As many of my clients approach retirement, I often emphasize the importance of maintaining a dedicated cash reserve. Having at least six months of income in accessible cash isn't just an entrepreneur's rule—it's a practical strategy for anyone nearing retirement. This cushion can help you navigate unexpected health expenses, home repairs, inflation surprises, or market downturns, all without needing to alter the retirement plan you've worked so hard to build. Some financial experts even recommend setting aside up to twelve months of essential expenses for greater flexibility and peace of mind. I encourage separating this cash buffer from your daily accounts, keeping it liquid in savings accounts, money market funds, or short-term CDs—prioritizing access and principal protection over chasing higher yields. In the five years leading up to retirement, it's wise to review your reserve annually and use it as a safeguard to avoid selling investments during turbulent times. Thoughtful preparation today can bring real confidence for the years ahead.
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