I'm curious--I've been reading about methods to mitigate SOR risk and one of the methods cited seems to be to keep 3 yrs expenses in cash. Makes a ton of sense until I realized that using the proverbial 25x expenses, this is ~12% cash. Even more if you ER and are waiting for SS to kick in and cover some of those expenses. This seems like a big chunk of a portfolio sitting in cash with respect to asset allocation.
I'm sure I'm missing something basic... Is this actually in bonds vs cash? Are people just using minimal SHTF expenses to keep in cash?
I'm sure I'm missing something basic... Is this actually in bonds vs cash? Are people just using minimal SHTF expenses to keep in cash?