[quote=carlsbadworker]
That still leaves us one question, AN/flu. What do you guys think is a proper cash holding right now in this kind of environment? I would think there would be some of emergency fund plus enough down payment for the next rental property? I don’t know what’s the magic formula here? Since you are not finding a rental property with the limited inventory in MM and you don’t want to pre-pay the house, you just watch the cash reserve starts to grow? Or just gamble it with the stock market even at the current high valuation?[/quote]
Thanks for making me look and check 🙂
Personally, this is where I’d say it’s a personal preference/comfort..A lot of it depends on where you are at relative to your family,expenses. What’s your risk tolerance. How careful or careless you want to be. What’s the propective of your career, and where you want to go.
Me? I’m getting lazy. I’m getting tired of slaving away as at work work. I’d like to enjoy life a bit now… I have kiddie expenditures and I like cars…
While I have an positive outlook on my economic future, I think right this very moment it’s a shitty time to go all in any one particular thing right at this moment.
If I look over my total net worth (which I feel is worthless…different story) is split roughly
Stock: 40%
Home(s) equity: 35%
Cash: 25%
Total Debt/TotalAssets: 21%…
In a few days, hopefully after refi’s close, it will be more like
I didn’t include my liquidable cash in a savings/checking account for which I use for day-day bills, because it’s insignificant.
Right now, I’m trying to reduce equity and increase my cash reserves so that I can be ready for the next thing. I am going to wait a bit on the sideline. I’m not thrilled about entering the stock market in any meaningful way right now or buying another property that isn’t already in the pipeline right now, though I still look. I might play a small hand or two in the stock market just to make myself feel better so that I can beat a CD, but that’s about it.
I would feel comfortable “borrowing” up to a debt/asset of 50% and keeping it there, (provided it continued to grow the total asset lol). I figure if the unfortunate event that investments blow up -50% across the board and $0 cash flow across rental properties at the same time, and I’d still be able to cover my debts and hold out and live off of my paycheck without affecting my standard of living.
Meanwhile, I’m trying to break out of the frickin rat race which is the purpose of my borrowing.
It varies…Even AN and I disagree on different levels of leverage. He’s a proponent of 30 years and refi with negative points. I get it, but I can’t bring myself to it. I do a 15 year because I’m a wuss. That’s why AN lives a luxury while I live an a crapbox.
