Do you have a lot of cash at home?Insiders recommend preparing tens of thousands of yuan more, and the three major reasons are analyzed
With the development of technology and the popularization of the Internet, people's lifestyles are constantly changing. In the past, people used to keep cash at home for a rainy day, but now, with the advent of mobile payments and e-banking, more and more people are choosing to deposit their money in banks or e-payment platforms. Recently, however, some experts have suggested that people should keep a certain amount of money at home, and why?
Let's take a look at what the experts recommend. Experts stressed that the current uncertainty in global financial markets is increasing, which means that the financial environment may change significantly in the future. In this case, holding cash can be used as a survival strategy. When the market is volatile, cash holders can better deal with risk and prevent their funds from being deeply trapped. In addition, experts emphasize that cash reserves can be used as a household emergency** in case of emergencies or unexpected expenses.
How much should you set aside?Experts suggest that each family should have at least tens of thousands of cash reserves. This money can cope with short-term financial market volatility and the urgent needs of households. Of course, the exact amount of reserves depends on the family's financial situation and risk tolerance. For some people, it may not be a good idea to put their money aside. For example, for people who need to invest, it may be more appropriate to deposit funds in a bank or electronic payment platform. In addition, for some people who are not good at managing money, cash reserves can put them at risk of theft or loss.
In addition to expert advice, we should consider the need for a reserve currency from other perspectives. First of all, from the point of view of economic security, cash reserves can be used as a means of fighting inflation. In the case of inflation, the purchasing power of money gradually decreases. Holding cash preserves the real value of the currency and prevents the loss of assets. In addition, cash reserves can also be used as a means of preserving value. In some cases, the volatility of some assets** can fluctuate significantly, and cash reserves can be used as a balancing tool to prevent fluctuations in assets** from having too much impact on a household's financial situation.
In addition, holding cash can also be used as a means of dealing with future uncertainties. There will be a lot of changes in the economic environment in the future that we can't manage, and holding cash will allow us to better cope with these changes. For example, in the event of a future economic crisis or financial market crash, cash holders can better manage the risk and prevent their funds from being deeply trapped.
However, some may think that cash accumulation is outdated. In modern society, mobile payment and e-banking have become mainstream payment methods, and people can easily transfer money and pay through mobile phones or the Internet. However, it should be noted that although electronic payment methods are convenient and fast, there are also certain risks and uncertainties. For example, security issues such as cyberattacks and data breaches can put people's money at risk of being stolen or lost. In addition, in the event of an emergency such as a power outage or network failure, electronic payment methods may not be available. In this case, holding cash can be used as an alternative payment method.
Cash reserves must take into account the impact of inflation. While cash can maintain some purchasing power, the real value of cash will gradually decrease due to the effects of inflation if held for a long time. Therefore, while setting aside cash, it is also necessary to pay attention to how to deal with inflation, that is, to achieve asset appreciation through investment and other means. Cash reserves must be security in mind. Keeping large amounts of money at home can be at risk of theft or loss. Therefore, it is necessary to take some security measures, such as keeping money in a safe deposit box or using a safe method of saving.
Liquidity issues must be taken into account in cash reserves. Although holding cash can cope with short-term financial market fluctuations and households' emergency needs, if the amount of cash reserves is too high, it will affect the liquidity of household finances, resulting in the inability to meet long-term consumption needs. Therefore, when setting aside funds, it is necessary to plan the family's financial expenses and savings plan reasonably.
In short, you need to accumulate funds. Although modern society has entered the era of electronic payments, it is still very important to have a certain amount of cash. Cash reserves can be used as an emergency fund for households, a means to resist inflation, a means to maintain and increase value, etc. Of course, the exact amount of reserves should also be determined based on the family's financial situation and risk tolerance. There is still a long way to go, so let's work together to deal with uncertainties and risks!