35-Year-Old Says His $300,000 Portfolio Was Flagged As 'Too Aggressive For His Age' – Asks Suze Orman If It's Really Time To Switch To Bonds

In May 2024, Suze Orman's podcast featured an interesting guest, Alex, a 35-year-old investor crushing it by most measures. With $300,000 saved in a mix of a 401(k) and an IRA – both smartly invested in low-cost index funds – he's light-years ahead of where most people his age are financially. At 35, retirement still feels far away, but society, financial advisors and even the little warnings on investment platforms keep hammering home that it's never too early to plan.

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Alex is proud of his financial progress – rightfully so. But as he explained to Orman, Fidelity's website has flagged his portfolio as too aggressively invested for his age and the suggestion to start shifting into bonds left him skeptical. "I understand the logic of shifting toward bonds when you approach retirement, but starting to do this at 35 seems crazy to me."

Orman was quick to address the concern. She acknowledged that there's a case for bonds in specific scenarios. "So I could make a case just so you know that if the feds start to lower interest rates, you and Alex are invested especially in long-term bonds, that as interest rates go down, the value of bonds will go up. So you could make a nice little sum of money with bonds."

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But she didn't stop there. Orman had some reservations about how Alex might add bonds to his portfolio. "I wouldn't be doing it through a target date mutual fund. I would be doing it through buying individual long-term treasuries at Fidelity."

Despite pointing out the potential upside of bonds, Orman ultimately advised Alex to stay the course. "If I were you, I would just continue to do exactly what you are doing because at 35 and you already have $300,000 saved, I think you're doing just fine." 

Her advice was clear: don't let temporary market fears or cookie-cutter advice derail your long-term plan. "If the markets happen to crash, they go down, just keep doing it, buy more of great quality stocks, ETFs, whatever it is that you may invest in over time and later on, you'll be so happy that you did. I think there's more money to be made doing it the way you're doing it."

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While Orman's advice makes sense for someone with Alex's time horizon and discipline, ignoring bonds altogether might not sit well with everyone. Some investors prefer the stability even a small bond allocation can bring, especially during volatile markets. 

Bonds might not offer the same growth potential as stocks but can add balance to a portfolio. Still, Alex's skepticism about Fidelity's target-date funds with higher expense ratios isn't misplaced and Orman's suggestion to stick with low-cost index funds aligns with most expert advice.

As with all financial decisions, Alex's next move should be guided by his personal goals and comfort with risk. Consulting a financial advisor could help him decide whether his current strategy is the best fit or if a slight tweak – like adding some individual bonds – might provide peace of mind without sacrificing long-term growth. 

For now, though, Orman's endorsement of his plan and her reminder to keep going through market dips should give Alex plenty of confidence to keep building toward his future.

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