Preview of what we’ll cover today:

💧 Liquid Security: Access matters without sacrificing growth

🏦 Checking Balance: Keep only monthly spending needs

📈 Emergency Funds: Long-term reserves may deserve investment

🔓 Liquid Accounts: Taxable investments remain easily accessible

🧰 Retirement Toolkit: Pilots can request planning resources

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More About This Episode:

Ever wonder if your “safe” cash is actually holding you back? In this episode, Ryan answers a listener’s question from a pilot who has built up $150,000 in cash but is hesitant to move it because of the security it provides. He explains the difference between liquidity and leaving too much money idle. Stick around to find out if your cash strategy is helping, or quietly hurting, your future.

Go Deeper Into The Episode:

0:00 – Intro

0:25 – Listener Question

1:27 – Emergency Fund Balance

3:20 – Free Portfolio Analysis

Resources:

Retire Pilots – https://retirepilots.com

Get your FREE Retirement Toolkit – https://bit.ly/3ZmZsaX

Pilot Tax – https://pilot-tax.com/

The Pilot’s Advisor Podcast is also on video. Watch & Subscribe on YouTube: https://bit.ly/3EIEBW2

Connect with Pilot-Tax: https://pilot-tax.com/

Episode Transcription:

(Note, this is an automated transcription. Please forgive any errors.)

Walter Storholt 0:00
Welcome back to the Pilots Advisor. On today’s episode, we’re answering a lister question about having too much money in the bank. I’ll grab Ryan, and we’ll get started. All right, great episode on the way today. I’m Walter Storholt, as always, joined by Ryan Fleming, the Pilots Advisor himself, and we’ve got a listener question today to break down on the podcast, Ryan. And here it is: My brother tells me that I have way too much money in the bank, and he’s probably right. It’s about $150,000 now, but I just like knowing that it’s there in case of an emergency. Is that so bad? I’m sure this is not the first time you’ve seen a pilot in this kind of situation,

Ryan Fleming 0:41
yes, it’s that bad. I I cannot stand this. I think it’s great to have want to have liquidity and want to have money there for in case life happens, in case that emergency. And I call that liquid security. However, if it’s sitting in your checking account, if it’s sitting in a savings account, if it’s sitting in a high yield savings account, you are going broke very very safely. The bank is taking your money and making money off of it because you’re not letting your money work for you. You can have your money invested in the market, be very very diversified, and if you need it, we could have it back to you in one to two business days. But let your money work for you. Don’t let the bank use your money to make money.

Walter Storholt 1:25
It’s a great point. Is there a right amount? I mean, is it the six months emergency fund that you go with? What’s usually the recommendation that you have for pilots? Because I know that their advice is usually not the same as conventional wisdom.

Ryan Fleming 1:37
Well, I think that you know your checking account needs to be whatever you feel comfortable seeing in there all the time for month to month activities. You know whether that’s 10,000 20,000 I don’t know. Everybody’s a little bit different, right? I mean, when you were 18 or 19, it might be 2000 So whatever that money is for just the day to day bills, cash flow, month to month, I would keep that in your checking account. Anything outside of that, you need to put it in some sort of whether it’s earmarked for emergency or it’s just life. I would put it in some account where it’s actually outpacing inflation. Now, when you’re talking about an emergency, six months of an emergency, I understand how you wouldn’t want that to be exposed to the market where it could be down 10% or 15% at any given day, but if you’re doing this right and putting money away, at some point in time you’re way past that emergency fund anyway. So even if the market’s down 10 or 15% you still have plenty of money for that emergency. So at that point in time, I think even that emergency fund should actually be invested in the market and working for you over the long term, because that compounding interest of those gains outpacing inflation, you’re going to be so far ahead in the long term, and and once again, you still have complete liquidity. I think that most people, because they’re so used to seeing only 401k or IRAs, which are retirement accounts, that they can’t touch to their 59 and a half. They don’t realize that you can invest money in the market that is completely liquid, and I don’t think people truly understand that that you can have a taxable investment account that is invested in the market that you can access at any point in time. So let your money work for you. Don’t let the bank take advantage of you.

Walter Storholt 3:18
Yeah, all great points, Ryan. It’s a really good question as well. If you have a similar question to this, something related to your own finances and financial situation, don’t hesitate to reach out to Ryan. Get the retirement toolkit. It’s specifically built for pilots to help you understand some of the basics about planning for your retirement future and investing. It’s packed with all sorts of great resources. You can order that by clicking the link in the description of today’s show, it’ll also qualify you for a free portfolio analysis, which includes a one-on-one conversation with Ryan about your plan, your goals, and the future. So take advantage of that and order the toolkit today. Again, link in the description of today’s show. Great listener question on today’s show. You can submit those online, of course. Just look for the ways to do so in the description as well. We’ll talk to you again next time, right back here on the Pilots Advisor.

Speaker 1 4:12
This episode is for educational purposes only and is not individualized investment advice. The Pilots Advisor LLC is an SEC registered investment advisor. Registration does not imply a certain level of skill or training. Past performance is not indicative of future results, and investing involves risk, including the possible loss of principal.