I’m wondering how much emergency cash to keep on hand.
Not HYSA emergency funds. I have a plan for that.
As I am reworking my budgets and financial plans, I realized that I haven’t thought about emergency cash and how much to keep in the house.
What’s recommended? Is there a flat amount? Is it per person in your household? …
How much cash should I have on hand?
byu/Ok_Hornet3415 inpersonalfinance
Posted by Ok_Hornet3415
26 Comments
I don’t think that readily accessible cash is particularly important. I keep cash on hand but it’s mostly a convenience thing versus an actual financial decision. I can go to the ATM and get cash in 15 minutes if I had need but mostly everything I do will allow for transactions via check, card, venmo etc.
not much. whats the argument for cash under the mattress vs quick run to an ATM??
are you in such a rural area that you couldnt possible get hard cash in hand under 30 minutes ??
we usually keep 20-100 just for random work/social things that get forgotten about
Actual green cash money in your home?
As little as possible. Most folks will never need more than a few hundred green dollars at any given time.
It really depends on your household
Somewhere between none and whatever you regularly need
I don’t hold any physical cash. If the world got to the point where the internet was not available for a significant period of time what’s the paper worth anyways.
A hundred dollars in each denomination
In case stores or gas stations can’t process cc for some reason.
I keep enough to pay my yard guys for a few months. Can’t imagine ever needing more physical cash on hand. The bank is just down the road if I need more…
I dont need any actual cash. I have credit cards and venmo. In some rare instance I need actual cash there are thousands of ATMs and the actual bank is 5 minutes away.
$100 or so. I can carry around $100 in cash on my pocket for a month or longer as I seldom use cash for anything.
I routinely have zero cash on me. ATMs are plentiful where I am and I literally can’t go anywhere without passing one.
I keep like $100 in small bills in go-bags in case we need to evacuate for a storm event or something.
For day to day stuff, cash is useful for the many small grocery stores and restaurants in my neighborhood that charge 3% or more cc fee. I also pay our cleaning lady in cash every month. But other than that, it really depends on your lifestyle.
I keep 100 stashed in my phone case, 40 in my keychain wallet, a 20 hidden in my car and about 500-1000 in various denominations in our safe at the house.
I can definitely justify the 40 in my keychain wallet because it saved me at the grocery store once when the payment systems for cards went down. Ive also bought gas with it. I’ve had to replace the 20 in my car a few times when I got stuck somewhere without gas or lunch.
I keep the 100 in my phone case because I love going to a Korean spa about an hour from my house. If you don’t have your ID on you, they will take $100 cash as a deposit to let you in. Cash only. I went with friends once and forgot my wallet at home so I didn’t even have my debit card to get 100 bucks at the ATM. I wound up sending a Venmo to a cashier at the grocery store down the street so that she could get $100 cash back on my behalf. It was very stressful. (First world problems) Now I make sure I have cash for my spa deposit.
I’m also prone to anxiety, so cash at the house is basically a prepper security blanket. The only time I have gotten into it was when I forgot to get cash to pay a babysitter.
*Edit*
I lied!! I also had to use my safe cash when I backed into a teenagers car that was parked behind my driveway. It was an older car and pretty minor dent, so we gave him 500 bucks and called it even. It saved a 10pm trip to the ATM 20 minutes down the road AND an insurance claim.
I keep about $60-100 cash in my wallet about 90% of the time and refill it when I grab cash to pay my housekeeper. Anything else feels unnecessary
Local merchants and restaurants in our area charge 3-4% for transactions by credit card. Big box stores pay lower fees and don’t charge. We keep a week or two in cash normally, more for service people when needed.
We have had instances where power and internet were out but local stores were on generators. Cash is very helpful in those situations.
What if the power was out? ATMs don’t work when there’s no power, neither do fuel pumps. I think $3000 is an adequate number, if able.
I keep a few hundred dollars in cash stashed away in case there’s a power outage or something like that where we can’t use cards. And I usually have $5-30 in my wallet, depending on when my next haircut is (my barber prefers cash).
I keep $20 in my car, $20 on my phone, and $100 in the house.
