Cubanpete are you against people earlier in the fire journey keeping 50k ish in cash for liquidity?
I misread the pole t&cs earlier… but if one has a mortgage and then keeps ~50k for liquidity, it is still possible to be significantly short cash
I‘m cash negative, due to use of leverage (margin loan).
I even did away with my emergency fund, because it doesn‘t make sense to hold one if you are cash negative, that just causes me inefficiencies and interest I need to pay. If I need cash I just borrow more, and that is incorporated in the plan beforehand to account for that possibility.
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Of course it makes sense. I keep cash for around one year of spending in all major currencies I use. But mine is covered with debt, I don’t want to give away value. When power was down in whole Spain people without physical cash were sent out of the restaurant…
That is the main reason you think debt is a big risk; it is not if you hedge it with cash. Or, better said, if you hedge your value-losing cash with value-losing debt.
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Do you have any recommendations for any bonds that provides any performance in CHF?
Made my first money in finance like 45 years ago with Canadian junk bonds. Without really understanding what happened there… got them for Cents on the Dollar and then some management buyout happened and I got paid back in full plus compound interest for many years. That was when I realized you can really make money in the markets. (Later I found out that you can really lose money in the markets…).
To answer your question: no, at least not risk adjusted. Junk bonds may help but I am not even sure that those exist in Switzerland. I do not invest in Swiss securities and I do not invest any longer in bonds, sorry.
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I have about 10k in cash, then 3 months’ notice on my employment contract, so thinking about it as having 4-5 months’ emergency fund, then RAV for 1.5 year if I lose my job, should be enough.
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You forgot to mention your iconic “cash is trash” note 
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Let’s give Pete, King of the Rumba Beat, a break!
Edit: we can also mention the phrase “cash burning a hole in your pocket”, took me personally more than a year of holding inert cash on the side without itching all over to do something with it, or if I wanted to sound smart say “have positive carry”. The rest of the world’s inflation/devaluation of currency is very vague and intangible when living and spending in CH. For me at least!
Not everyone can sleep well with the volatility of 100% (or 150%) stocks. To mitigate this, people outside CH usually add bonds. In CH with very low bond yields, low inflation, and unfavorable taxation, cash seems like a “not great, but many times an OK” tool for reducing the volatility and stock crash impact.
Having said that, I admire people that are in 100+% stocks. (Though still I have the feeling that not everyone will keep it like this if the market goes down 50% and stay negative for a decade)
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Agree, you need a good plan and then more important stick to it in any situation.
But that was not exactly the subject; everybody needs cash and I think it is a good idea to hedge this cash with debt. There is no more risk than the debt interest being higher than future inflation. And that risk is limited.
Shit, almost forgot it again: cash is trash!
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Cash does have some uses! Example: How do you pay the border guard in rural Cameroon who asks if you have the No 18323.B/3 certificate for dengue fever vaccination? No, not the one from your country that the embassy said you must have, this one! *points to torn and stained piece of paper stuck on the wall, 3 meters away, is in French, and is illegible*
How do you “buy” your shoes off the mountain patrol in the mountains of Peru who demand you give them your hiking boots?
Both examples happened to friends of mine, both got solved with $20 bills 
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I normally have close to zero in cash as everything that comes in gets quickly invested into the stock market. Against that I have quite a lot of debt due to mortgages.
It is useful to have a good sized working buffer of cash as it is annoying and mental load to always have to sell and transfer cash back to your bank account when you have an unexpected large expense because you kept your balance close to zero.
I found that having 10k-20k in the account means I no longer need to shuffle cash around to manage cashflow and so improves my mental well-being.
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Funny, same happened to me at the Nicaragua/Costa Rica border. You had to pay not directly the uniformed border patrol donkey but some private fuckers sneaking around. I suppose the border police is supervised somehow. They just wouldn’t let you pass before you paid those bastards. I recommend entering Costa Rica via SJO airport, no problems there.
In Panama I was on an island with only one weekly flight (OK, there were boats) and the border fucker sold me a foto or threatened to search me until the plane left. He asked for a 100(!) I offered him 20 what he accepted, some American surfers paid the 100, but I suppose they had something in their surfboards (that occupied almost the whole airplane). The border officer was the fattest man I have seen in whole Panama and there are a lot of fat people in Panama.
Had some life-threatening situations in Venezuela and Mexico too where only bribes helped.
Travelling I used to carry 200 bucks cash inside my shoes, so I understand why they wanted the shoes of your friend…
Every cop is just a criminal! as the poet Mick Jagger says.
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I have way too much cash just sat in the bank, but:
- I had planned to buy a small apartment in a ski resort - a dream for a long time. Eventually I decided it didn’t really make financial sense as the costs went really high after covid .
- January 2025 I decided I should invest the money, and after slow DCAing for a few months put 50K into VT a week before Trump’s liberation day, I’ve kind of been scared since but do move all new savings into IKBR
- My wife passed away at the start of this year and I am a little worried about refinancing the mortgage in 3 years. I will probably put some amount in pillar 2 (need to do this soon so i can withdraw it). And probably look at one of the fixed savings account , because even with the .g. 12 months notice to withdraw, I will hopefully have a clear picture. That might return 0.8%, but better than nothing an will mean not everything is in a single bank.
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As others have already pointed out the answer IMO depends heavily on what phase of your life you’re in, your current life circumstances and what risk tolerance you have.
My experience / plans:
- Pre-retirement, being the main salary provider for a family: several 10k of cash (equivalents) at least.
(IMO even if you already own signficant assets, but that’s personal taste) - Early-retirement, significant assets under your belt, mostly living off the cash flow produced by your assets: 0-10k of cash (equivalents).
This was me/us until 2024. - During retirement years where you or your partner can withdraw sizable pillar 3a or pillar 2 money: sometimes 0-10k, sometimes several 10k, occasionally several 100k, fluctuating over the given year depending on taxes owed and investments or travel planned.
This is me/us starting in 2025 and probably lasting for another 3-5 years. - In retirement years where you’ve withdrawn all your pillar 2 and 3a and can reliably live off the cash flow produced by your assets plus the AHV: usually 0-10k of cash (equivalents), occasionally several 10k for that ten day arctic cruise ship or that around-the-world trip in 80 days[$] on a more upscale travel style.
As always, YMMV, and everyone should hold the amount of cash (equivalents) that let’s them sleep well at night (SWAN). Some Can’t Get No Sleep without significant debt on their balance sheet, others only SWAN while reciting “Cash is King” as their lullaby and goodnight song (perhaps while listening to Enter Sandman?).
$ My wife prefers the arctic cruise, but I think I lean towards the 'round-the-world trip.
Why not both?
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I think absolute numbers are meaningless unless net worth is declared, but I’m at around 5% cash.
maybe not, my networth is constantly increasing, while i keep a stable amount of cash because is just for “emergencies”
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Both % and absolute value give information imho.
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Sorry about a possibly basic question, but what do you mean by having cash but hedging it with debt??? Or even having negative cash. I have a mortgage and have kept off other debt.
If someone can show an example how cash flow in a month looks like to have negative cash? For instance if you have an income of 10k and expenses of 5k, if I invest all remaining I still have 0 cash? What debt are we discussing here?
Negative cash means „short“ cash in the sense that you owe in aggregate (cash or cash equivalents vs debt) cash to others in the future.
Reason this is preferred is that if the value of cash is decreasing one can trade less of their assets in the future for cash then today to give the owed cash back to lenders.
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