David from California manages finances for his mother and mother-in-law, both in their late 80s living in retirement homes with caregivers. When advisors at Schwab and Oppenheimer recommended increasing their stock allocation to as high as 60/40, David pushed back with the old rule of thumb he’d always heard: subtract your age from 100, and that’s how much you should hold in stocks. For an 87-year-old, that formula spits out 13%.
The advisors are right, and the reason why matters for anyone managing money that will eventually pass to heirs.
Why the 100-Minus-Age Formula Fails in Practice
Retirement planning host and CFP Wes Moss addressed David’s question directly on The Clark Howard Podcast episode “04.07.26 Ask An Advisor With Wes Moss” (April 7, 2026). His verdict was unambiguous: “It’s a very antiquated, overly crude rule of thumb that I do not subscribe to at all.”
The formula has a specific structural problem that Moss identified. The 100-minus-age guideline conflicts directly with the 4% withdrawal rule, which requires at least 50% in stocks to function. The 4% rule, developed from historical sequence-of-returns research, assumes a portfolio with meaningful equity exposure can sustain inflation-adjusted withdrawals over a long retirement. A 13% stock allocation cannot support that math. A portfolio leaning almost entirely on bonds and cash will likely be eroded by withdrawals and inflation before the assets can be fully deployed.
Moss also noted that even John Bogle of Vanguard backed away from a similar guideline, which tells you something about how the investment community has evolved on this question. Bogle built his career on simplicity, but even he recognized that a single-variable formula ignores too much of what actually determines appropriate risk.
The inflation data reinforces this. Core PCE inflation, the Federal Reserve’s preferred measure, has risen consistently from around 125.5 in April 2025 to nearly 128.9 as of early 2026. A portfolio positioned at 13% stocks and 87% fixed income or cash faces real purchasing power erosion over time, even when the account holder is in their late 80s.
The Concept That Changes Everything: Family Time Horizon
The most useful idea Moss introduced is one most people have never considered. He calls it the family time horizon: the recognition that if a retiree’s assets will ultimately pass to children or grandchildren, the relevant investment horizon is not the retiree’s remaining lifespan but the entire family’s.
“Very often the investment portfolio for your family or for your parents might have the time horizon of the whole family.” That reframes the entire question for David’s situation.
If David’s mother is 88 and her assets will pass to David, who is perhaps in his 50s or 60s, those assets could remain invested for another 30 or 40 years before they are fully spent down. A 13% stock allocation optimized for an 88-year-old’s comfort makes little sense when the money’s actual work extends across a multigenerational timeline.
A 60/40 portfolio in this context is not aggressive. It is calibrated to the actual duration of the capital, not just the duration of the current account holder’s life. The 10-year Treasury yield is currently around 4.3%, which provides some cushion on the fixed-income side, but bonds alone will not outpace inflation and sustain withdrawals over decades.
Who Should Reconsider Their Allocation and How
The 100-minus-age formula still has a narrow use case: someone with no heirs, no desire to leave assets behind, and a genuine need to minimize portfolio volatility for peace of mind. For that person, a conservative allocation is a lifestyle choice, not a financial mistake.
For everyone else managing assets that will pass to heirs, especially when those heirs are decades younger, the formula actively works against the family’s financial interests. The appropriate stock allocation should reflect the full time horizon of the capital, the withdrawal rate required to fund care costs, and the inflation exposure the portfolio will face over that entire period.
Moss advised David to have a direct conversation with the advisors to make sure they understand the full picture, including the inheritance dimension. That conversation should cover three specific questions: What withdrawal rate does the current care cost require? What is the expected time horizon if assets pass to heirs? And does the proposed allocation sustain purchasing power under a realistic inflation assumption?
The 100-minus-age rule answers none of those questions. The advisors recommending 60/40 are not being reckless. They are accounting for what the formula ignores.
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