How much liquid cash should you have ?

[disneysteve]

A lot of people are broke all the time. I hear it even from friends. I'm like what the heck did you spend money on during this pay period. And then it comes out. We bought a nintendo switch. New ipads. Etc, etc, etc. You can't be broke making $100k+. Seriously. I hate to be mean but when they say they are struggling I'm thinking like average income $70k, but when you make double that and struggle. PLEASE.

It almost doesn't matter how much you make unless you're really at the bottom of the scale.

The other day, a coworker got pulled over because her registration was expired. She used her lunch hour to go to DMV and renew it. But when she got there (after standing in line) she learned that it was $80. She said she only has $50 in her bank account so she couldn't do it. She was waiting for payday so she would have enough money to renew and just hoped she wouldn't get stopped again.

I work with this woman. I hear her talking about things she's done and places she's gone. I see what she eats for lunch and dinner. I assure you it is her own fault that she couldn't manage to pay an $80 bill (that we all have to pay once a year).

[Gailete]

Still remember hearing my ward clerk talking to her sister and husband who came up to visit her at work one day. They were telling her that they had spend $800 on Christmas presents. This was '89-90. So how much is that worth these day? Just checked that was the same as $1500! Of all of us there at that point, I made more money than all of them. I have NEVER spent that much for Christmas! No wonder they were having money problems as they mentioned after talking about Christmas.

If you have nothing else to do with your money and all your bills are paid and you have a decent amount in savings, waste your money any way you want to. But then someone that has their financial life covered probably wouldn't want spend money recklessly anyhow.

[ndwilli6]

For me to feel secure I must have 1+ expenses saved. And, I should have easy access to the accounts. After growing up impoverished I am focused on stability. I am an aggressive saver for the most part. I shop every other year, or so. And, that's very limited. I have a car paid off now. I do have CC debt from renovating houses but thats' about it and student loans which I don't want to pay off and in fact pay very little (income based payment plan).

[ndwilli6]

A lot of people are broke all the time. I hear it even from friends. I'm like what the heck did you spend money on during this pay period. And then it comes out. We bought a nintendo switch. New ipads. Etc, etc, etc. You can't be broke making $100k+. Seriously. I hate to be mean but when they say they are struggling I'm thinking like average income $70k, but when you make double that and struggle. PLEASE.

I'm the same way. You're not sounding or thinking 'mean' you're sounding reasonable. Unfortunately many aren't focused on priorities...

If I made $100k I'd be rich. I feel great now earning my incomes and it's not close to $100k.

[Jluke]

If I made $100k I'd be rich. I feel great now earning my incomes and it's not close to $100k.

False. You would bring Home maybe 60-70k. Guess where the 30-40k goes....

[Nutria]

For me to feel secure I must have 1+ expenses saved. ... I shop every other year, or so.

Did you forget a couple of words?

[ndwilli6]

I wrote if I earned $100k I'd feel rich....of course I'll pay taxes and I'll still feel rich.

I earn $40k base salary and save very well. I have multiple sources of income and I'm still not near $100k.

If I earned $100k + my incomes I would save at least $50k annually. I guarantee it. I saved $36k in one year already.

[ndwilli6]

For me to feel secure I must have 1+ expenses saved. ... I shop every other year, or so.

No, don't read to much into it. For me to feel secure I must have at least one year worth of expenses saved. I shop intermittently.

[LivingAlmostLarge]

How do you make $40k, pay no taxes, and no expenses to live and save $40k? I mean just SS + medicare alone on the $40k is $3k so you live on $1000/year? You pay no gas, no health insurance, no groceries, no utilities?

I guess I see $1k a year spending very minimal, more than even most of the people who do FIRE. And even then people have called out people who claim to have ER on $7k/year because of living off a wife still working.

[Gailete]

A lot of people are broke all the time. I hear it even from friends. I'm like what the heck did you spend money on during this pay period. And then it comes out. We bought a nintendo switch. New ipads. Etc, etc, etc. You can't be broke making $100k+. Seriously. I hate to be mean but when they say they are struggling I'm thinking like average income $70k, but when you make double that and struggle. PLEASE.

I hear you on this. Almost as long as I have had internet access, I have participated in some sort of forum on saving, living frugally, ways to stretch money. The last couple of years have been difficult for us financially because my self-employed husband hasn't been able to work much due to physical problems. We have had to tap our credit cards much more than we would like. Assuming that our tenants pay their rent each month, our rental properties will be paid off soon which will give us more of a cash flow. I know how hard it is to live at the bottom of the barrel for income. So when I hear people saying that they have trouble living on $100K or $70K take home income, I know that they could if they wanted, make those hard decisions and do it. And I realize that in this day and age $70K take home is considered tight depending on number of kids and the area you live in.

Over the years I have heard some amazing reasons why a family in financial distress can't give up cable TV as one of the expenses almost all of them have. A big one being my husband is tired after working all day and needs to relax so he has to have cable. How about trying to some rabbit ears. Or playing board games with the kids, or reading a book, or puttering in the yard. Really, what did guys do before TV to entertain themselves when their workday was done? We have those at minimal expense and they are so cute with aluminum foil wrapped around them, but it gives us between 6-10 channels. Growing up most people, prior to cable only had THREE, the major networks and possibly PBS if they were lucky. So why does a family HAVE to have cable, or multiple cell phones? Or umpteen pets? My brother and SIL had all sorts of critters that they kept taking in. My brother worked like a dog trying to keep a roof over their heads and then having to fork out for food and vets, etc. There are so many 'little' things that families take on that they consider must haves, when in reality they are just wants that they try to justify. And so the expenses keep going up and they are all these MUST situations. Private schools, after school activities for the kids, etc. all cost money and all get justified as to why they can't/won't give them up.

Growing up, I knew we were poor. We all knew that. When activities came up we didn't ask about doing them. We knew it was out of the question. It does not kill a child to understand the limitations of the household income. It should help inspire those same kids to make more to have more.

[ndwilli6]

It seems like you're only using my full-time employment. I earn more than just that. I have two part time jobs and I am a licensed RE agent as well. I pay taxes (federal & state). Gas. Insurance. Utilities. You name it. Long story short I save my entire salary. I can give you a full break via email.

[prsantbhatt]

I carry less than 1000$

I only carry less than 1000$ on my pocket

[TexasHusker]

This is a great topic! I keep VERY LITTLE cash on hand, because if I have it on hand, I SPEND IT! So...I tie it up. In real estate mainly. Or if I gather a decent chunk of money, I'll open up another franchise. It's like a forced savings to me really. I've just never been too good about having a bunch of cash lying around in an account somewhere.

There are times when I have a cash flow issue arise, but that's what a good banker is for.

[LivingAlmostLarge]

Too much still. But right now we are still in limbo about what to invest in. And we have to decide if we are going to pay off my car and if we are going to invest in 529 or something ourselves.