How much of your net worth do you hold in cash?

General
21

Arun said:
@Emily
I wouldn’t consider a new car an ‘emergency expense.’ For stuff like that, I’d use the emergency fund only if there was an unexpected repair, then work to build it back up.

I said ‘big ticket expense,’ not emergency. Big difference! But I see what you mean.

22

Drew said:
We keep about 9 months of living expenses on hand, but no way would I invest that in stocks or anything that risky. Every other dollar is in investments as soon as it comes in.

Good approach. I do 8 months, just enough of a cushion to be safe while keeping the rest invested.

23

Drew said:
We keep about 9 months of living expenses on hand, but no way would I invest that in stocks or anything that risky. Every other dollar is in investments as soon as it comes in.

Same here.

24

I just keep about 6 months’ worth of bills covered, maybe a little more. So the percentage changes here and there.

25

Right now, about 5%.

26

1.25% here. Holding too much cash feels like missed opportunity unless it’s short-term.

27

Cash in bonds, CDs, and a little in physical gold and silver. I’d say around 5-10% total.

28

Crosby said:
1.25% here. Holding too much cash feels like missed opportunity unless it’s short-term.

I mostly have VOO in my IRA. If I really needed cash, I’d sell it and transfer the money to my bank. Takes a couple of days, but why hold a ton of cash otherwise?

29

@Maverick
Is that a Roth?

30

Parker said:
@Maverick
Is that a Roth?

Could someone clarify the differences in how Roth vs. traditional would impact selling and accessing funds quickly?

31

Crosby said:
1.25% here. Holding too much cash feels like missed opportunity unless it’s short-term.

Exactly. I don’t see why anyone would hold a ton of cash when they could have it in bonds or something.

32

@Oak
We’re talking ‘cash’ here as in liquid assets that are earning. Like, I keep some actual cash at home, but then we have about 6-9 months in a money market fund getting nearly 5%.

33

Keegan said:
@Oak
We’re talking ‘cash’ here as in liquid assets that are earning. Like, I keep some actual cash at home, but then we have about 6-9 months in a money market fund getting nearly 5%.

Where are you getting that kind of return? I’d love to do better than my current savings account.

34

@Payton
VUSXX is one option.

35

@Payton
Or any decent HYSA.

36

@Payton
SGOV could work too, plus no state taxes.

37

Keegan said:
@Oak
We’re talking ‘cash’ here as in liquid assets that are earning. Like, I keep some actual cash at home, but then we have about 6-9 months in a money market fund getting nearly 5%.

Right, my ‘cash’ is mostly in a CD ladder, some at 5.12%. I could pull it out in a pinch; the penalty would be worth it if I needed the funds that badly.

38

@Oak
Just a heads up that bonds can drop in value, especially during a financial crisis, which is usually when people need cash the most. It can sting to sell at a loss.

39

I keep about 12 months in T-bills, so around 10% of my net worth.

40

Dorian said:
I keep about 12 months in T-bills, so around 10% of my net worth.

I’ve got around $10k in T-bills for my wife and me, but isn’t there a $10k cap per person? Or am I confused?

Edit: Think I might actually have I Bonds instead. So T-bills might not have a cap?