quote:
One thing where a lot of financial gurus, even on this board really get it wrong is that they scoff at people who have "large" reserves of liquid cash "not working for them"

I've never seen anyone here or someone considered a "guru" recommend not having some cash stored up. Most people recommend having at least 6 months of living expenses saved up for emergencies. If you are married with kids it is probably reckless not to do this. Personally, I don't mind taking the risk of not having much in cash savings but that is only because I am young and have no one depending on me.

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Posted by cbtullis

Atlanta

Member since Apr 2004

6277 posts

Posted on 2/11/13 at 8:23 pm to Chris Farley

You should have a minimum of 3 months reserved cash before doing anything else. 6 months preferably.
You should also own disability insurance, whether its through your company or owning individually.
I can not believe how many people don't hve disability insurance. People protect their cars, homes, lives, electronics and appliances. But don't protect their income.

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Posted by foshizzle

Washington DC metro

Member since Mar 2008

40599 posts

Posted on 2/11/13 at 9:53 pm to Chris Farley

quote:
I've never seen anyone here or someone considered a "guru" recommend not having some cash stored up.

Here's one right here then.

You should have the ability to raise that much cash very quickly at little cost, yes. That doesn't mean you have to have the cash squirreled away somewhere.

For example, if you have a home equity line and need to quickly raise 5k, just write yourself a check and pay it back over the next several months. For amounts that size this should not be a big deal and no you aren't "risking your house". If you can't pay back a 5k loan to yourself at 4% interest on a schedule you set then your problem isn't the loan.

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