Business Finance

How Much Cash Should I Have on Hand?

How much cash should I have on hand

It’s good to follow any strategy to save money for your future. But how much cash should I have on hand? Mostly, this depends upon two factors; how much money you should have in hand. First, what are your regular financial needs? Secondly, how often do you meet emergencies? Or do you think that any imminent emergency is there that will need a handsome amount of money? 

To learn how much one should have in his or her savings account, stay connected with us till the end of this precise guide. The later section of this short guide will break down how much you should save to handle emergencies. 

How much cash should I have on hand and emergency funds:

Everyone is sure about his or her daily expenses but no one knows how much any emergency will take. So, it’s good to keep the bad days in mind too. Most people handle their money in such a way that a handsome portion of their income goes to the savings account. Whether it comes from your 20/30/50 rule or Ramsey’s 10% rule, you should think about your emergency expenses. 

According to financial experts and advisors, it’s good to save enough money that is equal to your 6 month’s expenses. For instance, if your monthly expenses reach $2000, it’s good to have $12000 in your savings account too. 

However, some financial advisors like guru Suze Orman suggest saving enough money that’s equal to 8 months’ expenses. For an average person, it takes about 8 months to find a new job in case he loses his job. However, make sure that your money is instantly accessible to you so that you don’t need to rush to the bank in case of an emergency. You may also go without any emergency cash if you have anyone who can lend you money instantly. 

How much cash should I have on hand at home? 

To handle emergencies, you should have some money in your hand that is instantly accessible to you. You should have enough money that is enough to afford your expenses of six to eight months. 

How much should you have in savings?

The current pandemic situations of Covid-19 have left many people jobless. Due to this reason, many people have undergone financial stress. To avoid such stresses, one should have enough money in his or her savings account to face his or her emergencies. According to most financial advisors, money equal to about six months’ expenses is enough to face emergencies.

Final Verdict
It’s good to have a handsome amount of money in your hand to handle an emergency. Though it’s not sure how much money your emergency will need to get settled. So, it’s not easy to judge ‘ how much cash should I have on hand? ‘. You should have enough money that can run your home expenses until you find a new job. According to the suggestions of financial advisors, you should have enough funds in your hand that is equal to your 6 month’s expenses.

Also Read: How to transfer money from chase bank to cash app

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