How much CASH or liquid do you have?

[Enuff2Eat]

Forget about NETWORTH. It is so misleading and sometime useless information for someone current situation.

If I have mortgage to pay and bills pilling up NOW then $0.5 million dollar of networh that sitiing in my house, my cars, my 401k, my IRA doesn't really help.

People that has $5000/mon. from retirement and has zero networth is better of than people that has $300k networth but zero cash.

enuff

 

[REWahoo]

Forget about NETWORTH.

OK, forgotten.

Anything else on your mind this morning?

PS - In response to how much liquid I have, my well has a 2,500 gallon water storage tank...

 

[Alan]

I have enuff2CmeOK for many years.

 

[growing_older]

I used to keep 6 months liquid in a money market account (the so-called emergency fund). But in 20 years, including various downturns, job losses, house repairs and other unexpected needs for short term funds, I never touched it. I could always find some way to pay for what I needed or sell an investment if necessary. So, with rates as low as they are, I've just swept the "emergency fund" into the rest of my asset allocation now. I have a month worth of expenses on hand (earning almost nothing) because I couldn't talk myself into going without an "emergency fund" entirely.

 

[Alan]

If I have mortgage to pay and bills pilling up NOW then $0.5 million dollar of networh that sitiing in my house, my cars, my 401k, my IRA doesn't really help.
enuff

I used to keep 6 months liquid in a money market account (the so-called emergency fund). But in 20 years, including various downturns, job losses, house repairs and other unexpected needs for short term funds, I never touched it. I could always find some way to pay for what I needed or sell an investment if necessary. So, with rates as low as they are, I've just swept the "emergency fund" into the rest of my asset allocation now. I have a month worth of expenses on hand (earning almost nothing) because I couldn't talk myself into going without an "emergency fund" entirely.

I don't think he is just talking about an emergency fund. If you had a situation as described in the OP I'm sure all your money is not locked up in property and IRA's that is difficult to realize.

For the scenario he describes I would count mutual funds and ETF's etc that could be liquidated in a matter of days as liquid assets.

 

[HFWR]

750ml...

Everything I have is liquid, in the sense that I'm old enough to draw from my 401k if necessary. But, cash wise, I have about a years' worth of expenses.

 

[scrabbler1]

I have various tiers, or layers, of investments in my portolio. They also reflect different levels of liquidity or ease and speed of gaining direct access to them.

I keep a small cushion or surplus in my local bank's (non-interest bearing) checking account. This cushion is over the minimum balance needed to avoid monthly fees. If something arises in a given month in which I need some quick cash or to cover some small, unforeseen expense (anything under a few hundred dollars), I am just fine. This cushion also covers me in case my monthly big bond fund dividend (see my signature line) is a little lower than usual.

My next layer is a larger balance in an intermediate-term muni bond fund. While its principal can go up or down a bit, it still gives me about 3-3.5% tax-free return. I have checkwriting privileges on this account so I can use it to cover larger, unforeseen expenses or simply use a check or electronic transfer to bring funds into my local bank's checking account. I can tolerate the downside risk of this type of account (i.e. loss of principal) in return for a decent, tax-free dividend every month. This is the closest thing to my "emergency fund" which I have had even back in my working days.

My next layer consists of a stock mutual fund which I leave alone unless I really, really need to tap into it for a much larger expense (such as when I bought a new car 5 years ago). No checkwriting on this fund but I have electronic transfers available so the money is in my local bank's checking account in a few days which is fine.

After that is my TIRA which I do not expect to tap into until I am at least 59.5 years old, 10 years from now.

 

[W2R]

Enuff2eat, right now I have about 6 years' living expenses in cash, assuming that I would continue to spend as much as I am spending now.

And then, I have bond funds which some regard as the same as cash. Basically, I am not worried. I could liquidate enough to live for the rest of my life, if I was willing to sell my funds and take a tax hit.

I agree with what you are saying about net worth. My paid off house lowers my living expenses but does not add to my income.

I am 64 so access to my retirement accounts is no longer an issue for me.

 

[brewer12345]

Forget about NETWORTH. It is so misleading and sometime useless information for someone current situation.

If I have mortgage to pay and bills pilling up NOW then $0.5 million dollar of networh that sitiing in my house, my cars, my 401k, my IRA doesn't really help.

People that has $5000/mon. from retirement and has zero networth is better of than people that has $300k networth but zero cash.

enuff

Isn't it a little early to be hitting the sauce?

 

[LOL!]

I consider all my mutual funds and ETFs as LIQUID because I can sell and get cash in day or so. That means stocks, bonds, and other traded sequrities are LIQUID.

Yes, homes and perhaps if any folks have annuities with early redemption penalties, then I do not consider them LIQUID.

 

[foxfirev5]

Cash - enough for roughly 5 years , total liquid investments that I could sell on any given day- probably/maybe more than I'll need.
Not to brag but on top of that I have 11 cans of Miller Lite in the fridge.

 

[nun]

I would also define liquid as my taxable account balance. So I have roughly 7 years of expenses in there.

 

[growing_older]

I don't think he is just talking about an emergency fund. If you had a situation as described in the OP I'm sure all your money is not locked up in property and IRA's that is difficult to realize.

So, that would make about 1 month in cash. About 4 years in taxable investments that can be sold without penalty and accessed in a matter of days. Almost enough to last the rest of my life in IRAs that would require 72t paperwork or penalty to access. Plus a house I could sell (not too liquid) if I had to, but that would take more than just a few days probably.

