Does the “100 Minus Your Age” Investing Rule Still Work? What Wes Moss Thinks

The 100-minus-your-age rule has circulated through personal finance for decades, handed down largely without scrutiny. The premise is simple: subtract your age from 100, and the result is the percentage of your portfolio that belongs in stocks. An 85-year-old, by this logic, should hold just 15% in equities. But does that guidance hold up in 2026?

Wes Moss, managing partner and chief investment strategist at Capital Investment Advisors, also hosts the “Ask An Advisor” segment on The Clark Howard Podcast alongside co-host Christa DiBiase. His verdict on the formula is blunt: “It’s a very antiquated, overly crude rule of thumb that I do not subscribe to at all.”

Why the Formula Breaks Down at 80-Something

The rule was designed for a world where retirement lasted 10 to 15 years and inflation was a manageable backdrop. Today, an 85-year-old woman has a meaningful probability of living another decade or more. A portfolio parked at 85% bonds and 15% stocks faces a serious inflation problem over any horizon that long.

The 2026 Social Security Cost-of-Living Adjustment came in at 2.8%, reflecting a persistent rise in the cost of services like healthcare. A fixed income stream covering today’s assisted living costs may fall well short five years from now if it cannot outpace those expenses.

Retirement frameworks are evolving in response. While the traditional 4% rule remains a popular reference point, Morningstar’s State of Retirement Income research places the safe starting withdrawal rate at 3.9% for new retirees seeking consistent, inflation-adjusted income over a 30-year horizon. That figure applies to portfolios holding between 30% and 50% in equities. Portfolios skewed more heavily toward stocks actually produce lower starting withdrawal rates because of sequence-of-return risk. A 15% stock allocation sits far outside that optimal range, leaving retirees structurally unable to sustain a modern withdrawal plan.

A Multi-Generational Time Horizon Changes Everything

The more powerful concept Moss raised in a recent episode is one most people managing parental assets never consider: the “family time horizon.” When substantial assets will ultimately pass to heirs, a portfolio does not exist solely for an 85-year-old. It belongs, in a real sense, to the next generation as well.

That mindset shift opens the door to more growth-oriented thinking. Under the SECURE 2.0 Act, workers aged 60 to 63 can make a “super catch-up” contribution to their 401(k) or similar employer-sponsored plan. The IRS has set that enhanced limit at $11,250 for 2026, which replaces (rather than stacks on top of) the standard catch-up available to workers over 50. Combined with the 2026 standard annual deferral of $24,500, workers in that age window can contribute up to $35,750 to a qualifying plan. By managing an inherited or family portfolio more like a 55- or 60-year-old would, an affluent octogenarian can position an estate to outpace inflation for beneficiaries over the decades ahead.

David from California wrote in to Moss’s show explaining that advisors had recommended moving his mother and mother-in-law toward a 60/40 stock-to-bond split. Despite David’s instinct to be more conservative, Moss sided with the advisors. With 10-year Treasury yields climbing to approximately 4.7% by late July 2026, driven by persistent inflationary pressures and a more hawkish Federal Reserve tone, bonds do generate real income today. A 60/40 split also preserves enough capital growth to cover a decade of potential care costs or to leave a meaningful legacy.

The Conversation David Should Have With Those Advisors

Moss recommended that David discuss the actual time frame and spending needs of both women with their advisors. That conversation should cover three specific areas.

1. Specific 2026 income: What do care costs total, and how much does Social Security already cover? The maximum benefit for someone who claims at full retirement age in 2026 is $4,152 per month, while those who delay until age 70 can receive up to $5,181 per month, assuming a maximum earnings history. Both figures reflect the 2.8% COLA applied to 2026 benefits.
2. An honest assessment of estate intent: If assets are likely to pass to heirs, the portfolio’s effective time horizon extends well beyond either woman’s life expectancy, and that changes the math on appropriate risk considerably.
3. The 3.9% stress test: Run the current portfolio balance against annual withdrawals. Morningstar’s research suggests a withdrawal rate at or below 3.9% is sustainable for a balanced portfolio over 30 years. If the family’s actual rate clears that bar, a more equity-heavy allocation is generally defensible on the data.

Editor’s note: This pass updated the 10-year Treasury yield to approximately 4.7%, reflecting late-July 2026 market levels per Trading Economics, and corrected the description of the SECURE 2.0 super catch-up contribution to clarify that the IRS-set 2026 limit of $11,250 replaces rather than supplements the standard age-50-plus catch-up. The 2026 standard 401(k) catch-up for workers over 50 was also updated to $8,000, reflecting the IRS increase from $7,500 in 2025.

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