What is the best resource for determining a specific age-based asset allocation?
Look into the asset allocations of lifecycle funds offered by a company like Vanguard. This page allows you to select your current age and find a fund based on that. You could pick a fund, like the Target Retirement 2055 Fund (ages 21-25), and examine its allocation in the Portfolio & Management tab. For this fund, the breakdown is: Then, look at the allocation of the underlying funds that comprise the lifecycle fund, in the same tab.  Look at each of those funds and see what asset allocation they use, and that should give you a rough idea for an age-based allocation. For example, the Total Stock Market Index Fund page has a sector breakdown, so if you wanted to get very fine-grained with your allocation, you could. (You're probably much better off investing in the index fund, low-cost ETFs, or the lifecycle fund itself, however; it'll be much cheaper).  Doing this for several lifecycle funds should be a good start. Keep in mind, however, that these funds are rebalanced as the target date approaches, so if you're following the allocation of some particular funds, you'll have to rebalance as well. If you really want an age-based allocation that you don't have to think about, invest in a lifecycle fund directly. You'll probably pay a lower expense ratio than if you invested in a whole slew of funds directory, and it's less work for someone who isn't comfortable managing their portfolio themselves. Furthermore, with Vanguard, the expense ratios are already fairly low.  This is only one example of an allocation, however; your tolerance of risk, age, etc. may affect what allocation you're willing to accept.  Full disclosure: Part of my Roth IRA is invested in the Target 2055 fund I used as an example above, and another part uses a similar rebalancing strategy to the one I used above, but with Admiral Share funds, which have higher minimum investments but lower expense ratios.
Take the easy approach - as suggested by John Bogle (founder of Vanguard - and a man worthy of tremendous respect). Two portfolios consisting of 1 index fund each. Invest your age% in the Fixed Income index fund. Invest (1-age)% in the stock index fund.  Examples of these funds are the Total Market Index Fund (VTSMX) and the Total Bond Market Index (VBMFX). If you wish to be slightly more adventurous, blend (1-age-10)% as the Total Market Index Fund and a fixed 10% as Total International Stock Index (VGTSX).  You will sleep well at night for most of your life. @bstpierre gave you an example of a portfolio similar to IFA's 70 portfolio. Please, look other variants of example portfolios there and investigate which would suit to you.  Although the example portfolios are not ETF-based, required by the op, you can rather easily check corresponding components with this tool here. Before deciding your portfolio, fire up a spreadsheet (samples here) and do calculations and do not underestimate things below: Bogleheads have already answered this type of questions so why not look there? Less reinventing the wheel: google retirement portfolios site:bogleheads.org. I am not making any recommendations like other replies because financial recommendations devalue. I hope I steered you to the right track, use less time to pick individual funds or stocks and use more time to do your research. he general advice I get is that the younger you are the more higher risk investments you should include in your portfolio. I will be frank. This is a rule of thumb given out by many lay people and low-level financial advisors, but not by true experts in finance.  It is little more than an old wive's tale and does not come from solid theory nor empirical work.  Finance theory says the following: the riskiness of your portfolio should (inversely) correspond to your risk aversion.  Period. It says nothing about your age.  Some people become more risk-averse as they get older, but not everyone.  In fact, for many people it probably makes sense to increase the riskiness of their portfolio as they age because the uncertainty about both wealth (social security, the value of your house, the value of your human capital) and costs (how many kids you will have, the rate of inflation, where you will live) go down as you age so your overall level of risk falls over time without a corresponding mechanical increase in risk aversion. In fact, if you start from the assumption that people's aversion is to not having enough money at retirement, you get the result that people should invest in relatively safe securities until the probability of not having enough to cover their minimum needs gets small, then they invest in highly risky securities with any money above this threshold. This latter result sounds reasonable in your case.  At this point it appears unlikely that you will be unable to meet your minimum needs--I'm assuming here that you are able to appreciate the warnings about underfunded pensions in other answers and still feel comfortable.  