How Much Cash Should I Have on Hand
Retirement Solutions Eau Claire How Much Cash Should I Have on Hand?

Given that we’re increasingly becoming a cashless society, the question of how much cash we should keep on hand is difficult to answer.

A U.S. News and World Report article, How Much Cash Should I Keep on Hand, has some insights that may help you determine how much money you should keep in your home and in your pocket when you’re running errands or shopping.

Cash still matters

Let’s first examine when and why you may want to carry cash. Though it’s pretty common for folks to leave the house or office without so much as a few bucks in their pocket, that may not be the best strategy.

For example, some small businesses offer discounts to those paying cash because then they don’t have to pay a processing fee to a credit card company for those transactions.

Technology isn’t perfect

You also never know when a business may suffer a technical issue that prevents you from using a card. You wouldn’t want to coast into a gas station on your final fumes with just your credit card only to find out it’s going to be cash-only until the credit card machine is fixed.

Don’t leave home without it

While the article explains that there isn’t consensus about whether you should carry cash day-to-day, there is consensus that you should carry some local currency when traveling. The article recommends carrying enough cash to see you through 24 hours when you’re traveling.

Be careful with your cash

Cash is susceptible to theft, which means you should be thoughtful about how much you carry. What crook wouldn’t want to get their hands on that roll of 20s you keep in your pocket?

And it’s not just crooks. If you cross your legs at a restaurant and your money clip falls out onto the floor, and you don’t hear it, well, your cash may be gone for good.

If you lose your debit card or a credit card, or one is stolen, you may also be able to have any fraudulent charges refunded.

To combat theft or loss, the article recommends splitting your cash up. Put some in your front pocket and the rest in your breast pocket or purse. That way, if you lose some of it, you may not lose it all.

Keeping cash in your home

The article specifically addresses how much cash you may want to keep in your home. While some folks keep cash tucked away in their home in case of an emergency, the article notes that, realistically, there aren’t many emergencies that would prevent you from getting to an ATM.

Natural disasters are an example of the rare occasion when getting to the bank or to an ATM may be difficult.

Accordingly, a few hundred bucks stored safely in your home is likely enough to see you through most things, the article explains.

Spread it around

Just like you shouldn’t keep all your cash in one pocket when you’re out and about, you shouldn’t store cash in one place in your home. Keep some in a cupboard in the basement and keep some tucked away under the kitchen sink.

You can also get creative and wrap up some cash to make it look like a piece of meat and store it in the freezer.

The point is to simply make it less likely a burglar may be able to access all of your cash.

Finally, as for how much cash you should keep in your home, the article suggests that a max of a couple of thousand dollars is likely enough for most people. Remember, the FDIC insures as much as $250,000 of the money you have in one of its member institutions, but there’s no such protection for the cash in your sock drawer.


Advisory services offered through Buska Wealth Management, LLC a SEC Investment Advisor. Insurance products and services are offered through Buska Retirement Solutions, Inc., an affiliated company.

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