Financial Planning, Retirement Planning

Where Should You Keep Your Money?

May 31, 2022

Reviewing Your Cash Position

With recent stock market gyrations and inflation concerns dominating the news headlines, you may be wondering if you have the right amount of cash on hand.

When re-evaluating your cash position, ask yourself the following questions:

  1. Do you have enough of an emergency fund? As the pandemic has shown us, life is full of surprises. An emergency fund gives you the peace of mind that if something unexpected were to happen, such as a job loss or illness, you’d have the liquid resources you need to maintain financial control. Therefore, you wouldn’t be forced to sell assets that may have tax or asset allocation consequences to get funds quickly. A common rule of thumb is to have about six months of living expenses readily available. However, if you’re a senior executive, it could take you a little longer to find your next role and having a year’s worth of expenses accessible may be more appropriate.
  2. How near are you to retirement? As you get closer to retirement, your advisor will review your asset allocation and help you plan for your transition into the wonderful world of retirement life. However, everyone’s financial situation and tolerance for risk are different so it is important to review your portfolio and talk with your advisor. You may need or want to invest more aggressively, especially if your savings are falling short or you anticipate a longer-than-average life expectancy. Throughout your relationship with Washington Trust, your advisor works with you to ensure your asset allocation is appropriate for you.
  3. Are you tempted to invest with your emotions? At Washington Trust, we believe in investing for the long run and remain disciplined in our approach and process. Although it may be difficult to watch the ups and downs of the markets, equities tend to outpace inflation and help investors achieve their long-term goals. Don’t allow your emotions to sway your investment decisions and seek the advice of your advisor to help bring current market fluctuations back to how it impacts you and your financial plan.

If you have any questions about your investment portfolio, the financial markets, or where to put your cash, speak with your Washington Trust Wealth Advisor for guidance. Follow us to learn more!

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This document is intended as a broad overview of some of the services provided to certain types of Washington Trust Wealth Management clients. This material is presented solely for informational purposes, and nothing herein constitutes investment, legal, accounting, actuarial or tax advice. It does not take into account any investor's particular investment objectives, strategies, tax status or investment horizon. Please consult with a financial counselor, an attorney or tax professional regarding your specific financial, legal or tax situation. No recommendation or advice is being given in this presentation as to whether any investment or fund is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors, or markets identified and described were, or will be, profitable.

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