With any money above and beyond what you consider to be prudent preparation for retirement, you should hold a risky (but still fully diversified) portfolio.  Don't reduce the risk of that portion of your portfolio as you age unless you find your personal risk aversion increasing. "ycharts.com has ""Weighted Average PE Ratio"" and a bunch of other metrics that are meant to correspond to well known stock metrics.  Other websites will have similar ratios." I spent a while looking for something similar a few weeks back and ended up getting frustrated and asking to borrow a friend's Bloombterg.   I wish you the best of luck finding something,  but I wasn't able to.   S&amp;P and Morningstar have some stuff on their site,  but I wasn't able to make use of it.  Edit: Also,  Bloomberg allows shared terminals.  Depending on how much you think as a firm,  these questions might come up,  it might be worth the 20k / year John Bogle never said only buy the S&P 500 or any single index Q:Do you think the average person could safely invest for retirement and   other goals without expert advice -- just by indexing? A: Yes, there is a rule of thumb I add to that. You should start out   heavily invested in equities. Hold some bond index funds as well as   stock index funds. By the time you get closer to retirement or into   your retirement, you should have a significant position in bond index   funds as well as stock index funds. As we get older, we have less time   to recoup. We have more money to protect and our nervousness increases   with age. We get a little bit worried about that nest egg when it's   large and we have little time to recoup it, so we pay too much   attention to the fluctuations in the market, which in the long run   mean nothing. How much to pay Q: What's the highest expense ratio that one should pay for a   domestic equity fund? A: I'd say three-quarters of 1 percent maybe.   Q: For an international fund?  A: I'd say three-quarters of 1 percent.   Q: For a bond fund? A: One-half of 1 percent. But I'd shave that a little bit. For   example, if you can buy a no-load bond fund or a no-load stock fund,   you can afford a little more expense ratio, because you're not paying   any commission. You've eliminated cost No. 2.... "This is basically what financial advisers have been saying for years...that you should invest in higher risk securities when you are young and lower risk securities when you get older. However, despite the fact that this is taken as truth by so many financial professionals, financial economists have been unable to formulate a coherent theory that supports it.  By changing the preferences of their theoretical investors, they can get solutions like putting all your investments in a super safe asset until you get to a minimum survival level for retirement and then investing aggressively and many other solutions.  But for none of the typically assumed preferences does investing aggressively when young and becoming more conservative as you near retirement seem to be the solution.  I'm not saying there can be no such preferences, but the difficulty in finding them makes me think maybe this idea is not actually correct. Couple of problems with your intuition that you should think about: It's not clear that things ""average out"" over time.  If you lose a bunch of money in some asset, there's no reason to think that by holding that asset for a while you will make back what you lost--prices are not cyclical.  Moreover, doesn't your intuition implicitly suggest that you should transition out of risky securities as you get older...perhaps after having lost money? You can invest in safe assets (or even better, the tangency portfolio from your graph) and then lever up if you do want higher risk/return.  You don't need to change your allocation to risky assets (and it is suboptimal to do so--you want to move along the CAL, not the curve). The riskiness of your portfolio should generally coincide (negatively) with your risk-aversion.  When you are older and more certain about your life expectancy and your assets, are you exposed to more or less risks?  In many cases, less risks.  This means you would choose a more risky portfolio (because you are more sure you will have enough to live on until death even if your portfolio takes a dive). Your actual portfolio consists both of your investments and your human capital (the present value of your time and skills).  When you are young, the value of this capital changes significantly with market performance so you already have background risk.  Buying risky securities adds to that risk.  When you are old, your human capital is worth little, so your overall portfolio becomes less risky.  You might want to compensate by increasing the risk of your investments. EDIT: Note that this point may depend on how risky your human capital is (how likely it is that your wage or job prospects will change with the economy). Overall the answer to your question is not definitively known, but there is theoretical evidence that investing in risky securities when young isn't optimal. Having said that, most people do seem to invest in riskier securities when young and safer when they are older. I suspect this is because with life experience people become less optimistic as they get older, not because it is optimal to do so.  