Certainly, using cash as your source of liquidity can make a lot of sense, especially as part of a well-planned, diversified investment approach. Your financial professional can help you decide just how much liquidity you really need and where you might invest any surplus to help you meet your financial objectives.
When It Comes to Liquidity, Cash May Not Be King
There is also a possible downside to holding too much of your liquidity in cash. Though it may be somewhat of a safe haven in periods of turmoil, the value of cash can erode over time. That's because of inflation - a general rise in the prices of goods and services over time that can mean your money doesn't buy as much as it once did.
Investors who like the liquidity of cash, but don't want to be subject to the typical restrictions imposed by bank accounts, have some… Read More …
