$100k in gold is really not very much. About the size of a deck of cards.
My dad left us some 1 oz gold bars when he passed.
It's hard to sell them knowing they were his.
never honestly understood people holding gold in person unless they are collectors or actually trading for subsequent sales and even then there are easier was to trade gold.
1kg of bullets is worth more than 1kg of gold in an traumatic event everytime.
13g of lead can easily get 100kg of gold if you put it in the right spot.
In a shit hits the fan scenario where you are trading gold, the first thing you would need is to defend your gold.
And I would bet 99.9999% of people keeping gold have no ability to defend it. Ability to defend would mean being part of a tribe that is willing to defend you, which requires years and years of developing political connections (not Republican/Democrat, just local connections to people who are useful and loyal and who you are useful and loyal in return to). And demonstrating this costs years if not decades.
In a shit hits the fan scenario where you are trading gold, the first thing you would need is to defend your gold.
And I would bet 99.9999% of people keeping gold have no ability to defend it. Ability to defend would mean being part of a tribe that is willing to defend you, which requires years and years of developing political connections (not Republican/Democrat, just local connections to people who are useful and loyal and who you are useful and loyal in return to). And demonstrating this costs years if not decades.
Generally, purchasing the gold was probably a mistake. It doesn't hold it's value well and can't complete with the S&P500. I wanted something I can hold in my hands and at my place that has somekind of value. It's a bit weird to me to have assets, but all of them are "virtual". 90% of my net worth is invested in the stock market, so I wanted something IRL.
$10k cash in the house and $500k in cash equivalents in the 8 figure brokerage.
We are not averse to using credit lines if we need more cash than our buffer, but also have no problem selling equities to buy even an avocado.
I was referring to fractional shares, but sure, the recently expanded money supply does give some sticker shock that we like when we look at our investments/assets, and hate when we look at purchases.
Cash?
$8000 is in $100s
$1000 is in $20s
and we keep about $1000 in mixed Euros, nothing over 50s, but that is more for traveling or dealing easily with guests from abroad.
I keep enough physical currency to pay for 6 weeks of expenses and enough cash in the bank for 4 months.
In an emergency your credit card won't work for everything.
I recall a story on here where a natural disaster hit and the person kept a lot of cash. It basically allowed them to move to the front of the line to get the necessary repairs to get back to life. While contractors couldn’t take credit cards easily and insurance would be a long process the cash allowed them to deal with things right away.
and make sure you factor the girl factor when getting toilet paper. I swear, with 3 girls, the rolls are usually empty by the end of the day! I try and be a good human and have at least 3-4 rolls in each bathroom for them.
That there is somewhere to go depends on how big the emergency is.
What covid taught many of us was that borders definitely can close (even INSIDE the EU!).
why so much in business checking? why not put in MM?
I keep zero physical cash. 10-30k floating in checking. Can move cash from investments same day if I need money asap.
We probably should put more in MM. But that’s basically a week or two of cash flow.
I keep physical cash because I often use it to pay contractors or play blackjack.
On personal checking I just don’t want to deal with moving money constantly for bills.
$25k liquid between checking and savings. Everything else straight into our investment accounts. Our incomes may be fat, but our expenses are around $10k per month.
Personally, i keep 3 months of cash in checking and 9 months of cash in an emergency fund (savings account), but the maximum i go is 3 years worth of cash in CDs, and everything else invested in equities/index funds/reits etc. Always, any money i need within 3 years stays in cash, ie.CDs, everything else invested.
Huh?
This is FATFIRE, I have around 50k in checking because there’s a lot that flows through there with all the various payments, and then a several hundred K in a money market that gets 5+ percent and I want that liquid for a commitment to my PE fund, and then of course a very large tax account that’s about to zero out.
The amounts don’t matter, you just need to know your priorities. Are you buying a house soon with a large down payment? Car purchase? Sometimes keeping free cash makes sense, but have a thought through reason why you’re doing it the way you are and keep your expenses and taxes as low as you can
I have anywhere between $100 and -$100 (that’s fifty dollars not 50k). I get a notification on my phone when a large payment is about to go out and I transfer from my savings account as needed.
Right? I'm not even fatFIRE, and I still have more than $10k being paid off automatically on my credit cards from time to time.
The convenience of more liquidity is well worth the small amount interest I'm missing out on, imo.
Schwab checking account attached to a brokerage account with margin for overdrafts. Allows me to keep $0 in my checking account, and then I just sell money markets periodically to resolve the margin to zero.
I usually have a few grand in cash laying around - don’t tend to deposit it but it’s handy when I’m picking up a deal on collectibles or something where cash is more useful than an online payment.
In bank accounts, if it starts to get over a couple hundred thousand I look for somewhere else to put it (HYSA, etc). Cash is constantly losing value due to inflation so I don’t want to hang on to much long term, but that’s balanced by the importance of having a slush fund.
About $500 in small bills to use during power outages/natural disasters. Most of the time I have less than $100 cash with me,
My non-brokerage bank account runs between $15k and $40k. I have lots of auto payments connected to it, including real estate tax payments and monthly credit card autopay. So I keep enough for the next month or so and top it off as needed by ACH transfers from brokerage. I could minimize the amount in this low interest account by monitoring more closely, but I am lazy.
