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View Poll Results: Poll: % Cash in Portfolio- Read First
2% or less 37 25.69%
3%-5% 25 17.36%
6%-10% 34 23.61%
11-20% 37 25.69%
One year living expenses or other 11 7.64%
Voters: 144. You may not vote on this poll

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Old 10-20-2017, 09:29 PM   #21
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We don't take out and separate our yearly living expenses in January (or any other month). Our portfolio typically generates more than enough each month for that month's expenses plus enough to save up for the big tickets like prop tax and insurances. So far, even, we've generated enough cash income without selling and buying, i.e. Just divvies and interest, to be able to save and invest. So I don't keep a boatload of cash. For the poll, I chose 3-5%, although it creeps up from time to time. If push came to shove and there were no more income from dividends and interest, we'd push a lot of discretionary expense way down, and still be able to ride out about 2.5-3 years...maybe more. Of course, if it got that bad (say a North Korea/nuclear scenario), really, all bets are off, and I'd be bartering .22lr rounds for stuff I need...as would everyone else, as stocks, bonds and cash would be meaningless.
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Old 10-20-2017, 09:59 PM   #22
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Since a large portion of my fixed income allocation is in CDs and I-bonds (if CDs qualify as cash, savings bonds should too IMO), then I have over 25% of my portfolio in cash.
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Old 10-20-2017, 10:33 PM   #23
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I counted CDs and I-bonds... the other cash is for current spending.... so it doesn't count.
I have about 7% in cd's and I-bonds... Overall I have close to 40% bonds - but most of it is in bond funds... the i-bonds are kind of a cash slush fund.
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Old 10-20-2017, 10:52 PM   #24
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15%--I've been skimming gains into cash and bonds for the last 18 months and before that in 2015. Keeping the stock allocation at the bottom of the range; this year's gains are 4 years of minimum expenses; 3 years of regular expenses. Not looking a gift horse in the mouth, but I'd prefer to keep those gains.
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Old 10-20-2017, 11:49 PM   #25
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18% - I am keeping it high as to not be forced to sell equities during market downturns to cover our target SWR before I reach full SS retirement in about 7 years. Of course, this will be adjusted based upon my portfolio levels and if I decide to take SS early. I am going to have to withdraw money from retirement accounts to avoid massive RMDs down the road, so that will impact things as well.
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Old 10-21-2017, 02:42 AM   #26
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I only keep enough cash around for operating needs like lumpy expenses. No allocation to portfolio per se. Works out to about 2-3% of the portfolio though.

My expenses are covered by pensions and very reliable dividends.
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Old 10-21-2017, 03:33 AM   #27
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Quote:
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I only keep enough cash around for operating needs like lumpy expenses. No allocation to portfolio per se. Works out to about 2-3% of the portfolio though.

My expenses are covered by pensions and very reliable dividends.
Same here.

I did have quite a bit of cash this last couple of years in readiness for our move to England and buying a house etc. Now that is all over I keep very little cash on hand because of regular income from pensions and dividends.
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Old 10-21-2017, 06:48 AM   #28
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I selected the last option, one year living expense or other. My real cash as defined here is typically 0% increasing to as much as 2% as the end of the calendar year approaches and cash that is generated for the following year's expenses would meet the definition. But I also have another 8% in the TSP G fund which is part of my bond component but can also safely be treated as cash. That doesn't fit the definition of cash here but I view it as cash and bond.
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Old 10-21-2017, 07:57 AM   #29
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Yeah - stable value funds (no interest rate or credit sensitivity) that you can sell at any time without penalty certainly act like cash.
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percent cash
Old 10-21-2017, 08:17 AM   #30
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percent cash

I'm over 20% cash right now. Dragging my feet on investing it waiting for a correction. But I've got more than enough invested to cover our expenses if or when I need to start to withdraw, side gigs are making all we spend so far and probably will for many years. Most likely all the way until social security kicks in at 70.
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Old 10-21-2017, 08:20 AM   #31
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Nearly all the cash I have is in the cash portion of the mutual funds I own, still a little under 2%. The more discretionary cash I own, cash in my local bank's checking account, is miniscule, in the 0.1%-0.2% range. Cash comes into the account via monthly and quarterly dividends and leaves it within a month to pay the bills.
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Old 10-21-2017, 11:15 AM   #32
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+ 1 for 100% cash.
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Old 10-21-2017, 11:21 AM   #33
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I target 5%... was 6% but I reduced the target as I became more comfortable with retirement.... also I started my small pension so we do have some steady income.

