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How many months of cash in your portfolio do you keep?
09-17-2017, 10:17 AM
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#1
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Thinks s/he gets paid by the post
Join Date: Jul 2007
Location: St. Louis
Posts: 1,563
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How many months of cash in your portfolio do you keep?
When you are retired. Thanks in advance.
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09-17-2017, 10:25 AM
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#2
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Thinks s/he gets paid by the post
Join Date: Sep 2012
Posts: 1,568
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When I was working/accumulating never more than 3-6 months.
Now I'm in "drawdown" (although the rising market has kept drawdown from happening), and after 8 years of up market, I've got about 100 (counting <5 yr CD maturity as cash).
__________________
You know that suit they burying you in? Thar ain’t no pockets in that suit, boy.
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09-17-2017, 10:27 AM
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#3
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gone traveling
Join Date: Dec 2016
Posts: 733
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I'm not retired yet and am not using a portfolio for income, but usually keep a running balance of about 6 months cash in bank accounts. However at this moment I'm sitting on about 30.
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09-17-2017, 10:32 AM
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#4
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Thinks s/he gets paid by the post
Join Date: Jul 2007
Location: St. Louis
Posts: 1,563
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Quote:
Originally Posted by gcgang
When I was working/accumulating never more than 3-6 months.
Now I'm in "drawdown" (although the rising market has kept drawdown from happening), and after 8 years of up market, I've got about 100 (counting <5 yr CD maturity as cash).
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So a little over 8 years of cash.
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09-17-2017, 10:36 AM
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#5
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gone traveling
Join Date: Nov 2011
Location: The Deep South Bay
Posts: 744
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Zero, if I need cash right now I have to sell some gold or silver. I have around $75 that I can withdrawal from my checking account without bouncing anything
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09-17-2017, 10:36 AM
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#6
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Thinks s/he gets paid by the post
Join Date: Jan 2008
Posts: 1,644
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Whatever is in my checking account. On average probably about 4 weeks of spending. Starts out the quarter high when I sweep my quarterly dividends to the bank. By the end of the quarter, I am sometimes down to selling off stocks or bonds to raise cash.
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09-17-2017, 10:41 AM
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#7
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Thinks s/he gets paid by the post
Join Date: Jul 2007
Location: St. Louis
Posts: 1,563
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Quote:
Originally Posted by 97guns
Zero, if I need cash right now I have to sell some gold or silver. I have around $75 that I can withdrawal from my checking account without bouncing anything
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How do you cut it so close?
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How many months of cash in your portfolio do you keep?
09-17-2017, 10:41 AM
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#8
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Moderator Emeritus
Join Date: Jan 2007
Location: New Orleans
Posts: 47,468
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How many months of cash in your portfolio do you keep?
I am retired, and very cautious and conservative in financial matters because that is just how I am.
I keep 5.5% cash in a Vanguard money market account in my portfolio. If I assume that SS and pension will continue, and subtract that from my spending, then right now that 5.5% would cover 41 months.
(Bear in mind that we are enjoying a huge bull market at present, and if/when we have another severe recession, it would not cover nearly as many months.... for example, a recession as deep as what we saw on 3/9/2009 would mean it would cover 28 months, if I did not adjust my spending accordingly.)
Actually I have more than that, because this is not including my local bank account in the bricks-n-mortar bank down the street. I don't count my bank account as part of my portfolio. I withdrew my 2017 spending money back in January and that, plus a substantial buffer, is in the bank. If that is included too, then I have 60 months.
Most people do not need this much, IMO. I just like having a lot of cash around.
__________________
Already we are boldly launched upon the deep; but soon we shall be lost in its unshored, harbourless immensities. - - H. Melville, 1851.
Happily retired since 2009, at age 61. Best years of my life by far!
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09-17-2017, 10:49 AM
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#9
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Thinks s/he gets paid by the post
Join Date: Jul 2007
Location: St. Louis
Posts: 1,563
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Quote:
Originally Posted by W2R
I am retired, and very cautious and conservative in financial matters because that is just how I am.
I keep 5.5% cash in a Vanguard money market account in my portfolio. If I assume that SS and pension will continue, and subtract that from my spending, then right now that 5.5% would cover 41 months.
(Bear in mind that we are enjoying a huge bull market at present, and if/when we have another severe recession, it would not cover nearly as many months.)
Actually I have more than that, because this is not including my local bank account in the bricks-n-mortar bank down the street. I don't count my bank account as part of my portfolio. I withdrew my 2017 spending money back in January and that, plus a substantial buffer, is in the bank. If that is included too, then I have 60 months.
Most people do not need this much, IMO. I just like having a lot of cash around.
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Do you put your dividends into cash?
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09-17-2017, 10:51 AM
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#10
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2003
Location: Florida's First Coast
Posts: 7,654
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About 8 years or so in Cash.
