Late Sixties and Beyond by Burton Malkiel
The Late Sixties and Beyond Portfolio is one of the age-based model allocations presented by Burton Malkiel in his classic book A Random Walk Down Wall Street, first published in 1973 and updated through multiple editions. Malkiel, a Princeton economics professor and former member of the Council of Economic Advisers, developed a series of life-cycle allocations designed for investors at different stages of life. The late-sixties-and-beyond version is the most conservative, designed for investors who have reached or passed typical retirement age and prioritise capital preservation and income over growth.
Investment Philosophy
Malkiel's age-based allocation philosophy holds that as investors age, they should progressively shift from equities toward bonds and cash, reducing the portfolio's exposure to short-term market volatility as the time horizon shortens and the ability to recover from large drawdowns diminishes. The late-sixties portfolio reflects this by holding a heavy majority in fixed income and cash-equivalent assets, with only a modest equity allocation to provide some inflation protection.
Who It's For
This portfolio is designed for retirees in their late sixties or beyond who are drawing down their portfolio for living expenses and cannot afford to sustain large losses from equity market downturns. It suits investors with a low risk tolerance and a primary objective of capital preservation and income generation.
Pros
- High fixed-income and cash weighting provides strong protection against equity market declines
- Simple structure that is easy to understand and manage in retirement
- Small equity allocation retains some inflation-fighting capacity
Cons
- Limited equity exposure may be insufficient to protect purchasing power during extended inflationary periods
- Low expected long-run return means the portfolio may not sustain decades of retirement spending without significant depletion
- Bond holdings are exposed to interest rate risk, creating potential capital losses in rising-rate environments
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Target Allocation
Performance Snapshot
Rolling Returns
| Period | Low | Average | High |
|---|---|---|---|
| 1 Year | -31.9% | +7.5% | +45.3% |
| 3 Year | -8.2% | +6.8% | +20.4% |
| 5 Year | -1.1% | +6.8% | +16.0% |
| 10 Year | +3.0% | +6.9% | +10.8% |
Growth of $10,000
Historical Drawdown
Percentage decline from the portfolio's peak value at each point in time.
Rolling Returns
Annualised return for each rolling period ending on that date.
Annualised return for each 1Y period ending on that date.