I'm not criticizing, but would like to point out you may fit the definition of "asset rich and cash flow poor" and, under certain circumstances, could essentially be bankrupt due to an inability to access funds. A recent example would be the entertainer 50 Cent declaring bankruptcy in the context of a judgment totaling in the millions. Also, based on my experience on Wall Street (note: not a licensed advisor or broker), I remember when the Auction Rate Securities market collapsed, and hundreds of millions of dollars in "as good as cash" (sic) structures were suddenly rendered illiquid. I mention this simply as context for what can happen in the financial markets in undesirable scenarios.
Not taken as criticism, and I absolutely know where you're coming from; solid advice. My mitigation is tight stops, and yes, I know what the downsides of those can be in a crashing market. The risk/reward for me versus a savings account at 0.5% is acceptable to me.
Or if you mean it's all tied up in a 401K, yeah, I hear ya. The vast majority of our funds are in there. The mitigation to that is a goodly amount of cash (easily get by for a year with no income) in a standard brokerage account that has a debit card and a checkbook I've got lying around the house somewhere, under the assumption that something like AAPL should be liquid enough should we need the cash. But, see above...
Very cool! Also, a nice elaboration without getting too granular. I'm hoping none of these scenarios come to pass...but they aren't called "rainy day funds" because of sunny outlooks.