If the SHTF, between the 5%, my small pension and taxable account dividends that we take in cash we could probably live a couple years without selling any investments.
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Old 10-21-2017, 11:36 AM   #34
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My cash position is about 10% but I will have an immediate need to spend a portion of it within the next 12 months. After that event, I will probably continue to hold about 3% in cash.
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Old 10-21-2017, 12:47 PM   #35
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Historically, cash has been < 5%, but currently is at 8.5% as we have been building up cash balances at current high valuations to put toward new home in middle of 2018.
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Old 10-21-2017, 02:06 PM   #36
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Originally Posted by audreyh1 View Post
Yeah - stable value funds (no interest rate or credit sensitivity) that you can sell at any time without penalty certainly act like cash.
Since my bond allocation is currently in a stable value fund, and if that counts as cash, I could answer in the 11-20%, but strictly with the guidelines of the OP, it would be less than 1%.
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Old 10-21-2017, 02:40 PM   #37
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I have a feeling your intent was to measure desired cash allocation but several responses indicate temporary conditions that have caused members to have higher than normal percentage in cash. Ten% for me but I am down around 7.
My intent was to see if our thinking was out of whack. A review with Vanguard seems to think no cash needed. Our comfort level is to have cash so that we are not stuck selling in a drastic downturn, and/or have plenty for a big emergency.

We are 6 years into retirement, cash hanging around 7%, and DH will be eligible to take early SS if desired next year, me the following year. Our cash number lets us sleep at night, and based on poll results thus far, does not seem out of whack. Always value the thoughts of this group! ( We probably will postpone SS at least a year, and we do not plan to take mine til age 70)
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Old 10-21-2017, 02:47 PM   #38
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My intent was to see if our thinking was out of whack. A review with Vanguard seems to think no cash needed. Our comfort level is to have cash so that we are not stuck selling in a drastic downturn, and/or have plenty for a big emergency.

We are 6 years into retirement, cash hanging around 7%, and DH will be eligible to take early SS if desired next year, me the following year. Our cash number lets us sleep at night, and based on poll results thus far, does not seem out of whack. Always value the thoughts of this group! ( We probably will postpone SS at least a year, and we do not plan to take mine til age 70)
Personally I believe that as long as you have enough invested in equities and bonds to support your desired long-term withdrawal rate (FIRECALC can model this) you can have as much cash as you want!

Some people prefer to keep cash low and have most funds invested in long-term assets. Others prefer to keep a lot of cash. Either is fine.
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Old 10-21-2017, 02:55 PM   #39
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Since my bond allocation is currently in a stable value fund, and if that counts as cash, I could answer in the 11-20%, but strictly with the guidelines of the OP, it would be less than 1%.
Some folks use their stable value fund as a bond substitute. If you have access to a stable value fund that pays as much interest as a short-term or intermediate-term bond fund, then using the stable value fund may make sense. You might not get the asset appreciation of a high quality bond fund when markets are stressed, but you are protected from interest rate and credit risk.
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Old 10-21-2017, 03:00 PM   #40
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By your definition, currently 6.075% (approximately).

I am almost 5 years into ER and am gradually draining the GIC ladder that I keep in my corporation. It will probably last for 3-4 more years. However, interest rates have been so low in recent times that I have not reinvested some of the proceeds of maturing GICs, but have kept them in a “high” interest savings account instead. As things stand, my “cash” allocation will continue to decrease unless I reallocate other investments.
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