With regard to the concept of
"Months’ Contingency Capital = Liquid Accounts / Monthly Expenses"
Perhaps too high a number is not optimal as funds could have been deployed for other investment considerations to yield better returns. I don't have a number but 24 to 36 months seems fairly decent, buffering with inflation like 5% annual increment.
Of couse if one has already achieved a substantial amount (millions or more) then it doesn't matter. But one has to consider for unexpected events and estimated the potential cash outlay.
With regard to the concept of
"Months’ Contingency Capital = Liquid Accounts / Monthly Expenses"
Perhaps too high a number is not optimal as funds could have been deployed for other investment considerations to yield better returns. I don't have a number but 24 to 36 months seems fairly decent, buffering with inflation like 5% annual increment.
Of couse if one has already achieved a substantial amount (millions or more) then it doesn't matter. But one has to consider for unexpected events and estimated the potential cash outlay.
Thanks for sharing.