Cash Buffer Sizer (Bond Tent)

"How big should my cash buffer be so I don't sell stocks at the bottom of a crash?"

By avoiding forced equity sales during the downturn, the cash buffer holder never had to lock in losses at the worst possible prices.

— Debugging Your Personal Finance, Chapter 8

Annual expenses ($) Buffer years (3) Current cash on hand ($)

A standard rule from Ch. 8: 2–3 years of expenses in cash equivalents (money market, short-term Treasuries, CDs) means you never have to sell equities during the first years of a downturn. Adjust to your own risk tolerance.

From Chapter 8 of Debugging Your Personal Finance. Simple calculator · Inputs stay in your browser · Not financial advice.