Setting portfolio expectations for 2026

WE ARE heading towards “New Year’s resolution” territory again. One of the areas many people promise to focus on is their retirement plan. While the theory behind how best to do this is relatively simple – pay off expensive debt, spend less, save more and invest – the practice is a lot more complicated. How much do I need to save? What should I invest in? And, what returns can I expect on my investments? These are all complicated questions.

The first two are very personal decisions, depending on the type of lifestyle you want during retirement and your ability to withstand market drawdowns. Without making assumptions on the third question, though, the first two are impossible to answer. So, let’s start there.

Returns expectations

When looking at expected returns, it is important to acknowledge that: 1) nobody has a crystal ball; and 2) the shorter the time horizon, the greater the level of uncertainty.