As individuals approach their 50s, retirement planning takes on greater urgency. During this decade, many investors start seriously shoring up their nest eggs to ensure a comfortable lifestyle in their golden years. Esteemed economist Burton Malkiel, author of the investing classic A Random Walk Down Wall Street, has proposed a "lazy portfolio" specifically tailored for those in their mid-50s.

The lazy portfolio concept advocates a simple, diversified buy-and-hold approach with annual rebalancing across multiple asset classes. For the 50-something set, Malkiel emphasizes exposure to both domestic and international equities, as well as resilience against inflation through strategic bond allocations.

It's noticeable that Malkiel emphasized international and emerging market stocks and had some interesting bond allocations including long term corporate bonds and inflation protected bonds. 

Asset Allocation:

• Total Stock Allocation: 74.5%

1. US Stocks:

   • VTI (Vanguard Total Stock Market ETF): 27%
   • VIG (Vanguard Dividend Appreciation ETF): 7%
     • VTI and VIG offer exposure to a broad range of U.S. equities, capturing both overall market performance and dividend-paying stocks for stability and income.

2. International Stocks:

   • VEA (Vanguard FTSE Developed Markets ETF): 14%
   • VWO (Vanguard FTSE Emerging Markets ETF): 14%
     • VEA and VWO provide diversification by investing in developed and emerging market stocks outside the U.S., tapping into growth opportunities beyond domestic markets.

3. REITs (Real Estate Investment Trusts):

   • VNQ (Vanguard Real Estate ETF): 12.5%
     • VNQ invests in real estate companies, offering exposure to the real estate market and potential dividend income, serving as a hedge against inflation.

Bond Allocation:

• Total Bond Allocation: 20.5%

1. Long-Term Corporate Bonds:

   • LQD (iShares iBoxx $ Investment Grade Corporate Bond ETF): 7%
     • LQD invests in investment-grade corporate bonds with longer maturities, providing income potential with slightly higher risk compared to government bonds.

2. International Bonds:

   • BNDX (Vanguard Total International Bond ETF): 7%
     • BNDX offers exposure to a diversified portfolio of international investment-grade bonds, enhancing diversification and potentially reducing overall portfolio risk.

3. Inflation-Protected Bonds:

   • TIP (iShares TIPS Bond ETF): 6.5%
     • TIP invests in Treasury Inflation-Protected Securities (TIPS), which adjust for inflation, helping to preserve purchasing power and mitigate inflation risk.

Other:

• Cash: 5%
  • Holding a portion of the portfolio in cash provides liquidity and flexibility for opportunistic investments or to cover short-term expenses without the need to liquidate other assets.

This lazy portfolio for mid-fifties investors is designed to provide a balanced mix of assets, including domestic and international stocks, real estate, and various types of bonds. The strategy aims for long-term growth while managing risk through diversification and periodic rebalancing.

This portfolio is annually rebalanced. 

Holdings:
USStocks VTI 27%
USDividendStocks VIG 7%
IntlStocks VEA 14%
EmergingMktStocks VWO 14%
REITs VNQ 12.5%
LongTermCorpBonds LQD 7%
IntlBonds BNDX 7%
InflationProtectedBonds TIP 6.5%
Cash CASH 5%

Simulated from 06/04/2013