How Much Cash Should I Have On Hand? Determining The Amount!

How Much Cash Should I Have On Hand? Determining The Amount!

This article on how much cash you need at hand contains Amazon affiliate links. As Amazon Associates, we earn from qualified purchases that help grow the finances of smart girls! See Disclosure for more information.

In the age of online bank accounts, credit cards, and payment apps, many find one important thing: lack of cold cash. Those who wonder, “How much cash do you need at hand?” May have a different meaning.

Some people think that “cash” has money in their checking account. Therefore, it is liquid and can be withdrawn or used for purchase at any time.

Of course, the more traditional definition of “cash” is physical money. Make currency. This is what we are mainly talking about here!

How much cash should I have, in other words, how much physical currency should I have in an easily accessible location? And how do you need to balance your cash stash goals with your organization's savings and investments? Let's see!

Why both institutional and physical savings are needed

It is very important to save in some way. Therefore, the first financial advice you hear is usually to create emergency funds. This money can afflict you with unemployment, unexpected medical events, and other emergencies (hence the name). Does “in some way” look like this? Ideally, it should be a combination! The benefits of saving with a bank account and cash are:

Benefits of saving money at the bank

You There is a compelling reason to store most of your savings in a bank (or a similar institution like a credit union). However, it is still important to answer the question, “How much cash do you need?” This will be explained later.

For one thing, banks are physically safer — your money is protected from theft, loss, natural disasters and more. Banks also have FDIC insurance. This means that if something happens and your bank goes bankrupt, Federal Deposit Insurance will refund up to $ 250,000 per customer.

Bank card, you have an electronic record of payments. Debit and credit cards usually include some purchase protection that you can't get with cash.

In addition, bank money using an interest-bearing savings account. Even if it's only 1-2 percent, this helps the savings grow slowly over time.

Benefits of holding real cash on hand

So why would you want to confuse it with cash savings, including all the benefits and protections contained in the bank?

The main advantage of having cash is when it comes to urgent scenarios. Having urgent cash funds when things go wrong can make the difference between rubbing and being comfortable. As long as the US dollar is present, cash is always worth it even in a disaster scenario.

Let's look at some of the situations where you need to think about how much cash you want to keep. hand.

How much cash do you need: Different scenarios to consider

Needs vary from person to person, so when it comes to how much cash you have, there is no single number that will help everyone. Here's how to save cash in a typical scenario:

How much cash do you need …


There are many emergency scenarios where cash is useful.

It is possible that the power will be turned off and local stores will not be able to process electronic payments.

There may be a problem with your bank or fraudster. When you access your account, you will be temporarily locked out.

Alternatively, a natural disaster or national emergency may prevent you from using your card or visiting a bank. Longer time.

When wondering how much cash you should have in an emergency, you need to consider the cost of common necessities such as:

It is always best to assume that the price will rise in an emergency, so it is wise to include a buffer. Find the right amount for what you need now and double it.

You can also start an emergency stockpile of physical merchandise to minimize what you might need to buy later.

If you lose your job

The general wisdom is to save total emergency funds at the cost of 6 months to overcome you in case of sudden loss of income. However, most of this money can be safely stored in the bank.

Under normal circumstances, if you lose your job, you will still have access to your bank account and card, so you don't need any physical cash.

When building an emergency savings fund, planning is as easy as securing a month or two of cash.

If you need secret savings

Your Needs Cash can also arise from personal emergencies such as abusive relationships or leaving family situations.

This is a scenario that many of us don't want to think about, but unfortunately many women get caught unprepared.

It's important to think about “withdrawing money” when one in three women is being abused by her intimate partner. Hidden cash can be a ticket to freedom if financial abuse is part of the big picture. Calculate the amount you would need if you had to start from scratch. You can think of it step by step:

  • Start by saving enough to save on transportation costs

    For shelters or trusted friends or relatives. Full gas tank, Uber ride, bus ticket, plane ticket, etc.

  • Then Save enough to buy your essentials If you have to leave with less luggage, such as food, health / car insurance, new phone, new clothes, etc.
  • Next, Save enough that you can afford to protect yourself . In the short term, it could be a hotel room. In the long run, it could be a security deposit for a new apartment and a rent for the first month.
  • In the long run, You can save legal costs (Especially in the case of divorce or custody battle)

    No matter how safe and stable your relationship is, it's never a pain to set it aside for you. Protect your child if you have or are pregnant.