 

[Nemo2]

Bonds & Cash Equivalents, (not including equities), about 20 years*, based on our current rate of expenditure.


*I should live so long.

 

[FIREd]

Liquid, as in anything I can sell today without penalty and have the money available in my checking account within 3 business days: 20 years worth of living expenses.

 

[Donzo]

I've got about 1 year in cash at this point. Then several years in bond funds, lifestyle fund, Wellesley, and then index funds for the long term "no touchy" money.
I will be harvesting more cash soon - I like to have at least one years worth of cash on hand (2 even) - it takes the sting out of downward trends. It's worth the loss of some potential income to sleep well and not worry for me personally.

 

[NW-Bound]

Using the 3.5%WR (that I am currently spending), what I have is the following, measured in years of living expenses. Note that we have no pension.

Cash (bank accounts/money market/I-bonds): 3 years
After-tax brokerage accounts (mostly equities): 6 years
Before-tax accounts (mostly equities, some bonds): 20 years

So, even if I get no dividend nor interest incomes, I have more than enough to live on until I get to 59-1/2, when I will be able to tap my before-tax accounts. And then later, of course I will get my grubby hand on the SS.

If push comes to shove, I will sell my houses for whatever they will fetch, which will get me many more years, then move into my RV. Of course before it gets to that, I would be reducing my expenses below where they are now, like to sell one house, cut travels, go back to work, or all of the above.

 

[NW-Bound]

OK, so let's talk about the other liquid, H2O.

So, I do not have a well with 2,500 gal tank, and only about 40 gal of fresh water. Oh wait, darn it, I already drain the tank of my motorhome. So, only a few gallons of drinking water.

Can I count my 25,000-gal pool in the back? It's loaded with chlorine and a bit salty, but still, if in a bind one cannot be choosy, right?

And then, and then, do I get to count my 50 wine bottles? OK, OK, most are under $10/each, but they quench my thirst fine.

And the stronger stuff that is 80-proof? And how about the beers my loving wife stacks for me in the utility room?

Man, I feel pretty smug.

 

[Nemo2]

OK, so let's talk about the other liquid, H2O.

So, I do not have a well with 2,500 gal tank, and only about 40 gal of fresh water. Oh wait, darn it, I already drain the tank of my motorhome. So, only a few gallons of drinking water.

Can I count my 25,000-gal pool in the back? It's loaded with chlorine and a bit salty, but still, if in a bind one cannot be choosy, right?

We live not too far from Lake Ontario.

 

[NW-Bound]

Oh man! I know I can count on people here for one-upmanship.

But, but, I thought the Great Lakes had pollution problems, no? Not like it's sour grape or anything, but I did read that somewhere. My chlorine-laden water seems so much safer.

 

[HillCountry]

Lake Austin flows by my land. So endless supply of H2O.

DW always wanted to keep at least 2.5 years of living expense in cash, and I always laughed at it. But seeing how much everybody here has readily on tap, I may agree on that.

 

[rescueme]

While I/DW are both retired and are pre-pension (she) and pre-SS (both) we jointly hold between 3-4 years of gross income (includes taxes due on pre-tax withdrawls). This is down from 4-5 years ago when I first retired, but now I/we feel comfortable with our current cash holdings. Of course, this does not include any bond holdings, which a lot of folks consider the same as cash.

As to the amount of cash? That's a much different story. In seven month's, DW's two small pensions will begin, which will reduce the amout of cash she actually holds. A year later, it will be reduced again as her SS starts and at the same time my cash will be reduced since I'll be claiming 50% of her SS.

The biggest reduction will be in just over five years, when my age 70 SS starts (assuming I live that long).

Regardless of where we are in our income streams, we will always have that 3-4 year target of cash (e.g. income) available to overcome any flux in the market. Today, it is a lot (in "volume"). After all our income sources come on-line, it will be greatly reduced.

 

[NW-Bound]

Not to brag here, but we have always had a lot of cash on hand, which is not really a good thing. Please let me explain.

From when we were 30 up to 45-year old, we were both working hard at our jobs and busy raising children too. And being LBYM'ers, we always underspent our income, though our pays were good but never that outrageous. And being a cautious guy, I did not want to put too much into the market, yet was too busy to even look into other investment opportunities.

So, while we were toiling our asses off, the money kept building up in the checking account, even though we already maxed out 401Ks, funded IRAs, etc... At the highest point, I had one year of the current living expenses in the checking account. And this was 15 or 20 years ago, when that money was worth a lot more. I cannot even tell what our expenses were back then. I simply did not know. As we LBYM'ed, there was never a need for budget! I only learn my budget recently, because I want to be at 3.5%WR.

All that money could have been invested better. If only I had paid more attention to my money than my work at the megacorp, I would do so much better now.

Anyway, my wife who has always taken care of the bills is used to seeing a lot of money sloshing around in the checking account. And now, since I have learned to move it at least to money markets or I-bonds to earn a bitty bit more, she does not get to see that cash. I keep having to assure her that I can transfer money for monthly expenses with just a click of the mouse.

I have been trying to tell my children that it is so much easier to sleep at night if one practices LBYM, but I do not know if they will follow.

 

[easysurfer]

I keep about 2 years worth of living expenses. Replenished at start of year.

 

[Dawg52]

Isn't it a little early to be hitting the sauce?

If your referring to med's, no.