← Back to Blog

Glide Path Optimization: How to Adjust Your Allocation Over Time

"100 minus your age in stocks" is terrible advice. Here's why—and what actually works.

What Is a Glide Path?

A glide path is how your asset allocation changes over time. Instead of a static 60/40 portfolio forever, you adjust the mix as you approach and move through retirement.

Target date funds use glide paths. So do smart retirees.

Example glide path:

Age	Stocks	Bonds
30	90%	10%
40	80%	20%
50	70%	30%
60	60%	40%
70	50%	50%
80	40%	60%

The logic: reduce risk as you have less time to recover from crashes.

But this conventional wisdom has a problem.

The "100 Minus Age" Problem

The standard declining glide path (more conservative as you age) actually increases your chance of running out of money.

Why? Sequence of returns risk cuts both ways.

A crash early in retirement is devastating. But so is being too conservative when you're 80 and might live another 20 years.

Research by Wade Pfau and Michael Kitces found that a rising equity glide path—starting conservative and becoming more aggressive—actually improved success rates in many scenarios.

Three Glide Path Strategies

1. Declining (Traditional)

• Start aggressive, end conservative
• 90% to 40% stocks over time
• Intuitive but not always optimal

2. Static

• Maintain same allocation throughout
• e.g., 60/40 forever
• Simple but ignores sequence risk

3. Rising (Research-Backed)

• Start conservative at retirement
• Increase stocks over time
• 40% to 70% stocks
• Counter-intuitive but often superior

Why rising works:

If you retire with 40% stocks and the market crashes in year 1, you lose less. Then you gradually increase stocks when your portfolio has survived the danger zone.

If the market does well early, you miss some upside—but you were never at risk of the worst-case scenario.

How to Find Your Optimal Glide Path

The "best" glide path depends on:

• Your retirement length
• Withdrawal rate
• Expected returns and volatility
• Risk tolerance

Monte Carlo simulation can test different glide paths and show which one maximizes your success probability.

Example comparison:

Glide Path	30-Year Success Rate
Static 60/40	82%
Declining 80 to 40	79%
Rising 40 to 70	87%

In this scenario, the rising glide path wins—but your numbers might be different depending on assumptions.

Implementing a Glide Path

Option 1: Target Date Fund

Vanguard, Fidelity, and Schwab offer target date funds with built-in glide paths. Easy but inflexible—you get their glide path, not one optimized for your situation.

Option 2: Manual Rebalancing

Set calendar reminders to adjust allocation annually. Check your target, rebalance, done.

Option 3: Optimization Tool

Use a calculator that can test multiple glide paths against Monte Carlo simulation. Find the one that maximizes success for your numbers.

Key Takeaways

1. Static allocation ("set and forget") ignores sequence of returns risk
2. Traditional declining glide paths aren't always optimal
3. Rising glide paths (more stocks over time in retirement) often improve success rates
4. The best glide path is personal—test different options with simulation

Don't just pick a number. Test it.

---