I usually have a few hundred dollars in odd bills, mostly for buying/selling on marketplace. I don’t see any reason to have more than that, unless you like very rurally where digital transactions are less commonly used. I use my cc for everyday purchases
I never have more than $100 in cash on me unless I received it unexpectedly. But I do like carrying cash for things like tips and just to have it handy.
Physical cash? I might have $20-30 in my wallet. But I have just under $10k in my credit union at all times, separate from my money market emergency fund.
I figure my credit card is good enough for immediate spending.
I always figured on 1 month’s expenses in cash.
That way if there’s a problem with my accounts I can always count on having a month to sort it out before it affects any of my bills.
The downside to it is any cash you just sit on isn’t earning you any interest and is actually losing out to inflation over time.
So I would only consider keeping a significant amount of cash on hand after you have a decent emergency fund in an interest bearing account.
I’ve heard people in Florida keep cash to cover 1-2 weeks of expenses in case a hurricane knocks out the power and there’s no access to banks/credit cards. If you live in an area prone to natural disasters then keep enough cash to pay for things during the recovery.
If you live in an area without natural disasters there’s less need. I keep a couple hundred bucks in a gun safe and $80-$100 in my wallet.
I used to keep $20 in my hat but then I lost the hat while rafting.
I have a secret hundo hidden on my person. If I forget my wallet, get drunk downtown, car breaks down, whatever happens to me, $100 seems like it’d solve all sorts of problems, like get me a ride home.
Google the Upright Citizen’s Brigade’s “Ass Pennies” It can give a certain confidence.
My mom used to tell me to always keep a quarter to be able to call home in a jam. I tell my kids to keep a $20 on them, which might cover a cab. Maybe the hundo is a better idea, but a significant portion of their net worth. I kept a $20 on me as a young adult, but inflation and lifestyle creep has made it a hundo. $20 should get a cab to an ATM. Last I checked ATM limit was $400.
I’d like to move back to cash, but I’m too lazy to go to the bank that much. Like it is better to pay small businesses in cash, restaurants and the like. Avoid that 3% transaction fee with the card, or with tipped workers it is then their choice to report it to the IRS or not. My barber only takes cash.
$400 might be about right, what the ATM will replenish. I have “cash” as a budget line item, $400/month. I look at the cash I took out last year, average that, and it becomes a monthly thing. For last year, I could probably reduce that to $100 for what I actually did last year
In the moment, that cash is budgeted out. “Eh, I only have $20, not enough for dinner, I’ll just go home” Or, “I have $200, but restaurants are expensive, I’ll just go home”
What I spend on exactly with the cash doesn’t need to be called out in my budget, it is just the cash nebula. My haircut might be a recurring expense, or have a return on investment, but tracking such things that close, might be a bit too much effort for me, for questionable gain. If I want to reduce that item in the budget, I think in the moment “I’ll skip going to the restaurant now even though I have the cash, I need to save” Maybe if that $400 is at home, and not in my wallet, it will encourage me to save, so there is that, or I just whip out the card anyway. Whatever kind of games you play with yourself that work for you are fine.
$400 would get me a tank of gas, and a couple nights lodging if some disaster sent me out of town, so that might be nice. $1000 would be better, but would cost $40/year in opportunity cost. It is a balance.
Answer to your question might be “What are you worried about?”
I keep a decent chunk of cash on hand in a fire safe for a couple reasons – we got through the 2003 Northeast blackout in decent shape because my mom had enough cash on hand to buy a generator. Some hardware stores were open, but they couldn’t take any form of payment besides cash. Hurricane Helene also provided a nice reminder that sometimes the power goes out and stays out for longer than you’d like. Again in that situation – some stores & gas stations were still able to function with generators etc – but there was no communications for any currency except cash. Our power and communications grids are pretty reliable, until they’re not.
I don’t expect to ever need enough cash to cover a month’s worth of normal living expenses – but I want to be able to buy some emergency home repair materials or whatever with no notice and no access to credit/debit/tap to pay.
Well the rule of thumb is if you are doing a job then 6 months worth of your expenses and if you are self employed then 9 months worth of your expenses. The scenario may change for individual and their current financial sistuation as well..