Problems With The Traditional 60/40 Approach

In an ideal world, nothing beats a savings account. You take your hard-earned money, hand it over to the bank down the block, and watch as your account balance steadily grows over. Unfortunately, in a world where even a 0.5% rate on a savings account is rare to non-existent, this is going to hurt you over time. If the interest you are receiving from the bank is less than the inflation rate (generally 2-3% per year over the past decade) you are losing money each and every day you keep your money in the bank. The balance might not change, but the real value is most certainly declining as your interest income fails to ‘make you whole’ against increases in the costs...