Financial experts have varying opinions on how much cash you should have readily available. They recommend different amounts for emergencies versus regular purchases. Leslie Beck, a financial planner, suggests carrying no less than $50 in your wallet. This approach ensures that you are prepared for unplanned outages and emergency situations. This recommendation reflects the real-world experiences of countless consumers, many of whom have encountered circumstances in which cash proved critical.
A recent survey by the Federal Reserve found that Americans, on average, only carry $67 in their wallets. We all know cash use is already declining. In a recent survey, only 83% of consumers said they had used cash at least once within the last 30 days, down from 87% in 2023. This is a sign of the increased dependence on digital forms of payment, as a number of experts have warned, it’s dangerous to go all cashless.
Caro wants to stress that carrying cash isn’t just about being able to pay for things day to day. “It’s truly inconvenient and embarrassing, depending on who you’re with,” said Brett Anderson, who learned this lesson the hard way when his credit card was declined due to suspected fraud. Now he keeps enough cash in backup to prevent that.
Tipiwa Walker advises that you keep $50 to $100 on hand for tipping, low-dollar transactions, or when the tech just doesn’t work. She points out the importance of balance: “Having large amounts of cash in your wallet makes you more susceptible to losing the funds.” Additionally, she warns that “cash simply does not have the protections that credit cards do.”
For everyday consumers who often need money for purchases like groceries or gas, Melissa Caro usually only has $60 to $80 on her person. She notes, “If I know I’ll need it — say for tipping, parking, or certain small businesses — I’ll add a bit more to my wallet.” Caro mentions a useful guideline for assessing one’s cash needs: “A good gut check is: If I lost my phone and needed a cab home, would I be covered? That’s my ‘panic point.‘”
Leslie Beck describes remembering cash was vital in an emergency, especially when running out through the aftermath of Hurricane Sandy. “When Hurricane Sandy hit the NYC area, ATMs were out, internet was down in many areas, and cash was king,” she stated. This situation highlights the importance of maintaining an adequate level of liquidity.
Christopher Rand notes that the sweet spot of cash is different for everyone. That, of course, varies based on each person’s daily routine and lifestyle. What is good for $50 to some is not going to be adequate enough for others to meet their needs.