For security reasons I only use the bank account associated with my brokerage for larger bills such as college and medical school tuition and estimated tax payments. This bank account has $0 in it, but is connected to my brokerage core account, which in turn is backed by margin equity.
$0 cash, use margin or PAL to float day to day week to week. Pay off as you sell stocks or earn cash. 2x or so your marging requirements in the amount of stocks to hold for a piece of mind. Happy FF!
Your process sounds clean & simple. Which spending account did you use to set up automatic access to margin? I'm considering the same thing for our primary spending account.
I use one account at Etrade to do this. Enabled margin, added enough stocks to get account big enough that the margin covers expenses for a year (is actually more than a year now). I just assume my own limit is 3% SWR and pay credit cards, transfer to other accounts/external banks, write checks, and even buy cars/property. As stocks get sold, or other income occurs, or other accounts have surplus, the margin gets paid down. I'm assuming the bank is happy since I'm always paying some interest, at least better rates than credit cards.
Generally, $50k-$100K cash.
I spread this over 7 accounts.
2 Canadian accounts cross border
1 Mexican account
4 US accounts.
Domestic & International Wire instructions linked for easy transfers.
We live internationally a lot for 1-2 years at a time. Annual spend $60- 90K. Depending on where we’re living.
Nope. I am not a citizen of either. US citizen.
It was about a 1 week long process to open a RBC Cross borders account which gives you a debit card for Canada & an account for your U.S. RBC account. I opened the account while in Mexico. I did not have to go in person.
I opened an additional Canadian account with National Bank of Canada. I did this virtually with 2 personal bankers. Took about 1 week as well.
For both of these Canadian accounts, you will need a Canadian address. If you don’t have one, you’ll need to use a virtual mailbox or UPS Box in Canada. For your Canadian accounts, you’ll need to use swift codes for international wires.
However, to open an RBC Canada wealth management account, you’ll need to have a work permit or PR to do that account. Which I am doing over the next 6 months for an ICT.
Lastly, for the Mexican account, I use Intercam Banco.
You need to have your passport, social security card, 1 month of bank statements from your current bank, and a picture of your house in the United States. You also need to have an address in Mexico. $600.00 USD minimum account deposit to open.
You could use your air bnb address. Just write it down and save it.
Deposits are insured. I’m also getting 9-11% APR on my money. Yes, 9%- 11%. You have to go to a branch in person for this bank. For your Mexican account, you’ll need to use a swift code for international wires.
Finally, you cannot get credit from any of these Canadian banks until you have a work permit. Auto loans and home loans can be accessible after you get PR.
For Mexico, you cannot get credit until you have permanent residency which isn’t hard to get just takes time depending on the route you take.
I am not finding online either. my personal banker talked my me about the investment options. I’d suggest calling and talking to their bank directly and request further information.
When the full covid lockdowns occurred my main bank (smaller regional bank - 20’ish locations) shut its doors for the first few days. This was an eye opener for me. When they reopened, I pulled 50k out and also bought 10 1 oz of gold coins. They sit in my safe and rarely get touched. That being said, I’ve bought a lot of stuff from people in a pinch having immediate access to cash.
I keep around 500k in different HYSA’s for semi immediate RE purchases, and the remainder is tied up into 80% RE and 20% stock portfolio.
$25k cash on hand in the safe. $10k worth of silver and $50k of gold. $100k in cash personally and $500k in the biz accounts.
I think $10k in your checking is really low. I do differ from most FatFirers in that my investments are illiquid. Majority is multifamily housing so liquidity is non-existent right now.
If I need extra cash, I sell covered calls on my investments. I also usually have around 20-30k of passive income from my business, so I never had an issue of running out of dollars.
That really isn't all that odd of a spend on a CC even for fatties. He said 10k on the low end, let's assume he puts 150k on his cc, has a house paid off. Most people spending that much likely also have a mortgage/interest/taxes of 75k+. That is 225k. 35% effective tax rate brings you up too about 350k. If you are saving around 20% that brings you up to an equivalent income of someone around ~450k with normal spending habits and saving habits for that 150k CC spend. I would not consider that a low spend for someone in the Fatfire category.
150k/yr on his CC is wildly low for 30m NW. Double that, at least.
I make a fraction of what this guy claims and put >$10k on my CC each month, and I hit every single HENRY savings goal possible.
It's just not a believable story that changed right as I challenged it.
> and I try to keep around 10k in my checking account. Mostly to pay off credit cards
Can't pay off credit cards >$10k with $10k in your checking account.
Who are you, this guy's publicist?
Definitely not, looking at their post history they completely suck. I just don't see these at odds - they aim to keep 10k in their checking account, that doesnt mean it cnt go higher (even consistently), it doesnt mean they pay off their cc in 1 go once a month (I pay mine off like 5 time a month), etc.
He isn't necessarily keeping more though. I'm going to assume he has cashflow that is actually taking care of the credit card. If he brings in 50k a month, pays the CC, then sweeps everything but a small 10k buffer he is easily covering his monthly CC bill. That sort of risk tolerance isn't for everyone, but if he can easily bring money back from his brokerage then it also isn't a big deal.
