MBA2157 How Much Cash Should You Always Have in the Bank? + Free Ride Friday
The $100 MBA Show
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How Much Cash Should You Have in Your Bank Account?
The ideal amount of cash you should have in your bank account is six months six months of your expenses. Most startups small businesses bootstrap businesses simply can't afford to have 12 months of runway or one year of burn in their bank. The reason why I prefer six months over a year is because that's a lot of cash to have on hand and of course this will be seen as a surplus of cash in your business which you'll have to pay taxes on.
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