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During the investment process, the issue of asset allocation comes up. Asset allocation is the method of dividing your investments into the major asset classes of cash, bonds, and stocks. The investment returns you seek and the amount of risk you are willing to take will influence how your money will be allocated.
Personal Things To Consider
When determining your asset allocation, there are various factors to consider. They include:
Your age
Your income
Your assets (includes your home, cash and investment portfolio)
Your debts (includes mortgage and line of credit)
Years to retirement
All these personal considerations will help determine how aggressive or conservative your investment portfolio should be.
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