The Best Places to Park Your Short-Term Investments

There’s a bright spot in the market amid an overall gloomy picture. [Morningstar](?utm_source=eloqua&utm_medium=email&utm_campaign=newsletter_improvingfinances&utm_content=36404&elqTrackId=d99418fcf9f04e43acf742096ac6ebec&elq=a7434e375a9c4b33b69135ab378ff05a&elqaid=36404&elqat=1&elqCampaignId=17018) [Improving Your Finances] Improving Your Finances with [Christine Benz]( [Christine Benz] [The Best Places to Park Your Short-Term Investments]( As 2022 has ground on, bright spots in the market have been few and far between. Stock investors seem to vacillate between worrying about inflation and recession. Both concerns have weighed on stock prices, especially growth stocks. Bond prices, meanwhile, have gotten hammered due to the Fed’s campaign to stamp out inflation with a series of interest-rate increases. Yet there’s one small bright spot amid an overall gloomy picture: Thanks to the Fed’s campaign of rate increases, once-miserly yields on cash instruments, by no means lush, have begun to look a bit better. Of course, it’s a mistake to overdo cash holdings, especially with inflation as high as it is. Even with higher yields coming online, cash is still a losing proposition given that rising prices gobble up every bit of the purchasing power of your cash yields. But everyone needs an emergency cushion equal to three to six months’ worth of basic living expenses, at the low end. For retirees, I like the idea of maintaining a cushion of one to two years’ worth of portfolio withdrawals in liquid reserves; that way you don’t have to sweat losses in your stock and bond portfolios or risk having to sell them when they’re down. [Read More]( Share: [facebook]( [twitter]( [linkedin]( ADVERTISEMENT [media]( [media] [7 Steps to Estimating Your In-Retirement Cash Flow Needs]( Rules of thumb may be too high for affluent retirees with high savings rates, but healthcare costs are a major swing factor. [Read More]( [4 Financial Worries to Cross Off Your List]( Some worries belong in the "unlikely to happen/deal with it when it actually does" bin. [Read More]( [Eric Balchunas: Assessing Jack Bogle's Monumental Legacy]( The author and financial analyst talks about his new book, The Bogle Effect, in which he chronicles the Vanguard founder's personal and professional journey and the impact he had on investors during his fabled career. [Read More]( [Here’s How to Think About Retirement Income Today]( See what PGIM’s David Blanchett thinks a volatile stock market, rising yields, and still-hot inflation mean for the financial plans of retirees and pre-retirees. [Watch Now]( Listen Now Get the latest investing insights and market updates with [Morningstar’s podcasts]( available on your iPhone, iPad, Android, PC, or smart speaker. Stay connected: [twitter]( [facebook]( [linkedin]( [instagram]( [YouTube]( [Apple News]( [View online]( | [See all newsletters]( | [Share your feedback]( [Unsubscribe]( from this newsletter. Or update your [email preferences](. © 2022 Morningstar, Inc. All Rights Reserved. 22 W. Washington St. Chicago, IL 60602