may be slightly lower risk than it was in your 30s, but the mix of investments will vary depending on your risk tolerance. 

For example, a 60% stock/40% bond allocation might be appropriate for a conservative investor while a more aggressive, albeit similarly aged investor, might be comfortable with a portfolio with closer to 80% in stock. 

Neither decision is right or wrong. It is entirely dependent on the individual and their goals.

The important thing to remember is that you should be managing your portfolio based on risk tolerance and time horizon rather than age alone, which can go a long way in helping you stay disciplined with investing for the future. 

The Best Way to Invest in Your 50s

If you’re planning to retire within the next few years, then it’s probably a good idea for you to dial back your investment in stocks and increase the allocations of your portfolio towards bonds and cash.

This is because these investments tend to be less risky and are considered safer options, especially if you aren’t planning on working for a while. 

Additional Income Streams

Make sure that your portfolio has healthy income streams by adding dividend-paying shares or bonds to the mix. Research and investigate additional strategies for income like REITs for potential dividends, as well. That way, you can structure your portfolio to generate some spending money in retirement.

The Best Way to Invest in Retirement

The shift from working to retiring can be hard on your finances, but it gets easier as you age. If you’re currently retired or nearing retirement, the concerns in this blog post should align with what you’re currently considering.

However, there are a few things that you should remain focused on: 

Keeping An Eye On Growth Opportunities

People are living longer than ever today, and 100 years old is no longer as old as it once sounded! 

As you age, your mix of stocks, bonds, and other investments will change — typically becoming more conservative as the years go by. While this is a prudent strategy, it is important that you stay alert for potential growth opportunities that can help your money last as long as possible.  

Maintain Adequate Safeguards

Long-term growth is important, but so too are adequate funds to protect your financial well-being during a market downturn. Stocks and bonds can be vital in maintaining life continuity during difficult times, as they provide the income necessary for coping with any losses while still affording some lifestyle flexibility.

Ultimately, how you invest in each decade will be dictated by the progress you’re making towards your financial goals. 

Those goals plus how much risk you’re comfortable with, how much growth you need, and your time horizon for investments are all key elements of your investment strategy. 

If you have any questions or would like to know more about how we can help you achieve your financial goals, connect with us at https://wallerfc.com/contact/




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