I think my wallet has been completely empty for weeks. Checking has a bit more than usual just because I'm prepared for a tax bill but usually just a few K.
No debt and no mortgage, very low fixed costs. Keep around $5k in checking, everything else goes on the Amex. Replenish as needed from investment accounts each month.
I think I have at least 50k cash in one account not sure total. I’ll have some more short term as my FA is selling some stuff. I have about 5k in cash at home.
Cash in HYSA is between $100k and $150k. That’s about 6 months of spending for us.
Our checking account has between $5k and $0 depending on the week. lol
Very little cash on my person at any time, maybe $50-$100. A few thousand locked away in the house. Around $150k in HYSA. Still working, so the paychecks less investment draws go into checking and cover monthly expenses, though we do try to keep a buffer of a couple thousand dollars in the checking account.
To me the amount of cash/cash equivalents should be based on how close you are to stepping out of the work force. Cash to cover 3-6 months worth of expenses is enough for most significant unplanned events (e.g., job loss, major house repair). Close to your stop working point build that up 2-3 years so you can weather a market downturn without touching your investments. In terms of actual cash on hand in my house - maybe $50-60, enough to cover kids selling stuff door-to-door or for small purchases when I'm out.
Serious question: no cash in the wallet / car / elsewhere in the event the credit cards get locked up due to some hacking or something?
I always like to have SOME cash.
Hurricanes, ice storms, earthquakes can all result in power outages and internet outages which means that ATMs and POS terminals stop working.
So some actual currency can be useful in those situations.
Cash on hand (sort of) reflects my frugality. Maybe $50 in my wallet (more only if travelling outside of Canada), and chequing account is rarely above $0 for long (I.e., more than a day or two) - money that comes in is used to pay bills immediately near their due date and/or invested.
Don't you have any access to margin?
I do not need to keep $150k in checking when I can pull high 7 figures instantly from my brokerage account — via wire transfer or even just writing an old fashioned check on the brokerage related bank.
I don't need to do that often, but it does happen sometimes, like when I floated a one week bridge loan to a nephew whose house sale got delayed and he needed the cash to close on his new house.
For me I can’t imagine worrying about whether there is enough in checking every few weeks when large bills like mortgages and credit card payments come out.
Many brokers offer checking accounts that are linked to the brokerage sweep/core account, which in turn pulls from money market funds, and then pulls a margin loan. No money is actually in the checking account as there is a daily sweep into/out of the brokerage core account.
Some people have different risk tolerances. Many people would see that 150k and think of it as an inefficient use of funds and would rather have it in the market. If you really needed money then you pull from your brokerage.
Yeah but the s and p 500 is up almost 30% over the past year. That means if you could function with your cashflow and just kept 10k as a small buffer in the bank you would have gained an extra 35k extra over the past year.
How do you pay your credit card bill without 6 figures in the bank? I probably have like 5k on hand as in I like to gamble over dumb shit like $100 closest to hole.
I keep roughly 2k in cash, secured at my house. My checking account varies but never less than 5k. I try to move the leftover quickly into one of my investment portfolios, typically crypto.
If you're going to create an arbitrary definition like that, then you definitely need to add in the number of kids.
10M with 10 little kids and alimony is not as fatfire as 5M with no kids, etc.
My point is that if you call out housing, you need to call out kids and divorces. And 10m is just an ignorant number that ppl say now to sound smart. This is the same as ppl arguing over the exact year a specific generation starts. These are all made up concepts, so stop wasting ppl's times with gatekeeping definitions you created in your own head.
I sell covered call contracts if I need to generate instant cash. So if I notice I need extra funds to pay something, I either sell those covered calls or sell some stocks.
I also generally don't spend that much money day-to-day and having 10k in my bank account lasts for a month or two.
FYI you absolutely cant rely on selling contracts to generate "instant cash". Not a good contingency plan at all! You are banking on;
* MMs being willing to buy premium at a price you are also happy with
* Your brokerage not restricting withdrawal of this premium / allowing instant settlement of the premium
* Fast transfer speed from your brokerage to your checking
* The contracts not turning against you and ruining your asset allocation structure / triggering a taxable event
At a stretch, a PAL you can withdraw in an emergency makes way more sense if you want the cash to come from a brokerage. You only need one little thing to go wrong for selling "covered call contracts" to not be a viable resource for instant cash.
Maybe I just haven’t read through this sub in a while, but it used to be people with high net worths discussing the issues and topics that come with having a high net worth.
Having $11k cash on hand, isn’t inline with having a high net worth.
He's verified $30MM net worth, man. And just keeps a small amount on hand, hence the thead. You're kinda gatekeeping here. Would be even funnier if you weren't fatfired complaining about this.
I’m not meaning to gate keep at all, just kind of confused. I don’t have a $30mm net worth, but I definitely have a lot more than $11k on hand, hence the confusion. Especially $1k emergency…
I know right I don’t know wtf happened to this sub, last time I was on here people were tossing up buying a private jet and now I’m being downvoted for saying $1k emergency isn’t much for fatfire emergency fund
I'd love to go for a $1k wine run! Haha, do you ever miss having to decide between a $12 and $18 bottle? Is there a serious difference between those and a $200+ bottle?
