Is Cash Really King? Should I Keep it in my Home?

Many Americans are scared of keeping their money in the bank for one main reason: they think that their institution will go under, and all their savings will be gone. Even though most banks are FDIC insured this is still a common worry. For this reason, more and more people are living by the mantra “cash is king.” In other words, they are keeping all of their money at home. The question is: is this a good idea or can it get you into trouble?

There is nothing wrong with keeping some cash at home, but you don’t want to act as your own bank. Simply put, the risk that you are taking with your bank is much less than keeping all your cash at home. The bank has FDIC insurance in order to protect most or all of your money (double check on which accounts are covered). Unfortunately, you do not and cannot have anything as good as FDIC insurance.

If you keep all your cash at home you could easily lose it to a thief or disaster such as a flood or fire. One day all your cash could be safe and sound under your bed and the next it could all be gone with no way of getting it back. Is that a risk you are willing to take?

You should definitely keep some cash in your home, but never a large percentage of your overall savings. If you do this you are taking a huge risk, and asking for trouble.