The One-Page Investment Plan: Write Your Rules Down Before the Market Tests Them

Take the investor who put $10,000 into the S&P 500 at the October 2007 peak. By March 2009 it was worth about $4,480. Anyone who sold there made that loss permanent. Anyone who held on, with dividends reinvested, was back to $10,000 by August 2012 and had about $68,310 by September 2026.

The plan didn't need to predict the crash. It only needed to decide, ahead of time, what holding through one looks like. That decision is far easier to make on a quiet afternoon than on the worst day of the year, and the table below shows why it is worth making.

Write down each holding and the share of the portfolio it should be, adding up to 100%. Then give each one a single sentence that says why it is there. A fund you can't explain in one sentence is a fund you will sell at the wrong time, because you never knew what job it was doing.

The mix itself should follow from how much risk you can afford to take (your time horizon, income and other savings), not only how much you feel comfortable with. The Risk Profile tool separates the two if you are unsure.

Markets move your mix every day. Rather than reacting to every move, pick a range around each target, measured in percentage points, and act only when a holding leaves it. A common choice is plus or minus 5 points: a 60% target is left alone anywhere from 55% to 65%.

A tighter range means more trades and more taxes in a taxable account; a wider one lets risk build up further before you act. The table shows how big a fall in a 60% holding (with everything else unchanged) it takes before each range says to act.

Decide how much you add each month and where it goes. The simple rule: new money goes to whatever holding is furthest below its target. That rebalances the portfolio without selling anything, which matters in a taxable account where every sale can be a taxable event.

For most people still saving, regular contributions do most of the rebalancing work. Selling is only needed when a move is too large for new money to fix.

This is the decision the whole plan exists for. Start with the arithmetic. In a 60/40 portfolio, if stocks fall 30% and bonds stay flat, stocks drop from 60% to about 51.2% of the portfolio. With a ±5 point range, that is below the 55% floor, so the plan says: rebalance back to 60%, using new money first.

In practice that means buying the thing that just fell, which is exactly what fear tells you not to do. That is why it has to be written down in advance. Write your rule as a sentence you would be willing to read on the worst day. For example: "If a fall pushes my mix outside its range, I rebalance back to target, new money first. I don't change my targets during a fall."

A plan can also say you will hold more cash or fewer stocks. What matters is that the decision is made while you are calm, and that it is the same decision on the day it is tested.

A plan that can be changed whenever it feels wrong is not a plan. Write down the few things that would make you revisit it, and notice that none of them is a market move.

Five answers fit on a single page. Keep it where you will see it, and read it before you make any change to the portfolio. The builder below writes the page with your own funds and numbers, and a free account checks your portfolio against it every month, so you don't have to remember to.