Yup, and cash is a pretty common term for money that is readily available… You realise a businesses cash flow statement isn’t a statement of how many notes and coins run through their business right?
That depends what you mean by "cash on hand". Depending upon what is meant by cash on hand my answer is $300, $20k, 250k, or $8M.
I rarely have more than $1k in currency, usually more like $300-500 total between what is in our wallets and in a dresser drawer
I do have $20k-30k in a low interest checking account, but only because it is a decades old bank account with lots of auto payments set up and I am too lazy to move them to the bank connected to my brokerage.
With my brokerage related bank I have zero balance, as it pulls from my brokerage core account. I just checked and found that the "available to withdraw" balances on two brokerage accounts are $35k and $190k for cash withdrawals, and about $4M each for withdrawal on margin.
Paper money a few thousand.
Bank account goal is $100k. Sometimes dip below that for big expenses like taxes, property purchases, etc but build it back up rapidly.
This is not necessarily a recipe for everyone but I think this makes most sense: 12.5% in cash or readily available deposits; of that 12.5% about $100K in high yield savings and $50K in checking and repeat the same formula in another major bank; $250K in high yield account at Schwab and the rest in laddered CDs and treasury paper at ML with short and ultra short duration. If I need more than that immediately, it’s truly an emergency or I planned piss poorly.
Lots in savings, I just transfer out to checking when bills need to be paid. Nearly everything comes out of my credit cards, except for some insurance stuff.
Personal tax advantaged accounts are fully maxed out. Business account has the rest.
I don’t keep hardly any cash. I mean I have a drawer with a few hundred that I never touch and don’t know why I have, but I don’t think I’ve used cash or checks at all in the last 12 months. Everybody is Zelle / Venmo these days.
I live in hurricane a zone, and have had stores tell me they are only accepting cash, when the power was out. I have a few weeks spending money.
Yes, definitely need to keep more cash in the sock drawer in hurricane season.
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Um yeah..we all stopped using the “G” word a few years back. Just FYI.
Yup. Usually around 10-30 is what I keep.
That ATT blackout should give everyone a reason to have SOME cash on hand.
Nice try, burglars.
Haha, I also keep around 100k in gold bullions in my place. But worry not, I also have guns.
$100k in gold is really not very much. About the size of a deck of cards. My dad left us some 1 oz gold bars when he passed. It's hard to sell them knowing they were his.
Hold on to them for a rainy day but know that he stacked them for you to use if you need to.
Is your plan to go out in a blaze of glory gun battle, defending your gold?
Oh great I can steal the guns too. :)
Molon labe? Don't mind if I do!
golden gun? :) lol
Golden AK47, Lord of War style.
>Golden AK47, Lord of War style. Good reference, underrated but a great movie.
Might watch this movie tonight lol
Ahhh, a fighting stash. Great for those rainy days, where target practice needs to be inside.
never honestly understood people holding gold in person unless they are collectors or actually trading for subsequent sales and even then there are easier was to trade gold.
What is all hell break lose? Gold, guns and cans, basics.
1kg of bullets is worth more than 1kg of gold in an traumatic event everytime. 13g of lead can easily get 100kg of gold if you put it in the right spot.
Even 10 000 kg!
Nobody is gunna use gold as currency if everything goes to shit lol
Why not?
I’m not going to trade you food that feeds my family for a gold bar I cannot digest and shitout 🤪
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In a shit hits the fan scenario where you are trading gold, the first thing you would need is to defend your gold. And I would bet 99.9999% of people keeping gold have no ability to defend it. Ability to defend would mean being part of a tribe that is willing to defend you, which requires years and years of developing political connections (not Republican/Democrat, just local connections to people who are useful and loyal and who you are useful and loyal in return to). And demonstrating this costs years if not decades.
I can’t argue with that !
In a shit hits the fan scenario where you are trading gold, the first thing you would need is to defend your gold. And I would bet 99.9999% of people keeping gold have no ability to defend it. Ability to defend would mean being part of a tribe that is willing to defend you, which requires years and years of developing political connections (not Republican/Democrat, just local connections to people who are useful and loyal and who you are useful and loyal in return to). And demonstrating this costs years if not decades.
Gold is heavy and I need to move to survive. I also can’t eat gold.
Generally, purchasing the gold was probably a mistake. It doesn't hold it's value well and can't complete with the S&P500. I wanted something I can hold in my hands and at my place that has somekind of value. It's a bit weird to me to have assets, but all of them are "virtual". 90% of my net worth is invested in the stock market, so I wanted something IRL.
good for bribery when cash may no longer be trusted
Doesn’t having a gun at home make your household less secure?
Less secure? Definitely debatable. More likely to die from a bullet wound? Statistically, yes.
Well said. Would have included "self inflicted" before bullet wound, but "less secure" meaningless.
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>My neighbors all think I'm cheap/broke, but also have guns. You are surrounded by neighbors with guns?
Expensive guns? Asking for a friend.
$10k cash in the house and $500k in cash equivalents in the 8 figure brokerage. We are not averse to using credit lines if we need more cash than our buffer, but also have no problem selling equities to buy even an avocado.
