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I am sure the answer is not zero unless you consider CD's not to be cash and maybe the same for very short term bond funds. I think you need a cash fund for several reasons but if you put all your cash in CD's that had a penalty if you cash them in I would still count that as cash.
Well he/she certainly hasn't been back to answer so we may never know
OK so "trick" isn't the right word but it was late.
Half the country plans poorly... Doesn't shock me one bit. I think that has to do with the level of income. I wonder how those numbers change as incomes go up.
An emergency fund is one OPTION in a financial plan, not a requirement. (source me: BS Finance, MBA. in financial services for 10+ years, more licenses than 99% of your "planners" out there)
this is actually spot on! I have seen more high income broke people than low income broke people!
I have around $55,000 in cash right now. I need to do something better with it, it gets around 3% in my checking account. We also have $250,000 in 401K's, so not really wanting to dump even more in there, only in mid 30's so I think we're very fortunate right now.
I don't think I would want to go below $10,000 in reserves, I would get worried. I keep around $3,500 in cash stashed in the house as well, my husband thinks I'm silly, but I like having cash on hand.
Probably watching too many dystopia movies where i'll want hard currency to get supplies when it all hits the fan, haha.
I have around $55,000 in cash right now. I need to do something better with it, it gets around 3% in my checking account. We also have $250,000 in 401K's, so not really wanting to dump even more in there, only in mid 30's so I think we're very fortunate right now.
I don't think I would want to go below $10,000 in reserves, I would get worried. I keep around $3,500 in cash stashed in the house as well, my husband thinks I'm silly, but I like having cash on hand.
Probably watching too many dystopia movies where i'll want hard currency to get supplies when it all hits the fan, haha.
Where is your checking account that is paying 3% on cash balances?
I keep 2 year reserve in my checking account. I don't care to move into CD because I hate paperwork. But I have a large home equity that if I need I can tap.
All depends on each situation... Lets say you're married and both work. Ones a tenured teacher another a government union employee, you can cover all expenses with either one of your paychecks. The chances of you both becoming unemployed at the same time is extremely extremely low. You'd likely be fine with 3 months cash or less.
Now if you're the single earner in your family and self-employed you should really have a year of bills saved minimum.
My wife and I both work, she has a super secure job like mentioned above, mine less so but not terrible. Either one of our pay checks will cover all our expenses. So even if we only had 1 month bills saved we're probably still financially more secure than a single earner with 6 months of bills saved. Just the same we keep 6 months worth of bills as cash in a federal credit union savings account.
63% do not even have $500 to cover emergency.
Sad but a fact.
For those lucky rest of us...
Well we lucky.
My 6 months reserve is more than cash.
It's diverse to cover even basics (learn from our pets.. what's most important).. like if Venezuela happens.
Eg. Enuff food to last till growing into harvest seasons.
One currency cash could devalue into funny monies like in Venezuela.. drop in value overnite.
Banks like stock markets is not going to "warn" you..
You are not insiders... Most aren't.
By the time word gets out.. it's usually too late.
6 months is minimal prep for reserves.. the longer the better.
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