Calculating fixed income percentage

So today i continue my theme of fixed income and tell you my way of finding out percentage of fixed income to portfolio. Following calculations only give you an average so you still want to have more in fixed income in uncertain timesa and less when we are in bull market(markets going up for long term).

First you should plan how much on average you want to save from your sallary. I would safe at least 10% but that is for you to decide. Helping you to figure required numbers , there are investing calculators like this. So basically you just put the years when you want to have certain amount of money and monthl, amount of monthly investments, desired yearly return rate and you then get future amount of your investments. So play with those numbers until you get what you want. Average yerly return is somewhere between index returns of stockmarket and banks interest rates. I got 14% as my average yearly return which is high but i like a challenge :)

In following picture i will show you how to find out fixed income percentage using that number that you got from the calculator. You also want to have rough estimates of how much is yearly return rate of stocks and funds and fixed income.
And following calculations give you on an average so you still want to put more money to fixed income if economy is uncertain.