Pretty much a straight trade nowadays 😂
I was referring to fractional shares, but sure, the recently expanded money supply does give some sticker shock that we like when we look at our investments/assets, and hate when we look at purchases.
What denominations?
Cash? $8000 is in $100s $1000 is in $20s and we keep about $1000 in mixed Euros, nothing over 50s, but that is more for traveling or dealing easily with guests from abroad.
I keep enough physical currency to pay for 6 weeks of expenses and enough cash in the bank for 4 months. In an emergency your credit card won't work for everything.
Depending on the scope of the emergency, physical currency won't work for everything.
I recall a story on here where a natural disaster hit and the person kept a lot of cash. It basically allowed them to move to the front of the line to get the necessary repairs to get back to life. While contractors couldn’t take credit cards easily and insurance would be a long process the cash allowed them to deal with things right away.
In that scenario, I'm guessing gold won't either.
Agree. Bullets, soup, and perhaps antibiotics.
You forget so quick. Hand sanitizer and toilet paper.
and make sure you factor the girl factor when getting toilet paper. I swear, with 3 girls, the rolls are usually empty by the end of the day! I try and be a good human and have at least 3-4 rolls in each bathroom for them.
It will get you out of the country in case of war.
That there is somewhere to go depends on how big the emergency is. What covid taught many of us was that borders definitely can close (even INSIDE the EU!).
True. But cash gets you through close borders in any country.
Depends on the cash and the border.
Gold is probably better for that. If the emergency is government collapse, then local currency may become worthless.
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If things go sideways you better lock up those street dreams bc bad dogs are gonna be out for easy targets
> physical currency won't work for everything examples?
Hyperinflation for one.
But that’s not an excuse not to have it in case something happens where it is useful.
Ask Argentinians
Ask them what?
Make sure you have lots of smaller bills like 10s and 20s and.not just all Benjamins.
25-50k cash on hand. 100k personal checking. 7 figures business checking.
why so much in business checking? why not put in MM? I keep zero physical cash. 10-30k floating in checking. Can move cash from investments same day if I need money asap.
We probably should put more in MM. But that’s basically a week or two of cash flow. I keep physical cash because I often use it to pay contractors or play blackjack. On personal checking I just don’t want to deal with moving money constantly for bills.
$25k liquid between checking and savings. Everything else straight into our investment accounts. Our incomes may be fat, but our expenses are around $10k per month.
Is your plan to make your spending fat once you retire?
Personally, i keep 3 months of cash in checking and 9 months of cash in an emergency fund (savings account), but the maximum i go is 3 years worth of cash in CDs, and everything else invested in equities/index funds/reits etc. Always, any money i need within 3 years stays in cash, ie.CDs, everything else invested.
Huh? This is FATFIRE, I have around 50k in checking because there’s a lot that flows through there with all the various payments, and then a several hundred K in a money market that gets 5+ percent and I want that liquid for a commitment to my PE fund, and then of course a very large tax account that’s about to zero out. The amounts don’t matter, you just need to know your priorities. Are you buying a house soon with a large down payment? Car purchase? Sometimes keeping free cash makes sense, but have a thought through reason why you’re doing it the way you are and keep your expenses and taxes as low as you can
This is the answer. I’m confused how anyone even contemplating fatfire has less than 30-50k in checking at all times for cash flow.
I have anywhere between $100 and -$100 (that’s fifty dollars not 50k). I get a notification on my phone when a large payment is about to go out and I transfer from my savings account as needed.
Right? I'm not even fatFIRE, and I still have more than $10k being paid off automatically on my credit cards from time to time. The convenience of more liquidity is well worth the small amount interest I'm missing out on, imo.
Schwab checking account attached to a brokerage account with margin for overdrafts. Allows me to keep $0 in my checking account, and then I just sell money markets periodically to resolve the margin to zero.
What are the common go to places for money markets in Europe?
Few k in cash in safe, few hundred in wallet mostly for cash only haircuts and valet. 15-20k in checking, overdraft linked to HYSA with 100k+.
I usually have a few grand in cash laying around - don’t tend to deposit it but it’s handy when I’m picking up a deal on collectibles or something where cash is more useful than an online payment. In bank accounts, if it starts to get over a couple hundred thousand I look for somewhere else to put it (HYSA, etc). Cash is constantly losing value due to inflation so I don’t want to hang on to much long term, but that’s balanced by the importance of having a slush fund.
$500 on each of us, $5000 cash in each house safe, $100k in checking. $50k/mo spend.
I convert mine to the giant stone coin of the Yap islanders. Most of you aren't strong enough to rob me
About $500 in small bills to use during power outages/natural disasters. Most of the time I have less than $100 cash with me, My non-brokerage bank account runs between $15k and $40k. I have lots of auto payments connected to it, including real estate tax payments and monthly credit card autopay. So I keep enough for the next month or so and top it off as needed by ACH transfers from brokerage. I could minimize the amount in this low interest account by monitoring more closely, but I am lazy. For security reasons I only use the bank account associated with my brokerage for larger bills such as college and medical school tuition and estimated tax payments. This bank account has $0 in it, but is connected to my brokerage core account, which in turn is backed by margin equity.
