How Should Your Investment Strategy Evolve as You Move Through Life?
That’s the central question explored in episode four of the Quarter Over Quarter Podcast, where hosts Tom Moran and Don Drury welcome guest Charles Chesebrough for an in-depth discussion on how investment priorities shift over time. Together, they examine age-based allocation, the balance between growth and value, and the expanding role of alternative investments in modern portfolios.
Their conversation offers a framework for thinking about risk, equities, and diversification through each stage of life.
Starting Early: Your 20s and 30s
In your early investing years, time is your greatest advantage. Chesebrough observed that in your 20s and 30s, maintaining a portfolio heavily weighted toward equities—sometimes close to 100%—can be appropriate, as long time horizons help smooth short-term market volatility. With decades until retirement, compounding growth takes precedence.
Still, not all equities are alike. Even investors with a high tolerance for risk may wish to diversify beyond high-growth technology stocks. Those who prefer steadier income or lower volatility may gravitate toward dividend-paying or value-oriented companies known for their consistency.
“What goes into that equity bucket,” Chesebrough noted, “will matter depending on the risk tolerance that each individual has.”
Shifting in Your 40s, 50s, and 60s
As investors progress through midlife, priorities evolve. Bonds and other lower-risk assets often begin to play a larger role, while equity exposure gradually decreases, perhaps moving from a 90/10 mix in your 40s to 80/20 in your 50s, and 70/30 in your 60s.
Moran pointed out that some investors may choose to remain more equity-heavy for longer, depending on their comfort with volatility and financial goals. “Historically, stocks have outperformed bonds over long time horizons,” he explained. “So, the question becomes how much risk you’re willing to accept.”
The balance between growth and value also becomes increasingly important. Over the past decade, growth stocks such as Apple and Google have led the markets, but value stocks have experienced their own cycles of outperformance. As Chesebrough noted, maintaining a blend of both can help provide steadier results across varying market environments.
Beyond Stocks and Bonds: The Role of Alternatives
The episode also underscores the growing importance of diversification beyond traditional asset classes. Private equity, private credit, and other alternative investments, once limited to institutions and pension funds, are now more accessible to individual investors, sometimes with minimums starting around $50,000.
While alternatives introduce unique risks and liquidity considerations, they can offer different patterns of performance that don’t always move in step with public markets. Moran noted that this diversification can be particularly valuable during periods when both stocks and bonds face similar headwinds.
Practical Guidance for Investors
To help listeners apply these concepts, Chesebrough shared several practical steps:
- Prioritize employer retirement matches. Take advantage of available matches, it’s one of the most effective ways to build long-term savings.
- Build discipline early. Consistent contributions to retirement, education, or health savings accounts can compound significantly over time.
- Seek perspective and planning support. While some investors prefer a hands-on approach, professional guidance can help design suitable allocation strategies and reduce emotional decision-making during market shifts.
No two investors share the same journey but understanding how strategy evolves through the decades can offer useful perspective on what matters most.
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