But I can't be sure." My personal gold/metals target is 5.0% of my retirement portfolio. Right now I'm underweight because of the run up in gold/metals prices. (I haven't been selling, but as I add to retirement accounts, I haven't been buying gold so it is going below the 5% mark.) I arrived at this number after reading a lot of different sample portfolio allocations, and some books. Some people recommend what I consider crazy allocations: 25-50% in gold. From what I could figure out in terms of modern portfolio theory, holding some metal reduces your overall risk because it generally has a low correlation to equity markets. The problem with gold is that it is a lousy investment. It doesn't produce any income, and only has costs (storage, insurance, commissions to buy/sell, management of ETF if that's what you're using, etc). The only thing going for it is that it can be a hedge during tough times. In this case, when you rebalance, your gold will be high, you'll sell it, and buy the stocks that are down. (In theory -- assuming you stick to disciplined rebalancing.) So for me, 5% seemed to be enough to shave off a little overall risk without wasting too much expense on a hedge. (I don't go over this, and like I said, now I'm underweighted.) As sdg said, the consensus is that the CPP is pretty solid.  An actuarial report is submitted to Parliament every three years, and it's worth getting the numbers from that report so you know where your CPP contributions are invested.  You may think there's more risk in CPP's portfolio than they let on.  Either way, your own savings and investments are the best defense against inadequacy of the CPP.  But you should be careful, as the CPP mostly invests in the same stuff the retail investor does - equity and fixed income.  So the typical investor will be exposed to the risks as the CPP fund. However, CPP is not the only source of retirement income for Canadians.  There is also the Guaranteed Income Supplement and Old Age Security, and they are funded differently from CPP.  CPP benefits are funded by returns from the investment fund, as well as contributions.  GIS and OAS are paid out of the Government of Canada's revenue each year.  In my opinion, those programs are more vulnerable than CPP as they could just be legislated out of existence in tough economic times.  (However, I also see that as unlikely because the elderly are a pretty powerful block of voters.) Here is one the links for Goldmansachs. Not to state the obvious, but most of their research is only available to their clients. http://www.goldmansachs.com/research/equity_ratings.html "The ""Money 70"" is a fine list: http://money.cnn.com/magazines/moneymag/bestfunds/index.html Money magazine is usually more reasonable than the other ones (SmartMoney, Kiplinger's, etc. are in my opinion sillier). If you want a lot of depth, the Morningstar Analyst Picks are useful but you have to pay for a membership which is probably not worth it for now: http://www.morningstar.com/Cover/Funds.aspx (side note: Morningstar star ratings are not useful, I'd ignore those. analyst picks are pretty useful.) Vanguard is a can't-go-too-wrong suggestion. They don't have any house funds that are ""bad,"" while for example Fidelity has some good ones mixed with a bunch that aren't so much. Of course, some funds at Vanguard may be inappropriate for your situation. (Vanguard also sells third-party funds, I'm talking about their own branded funds.) If getting started with 5K I think you'd want to go with an all-in-one fund like a target date retirement fund or a balanced fund. Such a fund also handles rebalancing for you. There's a Vanguard target date fund and balanced fund (Wellington) in the Money 70 list. fwiw, I think it's more important to ask how much risk you need to take, rather than how much you are willing to take. I wrote this down at more length here: http://blog.ometer.com/2010/11/10/take-risks-in-life-for-savings-choose-a-balanced-fund/ First pick your desired asset allocation, then pick your fund after that to match. Good luck." "Here is the ""investing for retirement"" theoretical background you should have. You should base your investment decisions not simply on the historical return of the fund, but on its potential for future returns and its risk. Past performance does not indicate future results: the past performance is frequently at its best the moment before the bubble pops. While no one knows the specifics of future returns, there are a few types of assets that it's (relatively) safe to make blanket statements about: The future returns of your portfolio will primarily be determined by your asset allocation . The general rules look like: There are a variety of guides out there to help decide your asset allocation and tell you specifically what to do. The other thing that