Comment by dangus

Don’t spread this kind of financial illiteracy.

Cash is worse than even the worst observed scenarios of stock market investing.

E.g., cash is worse than if you had bought your whole portfolio with the worst timing possible like right before the 2008 crash.

I calculated this out comparing typical savings account APY with S&P 500 and the break even recovery of the S&P account is 2013, with annualized returns at 7.4% for your investments versus 2% APY for cash. That means your cash account is less than half the size of your investment account by 2024. And this is the worst case scenario with a massive market crash and the entire portfolio purchased at the exact wrong time - very unlikely, most people invest continually over time.

The only purpose of cash is for immediate liquidity.

People who invest in the stock market expect large fluctuations including major market crashes. That risk is baked in to the expectation of long-term reward.

If you need to stabilize your portfolio to prepare to withdraw from it soon and preserve its value, talk to a professional if you don’t know what you’re doing. They probably won’t recommend 100% cash deposits unless you’re literally spending it all this year.