Pixabay
A couple of days ago, I was at a hangout with my friends. We usually have time every quarter to come together to rub minds, talking about our next big moves, careers and relationships. I would always say little about politics because I find it draining to talk about something i can not change. I watched as they talked about political issues (particularly, who we think will be the winner in the next presidential election and which presidential candidate has the best exposure with respect to economic and finance.). It led on to our cherished Netflix series and trending blockbusters too.
Having a knack for finance for the past 5 years, the vast majority of my exciting discussions were focused on cash and investment. Then a question was raised, my face was lightened because it's finance related: How much cash is "sufficient cash" and "when can one quit stressing over cash?"
That is a controversial question to start with. "Sufficient cash" would rely upon what an individual's monetary objectives are and if their portfolio can easily take care of their financial needs at any point in time.
For one person, it very well may be buying a big pleasant house in a big city and having enough to the cater for their family. For another person, it very well may be as the first, but with an addition of affording periodic vacations and any trending luxury.
Sufficiency is just a relative word. And in finance, that a person is not showy and flashy doesnt necessarily mean that the person doesn't have sufficient cash to be flashy. I believe that people's financial lifestyles are also controlled by their personality to some large extent, hence, sanguines are more likely to spend on flashy items while phlegmatics would not.
So What Amount is Sufficient Cash Then?
I have come to reason that sufficiency would be that I can keep up afloat with my objectives and goals despite all odds. Sufficiency and quitting from the stress of not toiling for cash may sound easy to the ears but the truth is that it is a life long game. Ever heard that, it is hard to get rich but harder to stay rich? Sufficiency or having enough to me is your ability to maintain your current lifestyle regards of any economic trend.
To be sufficient, to me, would mean to stay rich or wealthy. And to stay rich or wealthy would also mean to keep earning. Now,of what use will be your earnings if they are being eroded by inflation and taxes? Yeah, to stay rich would also mean to be smart at preserving your income.
Like i said, it is a life-long journey, a game of continuity. Even the best stream of incomes needs to be optimised to stay running, else they get blockades and goes bad.
To summarize, staying rich should be an objective or a goal. And the truth is we need to keep working on our objective plans to achieve them.
Objectives change too. One of my initial
financial objectives was to have the luxury to eat the very thing I want to eat anytime.Whenever that objective was met, the next would was to live in an beautiful area with lawns and stable power and fast internet (Nigeria though, but a work in progress).
These objectives would steer me to have a portfolio exclusively committed to good life I'm keen on. The investments I make towards that are very unique.
The beauty of holding cash is to solve one's issues, take away that and cash has no value. Sufficienct cash is a place of multiplying and managing cash.