Liquidity and Cash Management in Volatile Times

Fast Facts

• Liquidity is simply how fast you can get your hands on cash when you need it most.
• When markets get bumpy, having enough cash on hand helps you avoid selling investments at a loss.
• As the year wraps up, it's a great moment to check your emergency fund and see if your liquid investments are still on track.

Why Liquidity Matters

Key Benefits

• Gives you peace of mind and financial stability when the markets swing.
• Lets you jump on market opportunities as they come up.
• Protects you from having to sell your investments at the worst possible time.

“Smart cash management means you won’t feel pressured to sell investments when the market is down.”

How Much Cash Is Enough?

Quick Checklist

• Could your emergency fund cover your bills for a few months if needed?
• Could you handle a surprise expense or grab an opportunity—without touching your long-term investments?
• Are you sitting on too much cash and missing out on chances to grow your money?

Cash Management Strategies

Top Tips

• Take a look at your emergency fund before the year ends and adjust if needed.
• Try to strike a healthy balance between having cash ready and growing your investments for the future.
• Set up monthly reminders to check your cash and liquidity, so it becomes a simple habit.
• If you have extra cash, consider putting it in short-term investments like money market funds, so your money keeps working for you.

Takeaway Box

Action Steps

• Give your cash and liquid assets a quick checkup as the year closes out.
• Make sure your cash on hand matches what you’ll need to spend—and how you feel about the market right now.
• Use checklists and set up automated reminders to keep your finances on track throughout the year.

Next Steps & Resources

• Download a liquidity checklist.
• Consult your financial adviser before making investment changes.
• Review additional SEC guidance on liquidity management.
• Further reading and tools:

·        

• Importance of Cash Management: https://www.debtbook.com/post/importance-of-cash-management-in-treasury
• How to Invest Your Emergency Fund: https://www.investopedia.com/how-to-invest-your-emergency-fund-for-liquidity-5069769
• SEC Guide to Investing Decisions: https://www.sec.gov/investor/alerts/bulletin-investingdecisions

Sources

• https://www.debtbook.com/post/importance-of-cash-management-in-treasury
• https://www.investopedia.com/how-to-invest-your-emergency-fund-for-liquidity-5069769
• https://www.sec.gov/investor/alerts/bulletin-investingdecisions

Disclosure
This article is for informational purposes only. It does not constitute investment advice or recommend specific securities or strategies. Please consult your adviser or SEC guidelines before acting on any recommendations.

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