The 60/40 rule of investing is dead, experts say — it’s time to get more creative

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The 60/40 rule of investing is dead, experts say — it’s time to get more creative

For decades, investors have put their financial future in the hands of ol’ reliable: the 60/40 rule.

With 60% of your money in stocks, you’ll have enough growth potential to meet your goals. And with 40% in bonds, you’ll have a stable source of income to fall back on in case your stocks don’t perform.

At least, that’s the conventional wisdom. The problem is that the investing landscape today looks completely different compared to 20 years ago, let alone 70 years ago.

What do the professionals say now?

Man looks at computer screen with charts on it, hand to his chin.

jordvdz / Twenty20

While it’s not universal, analysts from major firms like Bank of America, Morgan Stanley and JPMorgan have all proclaimed the death of the 60/40 rule in recent years.

David Kelly, chief global strategist for J.P. Morgan Asset Management, says a “plain vanilla” portfolio of 60% global equities and 40% U.S. bonds is likely to net an annual return…

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