__________________
"Never Argue With a Fool, Onlookers May Not Be Able To Tell the Difference." - Mark Twain
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09-17-2017, 10:53 AM
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#11
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Full time employment: Posting here.
Join Date: May 2007
Posts: 880
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Not much. Typically, 1 or 2 months in bank checking & savings accounts. However, I can write checks on my Vanguard Short Term Investment Grade fund if necessary; that'd be years worth.
__________________
"It is better to have a permanent income than to be fascinating". Oscar Wilde
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09-17-2017, 10:54 AM
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#12
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Nov 2009
Posts: 6,679
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I get a monthly dividend in cash from a big bond fund so I don't actually keep much in cash beyond that - maybe one month just as a buffer to avoid monthly checking account fees plus $500 more. I also get a quarterly dividend in cash from a stock fund to supplement the rest of the cash coming in.
I don't like keeping any big amounts in cash because it earns zilch and any earnings are fully taxable. I do keep a first-tier emergency fund in an intermediate-term muni bond fund.
__________________
Retired in late 2008 at age 45. Cashed in company stock, bought a lot of shares in a big bond fund and am living nicely off its dividends. IRA, SS, and a pension await me at age 60 and later. No kids, no debts.
"I want my money working for me instead of me working for my money!"
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09-17-2017, 10:57 AM
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#13
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Moderator Emeritus
Join Date: Jan 2007
Location: New Orleans
Posts: 47,468
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Quote:
Originally Posted by rec7
Do you put your dividends into cash?
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Absolutely. Then I use the cash in rebalancing during the first week in January, after withdrawing that year's spending money. So, as of today I have 6.21% cash in Vanguard money market (and I guess that represents a few more months than I specified in my previous post). Next January after I withdraw my 2018 spending money and then rebalance, it will go back to 5.5%.
__________________
Already we are boldly launched upon the deep; but soon we shall be lost in its unshored, harbourless immensities. - - H. Melville, 1851.
Happily retired since 2009, at age 61. Best years of my life by far!
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09-17-2017, 11:05 AM
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#14
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gone traveling
Join Date: Nov 2011
Location: The Deep South Bay
Posts: 744
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Quote:
Originally Posted by rec7
How do you cut it so close?
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I know what my monthly expense are and I keep just enough in checking to cover it. I usually don't run it that close but the last couple months have been challenging and I've had to sell some silver.
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09-17-2017, 11:06 AM
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#15
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Thinks s/he gets paid by the post
Join Date: Mar 2017
Location: New York City
Posts: 2,838
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Quote:
Originally Posted by rec7
So a little over 8 years of cash.
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Hahahah, thats definitely a bucket full.!
__________________
Withdrawal Rate currently zero, Pension 137 % of our spending, Wasted 5 years of my prime working extra for a safe withdrawal rate. I can live like a King for a year, or a Prince for the rest of my life. I will stay on topic, I will stay on topic, I will stay on topic
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09-17-2017, 11:08 AM
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#16
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Thinks s/he gets paid by the post
Join Date: Jul 2007
Location: St. Louis
Posts: 1,563
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Quote:
Originally Posted by 97guns
I know what my monthly expense are and I keep just enough in checking to cover it. I usually don't run it that close but the last couple months have been challenging and I've had to sell some silver.
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I am guessing you spend the dividends as they come in.
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09-17-2017, 11:08 AM
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#17
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Thinks s/he gets paid by the post
Join Date: Mar 2017
Location: New York City
Posts: 2,838
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Quote:
Originally Posted by 97guns
Zero, if I need cash right now I have to sell some gold or silver. I have around $75 that I can withdrawal from my checking account without bouncing anything
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Hahahah, thats the direct opposite of the poster above,.
__________________
Withdrawal Rate currently zero, Pension 137 % of our spending, Wasted 5 years of my prime working extra for a safe withdrawal rate. I can live like a King for a year, or a Prince for the rest of my life. I will stay on topic, I will stay on topic, I will stay on topic
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09-17-2017, 11:12 AM
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#18
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jul 2006
Posts: 11,401
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I have a GIC ladder, but as interest rates have been ridiculously low for the last couple of years, I have not renewed the last couple of GICs as they matured. So currently I have about 2 years (24 months) expenses in cash.
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09-17-2017, 11:15 AM
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#19
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Thinks s/he gets paid by the post
Join Date: Jul 2007
Location: St. Louis
Posts: 1,563
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I see answers all over the place here. I guess it is best to keep as little cash as you safety can. Right now I have about 6 years if my dividends get cut in half in a bear market. I think that is a little bit to much. I might cut that in half.
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09-17-2017, 11:17 AM
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#20
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jul 2014
Location: Spending the Kids Inheritance and living in Chicago
Posts: 16,973
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About 5 years worth.
I'd like to reduce it to 3-4 years worth, but am waiting for the next recession or collapse of market before doing that.
If it doesn't happen, I can always just feel super secure not worrying about it happening.
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