Cash reserves - those who have it do not sweat the little things.
Living in a society which encourages you to spend, spend, spend, it can be difficult to remember the power of cash reserves. Cash, however, creates opportunities that spending never can.
Cash puts you in a position to buy when everyone else wants to sell, allowing you to make money in good and bad times.
If you need help changing your spending habits, print the list below and tape it to your refrigerator door, put a copy on your desk at work…keep it in your car.
Read it every morning and every night, until you can feel the power of cash; until saving feels better and more powerful than spending.
10 Reasons to Keep Cash Reserves
- Protects your family in case of a job loss
- Provides reserves for health or other family emergencies
- Gives you the ability to pursue attractive investment opportunities as they come along
- Helps you negotiate lower prices on major purchases
- Keeps you from losing money since you won’t need to sell other investments during down markets
- Allows you to avoid tax penalties by having to pull money out of retirement accounts too early
- Reduces stress which increases health and well being
- Eliminates numerous marital arguments
- Creates a cushion to use for major household repairs
- Enables you to pursue bargain buying at someone else’s expense (someone who desperately needs cash)
Where should you invest your cash reserves? In a safe investment. Read Making Safe Investments for specifics.
