What is the relationship between risk profile and retirement investing?

Risk profile refers to the tolerance and ability to take risks when investing. Broadly speaking, the longer your investment horizon, the greater your ability to take risks. If retirement is still a long way off, you might want to consider riskier investments, such as equities, which have historically offered higher long-term returns. As you approach retirement, it is advisable to gradually reduce your risk in order to protect the assets you may have accumulated.