    Just in case

    Of course There are also some non-emergency reasons to consider how much cash you have. There are still cash-only stores and restaurants!

    With cash on hand, you can voluntarily buy vegetables at the farmer's stalls or take your family to a cash-only festival. You can also save a little money by spending cash at stores that charge you for your card.

    If you're comfortable targeting a nice number of rounds, always have your first goal at least $ 100 in your wallet and $ 1,000 at home.

    Ultimately, it's helpful to have some cash for a rainy day, whether the scenario is light or complete. .. About hurricanes. The answer to “How much cash do you need at hand?” In many cases, “more than I expected!”

    When going out

    I don't know when I will need cash while I'm out. Most places these days accept debit and credit card payments, as well as apps and Apple Pay, but it's okay to prepare.

    For example, you may be in the following location: A restaurant that only accepts cash, or a restaurant that wants to easily split the invoice with friends. In such cases, it is helpful to have additional funding.

    It's important not to carry a lot of cash with you because you don't want to be the target of theft, but you need money to buy food and go home just in case. .. Depending on the situation, $ 50 to $ 100 is sufficient.

    If you have children Children

    When you have children, don't be too ready. There may be situations where cash is required. For example, if you're in a movie or museum with your child and the card doesn't work.

    You may need cash for many other reasons, but if you have a family, you may want to bring a little more money. Please hide it tightly!

    It's wise to bring at least one day with your child. $ 100 in cash. It depends on the activity of the day and where you go, but maybe more.

    Ideas for saving cash quickly

    If you don't currently have that much cash, there are some simple things you can do to get some vivid invoices in your hands!

    1. Transfer money from your savings and withdraw cash from ATMs
    2. Hold a yard sale or sell items in local apps such as Facebook Marketplace and OfferUp

    3. You can also list
    4. Start Side Hustle (eg pet seating or Instacart delivery, hints Save)

    5. With the manufacture of handmade items Sale

    6. Every time you buy groceries Choose to receive a small cashback (eg $ 20) Shop and pay with a debit card
    7. Sell firewood and garden vegetables at a self-service driveway stand (for rural areas)
    8. Recycle all aluminum cans
    9. Sell used textbooks from the university

    10. Challenge without spending Do and withdraw the amount saved in cash
    11. Please use the coupon when shopping

    Also, check out these money-making hacks to increase your savings! As long as you have a bank account and access to branches and ATMs, you can quickly turn almost any payment method into cash.

    4 safety points for storing your cash Place

    Now you know “How much cash do you need at hand?” Cash is more vulnerable to more risks than bank savings, so a secure storage plan should be a top priority. Here are some ideas on where to store your important papers!

    1. Inside a fireproof safe

    This is basically the reason why a safe exists. It's one of the best places to store cash, important documents and other valuables. A good safe will be fireproof, waterproof, and anti-theft as long as the combination or key is safe.

    Put the safe in a relatively hidden place and make a habit of never mentioning it.

    2. Buried in a waterproof container

    This idea is perfect for true “emergency” cash, as you don't want to dig up your yard every time. The power will turn off!

    To implement this idea, you need to make sure that the cash is wrapped in multiple layers to protect it from bugs and elements.

    For example, it can be placed in a sealed plastic bag, an airtight glass bottle, or a metal can. There are also some great waterproof containers you can buy. Remember where you buried it, and let a trusted family know it's there.

    3. Hidden in fake home accessories

    Want to feel even more sly with hidden cash? You can decorate your home with some fake fixtures / accessories that disguise a secret container. You can get a small vault, a fake can of corn or shaving cream, and a fake wall outlet that doubles as a fake vent or drain.

    These are less noticeable than safes, but they are usually not fireproof options. Avoid hollow books, as they are so well known that thieves may know to check your library.

    Four. Distributed in different hiding places

    Keeping all your money in one place means you can lose the full amount if something happens It means that there is sex. Distributing money to different hiding places reduces the risk of each.

    You can put your cash in a bag or hide it in your car, so you have it at hand. I have it with me while I'm out.

    Your turn: You How much cash should I have?

    It's your turn to come up with the answer for your household. At hand”! Then the next step is to reach the goal of cash savings from theory to practice.

    The best time to start saving cash is before you need it. Whether you hide it, bury it, or put it in a vault, it makes you feel better to know that money is being scraped up for a stormy day.

    Have you just started your savings journey? If you don't have any savings, check the following six steps.

Leave a Comment

Your email address will not be published.