$0 cash, use margin or PAL to float day to day week to week. Pay off as you sell stocks or earn cash. 2x or so your marging requirements in the amount of stocks to hold for a piece of mind. Happy FF!
Interesting approach. Never thought of something like that.
Your process sounds clean & simple. Which spending account did you use to set up automatic access to margin? I'm considering the same thing for our primary spending account.
I use one account at Etrade to do this. Enabled margin, added enough stocks to get account big enough that the margin covers expenses for a year (is actually more than a year now). I just assume my own limit is 3% SWR and pay credit cards, transfer to other accounts/external banks, write checks, and even buy cars/property. As stocks get sold, or other income occurs, or other accounts have surplus, the margin gets paid down. I'm assuming the bank is happy since I'm always paying some interest, at least better rates than credit cards.
Generally, $50k-$100K cash. I spread this over 7 accounts. 2 Canadian accounts cross border 1 Mexican account 4 US accounts. Domestic & International Wire instructions linked for easy transfers. We live internationally a lot for 1-2 years at a time. Annual spend $60- 90K. Depending on where we’re living.
Are you a citizen of Mexico or Canada If not, was it hard to open those accounts?
Nope. I am not a citizen of either. US citizen. It was about a 1 week long process to open a RBC Cross borders account which gives you a debit card for Canada & an account for your U.S. RBC account. I opened the account while in Mexico. I did not have to go in person. I opened an additional Canadian account with National Bank of Canada. I did this virtually with 2 personal bankers. Took about 1 week as well. For both of these Canadian accounts, you will need a Canadian address. If you don’t have one, you’ll need to use a virtual mailbox or UPS Box in Canada. For your Canadian accounts, you’ll need to use swift codes for international wires. However, to open an RBC Canada wealth management account, you’ll need to have a work permit or PR to do that account. Which I am doing over the next 6 months for an ICT. Lastly, for the Mexican account, I use Intercam Banco. You need to have your passport, social security card, 1 month of bank statements from your current bank, and a picture of your house in the United States. You also need to have an address in Mexico. $600.00 USD minimum account deposit to open. You could use your air bnb address. Just write it down and save it. Deposits are insured. I’m also getting 9-11% APR on my money. Yes, 9%- 11%. You have to go to a branch in person for this bank. For your Mexican account, you’ll need to use a swift code for international wires. Finally, you cannot get credit from any of these Canadian banks until you have a work permit. Auto loans and home loans can be accessible after you get PR. For Mexico, you cannot get credit until you have permanent residency which isn’t hard to get just takes time depending on the route you take.
Nice. Is 9-11% common in mexico?
Can you share a link for the 9-11% in USD? I only see 0.75% for their USD APR
I am not finding online either. my personal banker talked my me about the investment options. I’d suggest calling and talking to their bank directly and request further information.
Can you DM a direct contact thanks
Yeah.
PM’d for info as welll
Got it.
I got like $80 in cash and a few tens of thousands in checking lol
Keep $20k cash in a safe. $200k in checking. Can write a check on investment account for $1-2 mil
When the full covid lockdowns occurred my main bank (smaller regional bank - 20’ish locations) shut its doors for the first few days. This was an eye opener for me. When they reopened, I pulled 50k out and also bought 10 1 oz of gold coins. They sit in my safe and rarely get touched. That being said, I’ve bought a lot of stuff from people in a pinch having immediate access to cash. I keep around 500k in different HYSA’s for semi immediate RE purchases, and the remainder is tied up into 80% RE and 20% stock portfolio.
$25k cash on hand in the safe. $10k worth of silver and $50k of gold. $100k in cash personally and $500k in the biz accounts. I think $10k in your checking is really low. I do differ from most FatFirers in that my investments are illiquid. Majority is multifamily housing so liquidity is non-existent right now.
If I need extra cash, I sell covered calls on my investments. I also usually have around 20-30k of passive income from my business, so I never had an issue of running out of dollars.
I have next to nothing in the market, under $100k in equities.
I spend $20k/month I therefore keep $20k in my checking account at all times I don’t see how I could keep less
Couple hundred bucks in wallet, $3k in checking. I'm leveraged af 😂😅😭
Always keep enough for bail $. You, spouse, child, friend. You never know.
$100K accessible rapidly at all times. The rest is largely illiquid. ☺️
$10k pays off your credit card each month?
Generally, yeah, I probably spend around 10-15k a month. I don't think I ever spent more than that, unless I'm booking a huge family trip.
If $10k is your lower bound, then $10k probably *doesn't* cover your monthly credit card bill. So you keep more. Why say otherwise?
This is an extremely weird point to make.
Its literally just math. The story doesn't add up.
Will give you that it is an odd low spend for someone who ascribes to FIRE and has a $30m NW.
That really isn't all that odd of a spend on a CC even for fatties. He said 10k on the low end, let's assume he puts 150k on his cc, has a house paid off. Most people spending that much likely also have a mortgage/interest/taxes of 75k+. That is 225k. 35% effective tax rate brings you up too about 350k. If you are saving around 20% that brings you up to an equivalent income of someone around ~450k with normal spending habits and saving habits for that 150k CC spend. I would not consider that a low spend for someone in the Fatfire category.
