You should maintain just enough money in liquid assets to satisfy your liquidity needs then you can earn a higher return on your other assets.

Question

Quizplus · Accepted Answer

It is important to have enough cash or liquid assets to satisfy your short-term liquidity needs, such as unexpected bills or emergencies. However, keeping too much money in low-earning liquid assets can result in missed investment opportunities and lower long-term returns. It is generally recommended to maintain an emergency fund of 3-6 months of expenses, and invest the rest in assets that offer greater potential for growth.

You Should Maintain Just Enough Money in Liquid Assets to Satisfy