How to Manage Our Asset Allocation

Personal finance books and websites discuss about risk appetites in engaging into investments suitable for our own personal short-term and long-term needs.  It has been a wonder to me what the “proper” asset allocation would be for all assets available in the market: equities, bonds, cash, and alternative assets (such as real estates, and businesses).  I believe that part of managing our personal finances is creating a system to where we would like to put our assets on that would give us passive and earned income in the coming years.