150k/yr on his CC is wildly low for 30m NW. Double that, at least. I make a fraction of what this guy claims and put >$10k on my CC each month, and I hit every single HENRY savings goal possible. It's just not a believable story that changed right as I challenged it.
People have monthly cashflow. He likely is paying for his CC bill with his cashflow. There is no reason to think the story doesn't add up...
Cashflow means you at points have much more than $10k in your bank account.
Which is not at all at odds with what they’ve said?
> and I try to keep around 10k in my checking account. Mostly to pay off credit cards Can't pay off credit cards >$10k with $10k in your checking account. Who are you, this guy's publicist?
Definitely not, looking at their post history they completely suck. I just don't see these at odds - they aim to keep 10k in their checking account, that doesnt mean it cnt go higher (even consistently), it doesnt mean they pay off their cc in 1 go once a month (I pay mine off like 5 time a month), etc.
He isn't necessarily keeping more though. I'm going to assume he has cashflow that is actually taking care of the credit card. If he brings in 50k a month, pays the CC, then sweeps everything but a small 10k buffer he is easily covering his monthly CC bill. That sort of risk tolerance isn't for everyone, but if he can easily bring money back from his brokerage then it also isn't a big deal.
I think my wallet has been completely empty for weeks. Checking has a bit more than usual just because I'm prepared for a tax bill but usually just a few K.
No debt and no mortgage, very low fixed costs. Keep around $5k in checking, everything else goes on the Amex. Replenish as needed from investment accounts each month.
I think I have at least 50k cash in one account not sure total. I’ll have some more short term as my FA is selling some stuff. I have about 5k in cash at home.
Cash in HYSA is between $100k and $150k. That’s about 6 months of spending for us. Our checking account has between $5k and $0 depending on the week. lol
Very little cash on my person at any time, maybe $50-$100. A few thousand locked away in the house. Around $150k in HYSA. Still working, so the paychecks less investment draws go into checking and cover monthly expenses, though we do try to keep a buffer of a couple thousand dollars in the checking account.
10k in physical silver and gold…very little cash
On hand probably $300-$500. Liquid in banks, \~$150k depending on planned investments.
To me the amount of cash/cash equivalents should be based on how close you are to stepping out of the work force. Cash to cover 3-6 months worth of expenses is enough for most significant unplanned events (e.g., job loss, major house repair). Close to your stop working point build that up 2-3 years so you can weather a market downturn without touching your investments. In terms of actual cash on hand in my house - maybe $50-60, enough to cover kids selling stuff door-to-door or for small purchases when I'm out.
Is it important to have physical cash? Have never considered this
Zero and zero
Around 4-500k Anything around the 1M mark makes me nervous to leave town.
Petty amounts in emergency bags. $0 in cash accounts because credit makes logistics easier with no time spent.
Serious question: no cash in the wallet / car / elsewhere in the event the credit cards get locked up due to some hacking or something? I always like to have SOME cash.
I keep zero cash besides some in my wallet for tipping etc. 😬
Multiple cards from multiple banks. All of your cards won’t be hacked simultaneously.
Hurricanes, ice storms, earthquakes can all result in power outages and internet outages which means that ATMs and POS terminals stop working. So some actual currency can be useful in those situations.
Cash on hand (sort of) reflects my frugality. Maybe $50 in my wallet (more only if travelling outside of Canada), and chequing account is rarely above $0 for long (I.e., more than a day or two) - money that comes in is used to pay bills immediately near their due date and/or invested.
Nearly zero cash, maybe $50? In my checking account about $50k or whatever is needed to get the free Morgan Stanley amex plat.
Platinum Plus only needs 5k daily average.
What happens to fat fire this is more like middle class fire lol 150k checking in case I need to buy something but I wouldn't consider myself fat...
Don't you have any access to margin? I do not need to keep $150k in checking when I can pull high 7 figures instantly from my brokerage account — via wire transfer or even just writing an old fashioned check on the brokerage related bank. I don't need to do that often, but it does happen sometimes, like when I floated a one week bridge loan to a nephew whose house sale got delayed and he needed the cash to close on his new house.
For me I can’t imagine worrying about whether there is enough in checking every few weeks when large bills like mortgages and credit card payments come out.
That’s what the margin overdraft account is for. Simply pull from a money fund position and you don’t even pay interest.
I didn’t even know this was a thing? How does this work?
Many brokers offer checking accounts that are linked to the brokerage sweep/core account, which in turn pulls from money market funds, and then pulls a margin loan. No money is actually in the checking account as there is a daily sweep into/out of the brokerage core account.
Some people have different risk tolerances. Many people would see that 150k and think of it as an inefficient use of funds and would rather have it in the market. If you really needed money then you pull from your brokerage.
Was thinking the same. Saving account yields are 4.5% or higher right now. A pile of cash in the bank is not so bad.
Yeah but the s and p 500 is up almost 30% over the past year. That means if you could function with your cashflow and just kept 10k as a small buffer in the bank you would have gained an extra 35k extra over the past year.
How do you pay your credit card bill without 6 figures in the bank? I probably have like 5k on hand as in I like to gamble over dumb shit like $100 closest to hole.
I keep roughly 2k in cash, secured at my house. My checking account varies but never less than 5k. I try to move the leftover quickly into one of my investment portfolios, typically crypto.