you should consider is the cost of your funds. While it's easy to get lucky enough to make a mutual fund outperform the market in the short term, it's very hard to keep that up for decades on end. Moreover, chasing performance is risky, and expensive. So look at your fund information and locate the expense ratio. If the fund's expense ratio is 1%, that's super-expensive (the stock market's annualized real rate of return is about 4%, so that could be a quarter of your returns). All else being equal, choose the cheap index fund (with an expense ratio closer to 0.1%). Many 401(k) providers only have expensive mutual funds. This is because you're trapped and can't switch to a cheaper fund, so they're free to take lots of your money. If this is the case, deal with it in the short term for the tax benefits, then open a specific type of account called a ""rollover IRA"" when you change jobs, and move your assets there. Or, if your savings are small enough, just open an IRA (a ""traditional IRA"" or ""Roth IRA"") and use those instead. (Or, yell at your HR department, in the event that you think that'll actually accomplish anything.)" My equities portfolio breaks down like this: (I'm 26 years old, so it is quite aggressive) Additionally, I have a portfolio of direct real estate investments I have made over the past 4 years.  I invested very aggressively into real estate due to the financial crisis. As a result of my aggressive investing & strong growth in real estate, my overall asset breakdown is quite out of balance. (~80% Real Estate, ~20% Equities) I will be bringing this into a more sensible balance over the next few years as I unwind some of my real estate investments & reinvest the proceeds into other asset classes. As for the alternative asset groups you mentioned, I looked quite seriously at Peer to Peer lending a few years back. (Lending Club) However, interest rates were quite low & I felt that Real Estate was a better asset class to be in at the time.   Furthermore, I was borrowing heavily to fund real estate purchases at the time, and I felt it didn't make much sense to be lending cash & borrowing at the same time.  I needed every dime I could get a hold of.  :)  I will give it another look once rates come back up. I've shied away from investing in things like actively managed mutual funds, hedge funds, etc ... not because I don't think good managers can get superior returns ... rather, in my humble opinion, if they DO get above average returns then they simply charge higher management fees to reflect their good performance. Hope this helps! "Making these difficult portfolio decisions for you is the point of Target-Date Retirement Funds.  You pick a date at which you're going to start needing to withdraw the money, and the company managing the fund slowly turns down the aggressiveness of the fund as the target date approaches.  Typically you would pick the target date to be around, say, your 65th birthday.  Many mutual fund companies offer a variety of funds to suit your needs. Your desire to never ""have to recover"" indicates that you have not yet done quite enough reading on the subject of investing.  (Or possibly that your sources have been misleading you.)  A basic understanding of investing includes the knowledge that markets go up and down, and that no portfolio will always go up.  Some ""recovery"" will always be necessary; having a less aggressive portfolio will never shield you completely from losing money, it just makes loss less likely. The important thing is to only invest money that you can afford to lose in the short-term (with the understanding that you'll make it back in the long term).  Money that you'll need in the short-term should be kept in the absolute safest investment vehicles, such as a savings account, a money market account, short-term certificates of deposit, or short-term US government bonds." The vanilla advice is investing your age in bonds and the rest in stocks (index funds, of course). So if you're 25, have 75% in stock index fund and 25% in bond index. Of course, your 401k is tax sheltered, so you want keep bonds there, assuming you have taxable investments. When comparing specific funds, you need to pay attention to expense ratios. For example, Vanguard's SP 500 index has an expense ratio of .17%. Many mutual funds charge around 1.5%. That means every year, 1.5% of the fund total goes to the fund manager(s). And that is regardless of up or down market. Since you're young, I would start studying up on personal finance as much as possible. Everyone has their favorite books and websites. For sane, no-nonsense investment advise I would start at bogleheads.org. I also recommend two books -  This is assuming you want to set up a strategy and not fuss with it daily/weekly/monthly. The problem with so many financial strategies is they 1) don't work, i.e. try to time the market or 2) are so overly complex the gains are not worth the effort. I've gotten a LOT of help at the boglehead forums in terms of asset allocation and investment strategy. Good luck!