In the long term, 100/0/0 has outperformed every other allocation, with added volatility. Since I'll have 1-2 years of cash/cash equivalents, I will take money out of the market in up times, and out of the cash bucket in down times.
One thought that I would like to throw out especially for newbies to investing who might not realize there is something called
Sequence of Return Risk.
While 100% in stocks may be the best long term, one must be aware that we don't earn the average every year. In fact there are down years, even several down years in a row are possible. And those downs can be very steep, such as the 40% haircut people took in the mid 70's.
The problem is that if one's investments are hit very early with a BIG Bear market that drives stocks
down, Down and DOWN, and on top of that one has to sell some stocks at very low prices in order to pay the rent and put food on the table, well..... There may not enough left to earn it back even with a vigorous recovery.
Getting hit early by a huge down market is what
sequence of return risk is all about, and it is something to be avoided if at all possible. Having several years (4 years, IMHO) spending cash in a safe investment is one way to do that.
Another safeguard is have simply have some quality bonds (IOW, 60/40, 70/30 etc.) that can be sold while one waits for the market to recover. Keep in mind, it could be a long wait. Markets don't always go up after a fall, sometimes they tread water at the same level for years.
Every coin has two sides and sometimes somebody gets lucky and retires just as the market booms for year after year after year. Then, that person - who planned on a pleasant but limited retirement - suddenly finds that he/she can jet to Paris for a Sunday meal at Le RitzyGourmand every few months.