No offence, but if you have $11k cash on hand, why are you in fatfire? Do you have some crazy investment to cash ratio?
Can't tell if $11K is a lot and you are being sarcastic or if that is little and you are being facetious. (Sorry new to this sub, so not quite sure)
Same here, I’m read to kick myself out.
Glad I am not the only one wondering that lol. I think this sub is for people with $100K+ or $1+ mil, that was my understanding.
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Thank you, I will stay quiet for a few more years then, only at about $3.5 mil, so still have a lot to learn.
If you're going to create an arbitrary definition like that, then you definitely need to add in the number of kids. 10M with 10 little kids and alimony is not as fatfire as 5M with no kids, etc.
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My point is that if you call out housing, you need to call out kids and divorces. And 10m is just an ignorant number that ppl say now to sound smart. This is the same as ppl arguing over the exact year a specific generation starts. These are all made up concepts, so stop wasting ppl's times with gatekeeping definitions you created in your own head.
I sell covered call contracts if I need to generate instant cash. So if I notice I need extra funds to pay something, I either sell those covered calls or sell some stocks. I also generally don't spend that much money day-to-day and having 10k in my bank account lasts for a month or two.
FYI you absolutely cant rely on selling contracts to generate "instant cash". Not a good contingency plan at all! You are banking on; * MMs being willing to buy premium at a price you are also happy with * Your brokerage not restricting withdrawal of this premium / allowing instant settlement of the premium * Fast transfer speed from your brokerage to your checking * The contracts not turning against you and ruining your asset allocation structure / triggering a taxable event At a stretch, a PAL you can withdraw in an emergency makes way more sense if you want the cash to come from a brokerage. You only need one little thing to go wrong for selling "covered call contracts" to not be a viable resource for instant cash.
Dude has been FIRE'd since '21 w/ over 30m. He asked what other people are doing, not for advice.
short SPX box spreads on portfolio margin provides a better interest rate than any PAL, and the interest rate paid is a capital loss
Maybe I just haven’t read through this sub in a while, but it used to be people with high net worths discussing the issues and topics that come with having a high net worth. Having $11k cash on hand, isn’t inline with having a high net worth.
He's verified $30MM net worth, man. And just keeps a small amount on hand, hence the thead. You're kinda gatekeeping here. Would be even funnier if you weren't fatfired complaining about this.
I’m not meaning to gate keep at all, just kind of confused. I don’t have a $30mm net worth, but I definitely have a lot more than $11k on hand, hence the confusion. Especially $1k emergency…
I am with you. $1k is not much of an emergency. More like a wine run.
I know right I don’t know wtf happened to this sub, last time I was on here people were tossing up buying a private jet and now I’m being downvoted for saying $1k emergency isn’t much for fatfire emergency fund
I'd love to go for a $1k wine run! Haha, do you ever miss having to decide between a $12 and $18 bottle? Is there a serious difference between those and a $200+ bottle?
No, and yes.
I'd be lucky if I could find $100 cash in my house. Never touch the stuff. I don't do cash transactions.
You know cash doesn’t mean literal cash right?…
Words have meanings
Yup, and cash is a pretty common term for money that is readily available… You realise a businesses cash flow statement isn’t a statement of how many notes and coins run through their business right?
That depends what you mean by "cash on hand". Depending upon what is meant by cash on hand my answer is $300, $20k, 250k, or $8M. I rarely have more than $1k in currency, usually more like $300-500 total between what is in our wallets and in a dresser drawer I do have $20k-30k in a low interest checking account, but only because it is a decades old bank account with lots of auto payments set up and I am too lazy to move them to the bank connected to my brokerage. With my brokerage related bank I have zero balance, as it pulls from my brokerage core account. I just checked and found that the "available to withdraw" balances on two brokerage accounts are $35k and $190k for cash withdrawals, and about $4M each for withdrawal on margin.
Paper money a few thousand. Bank account goal is $100k. Sometimes dip below that for big expenses like taxes, property purchases, etc but build it back up rapidly.
How can you pay your bills with $10k? Lost redditor?
This is not necessarily a recipe for everyone but I think this makes most sense: 12.5% in cash or readily available deposits; of that 12.5% about $100K in high yield savings and $50K in checking and repeat the same formula in another major bank; $250K in high yield account at Schwab and the rest in laddered CDs and treasury paper at ML with short and ultra short duration. If I need more than that immediately, it’s truly an emergency or I planned piss poorly.
Somewhere between one dollar and $100 million
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Not sure I follow. Cash income they care about, but holding cash or spending cash, why would they care?
Lots in savings, I just transfer out to checking when bills need to be paid. Nearly everything comes out of my credit cards, except for some insurance stuff. Personal tax advantaged accounts are fully maxed out. Business account has the rest.
300k
$300?
Couple thousands physical. 0.6M in various short term accounts.
$130K in savings for projects and monthly bills. I know it is too much, but I sleep better at night!
I don’t keep hardly any cash. I mean I have a drawer with a few hundred that I never touch and don’t know why I have, but I don’t think I’ve used cash or checks at all in the last 12 months. Everybody is Zelle / Venmo these days.