Let's say you choose an investment portfolio that's 60% stocks, 40% bonds. That's the one that lines up with your goals in this example. Over the course of weeks and months, the stock portion of your portfolio might outperform bonds and become an even bigger piece of the pie. Maybe it's 70% stocks, 30% bonds now. To get your asset allocation back to your 60/40 portfolio, you'll want to sell 10% from stocks and add it to bonds. Most Robo advisors and retirement plans make this super simple with an automatic rebalance feature. Turn it on, and you're good to go.
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