Cash management is a fundamental part of many investment strategies. In layman's terms, it means putting cash to work.
The overall purpose of keeping cash in a portfolio is typically to maintain access while securing a conservative yield rate that beats a standard savings account at a bank. What that means specifically depends on the person's goals.
Cash management strategies are varied. People choose between them based on various factors:
Over the longer term, periods of growth often suggest different cash strategies than periods of stability. However, it all depends on a person's financial goals.
People hold cash via various types of accounts or instruments. The following are typical examples:
CDs are available through most banks. There are also secondary markets in which brokers trade CDs and T-bills on behalf of investors.
Appropriate cash management could balance risk, improve yield and maintain liquidity. That said, cash is only one part of a healthy, high-performing portfolio. When you're ready to move strategically toward your personal wealth goals, please contact us at Beronio Wealth Planning.