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Ted Jenkin @ Your Smart Money Moves

Great article! Here are some additional considerations…

The first question you should be asking is whether you are employed (and where your job stability is at work) or whether you are self-employed. My opinion is that people who own a business should have about double the normal cash reserve of someone who is gainfully employed with a corporation.

The second question is do you anticipate any major life changes over the next year. This could be the birth of new child, an upcoming marriage/divorce, or potentially relocating your job to another part of the United States. These changes often create the need for more cash as your cash flow will likely be unstable.

The third question is what major changes do you see happening with your employer over the next 12 to 24 months. Do you see more layoffs coming or a department restructure? Do you see the company cutting the commission/bonus plans of the salespeople? Questions like these are important for impacting cash reserve.


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