UBS On-Air: Market Moves Top of the Morning: Building and refilling the Liquidity strategy
May 15, 2025
Discover the vital role of a liquidity strategy in weathering market fluctuations. Learn practical steps for setting aside resources for financial stability over the next few years. Explore how timing plays a critical part in managing liquidity needs and asset allocation. Dive into the importance of customizing your strategy, especially for those entering retirement, balancing expenses and investment growth. Plus, find out how family goals can shape financial strategies with tailored advice from experts.
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Fund Your Liquidity Strategy
- Set aside three to five years of spending needs in liquid assets to cover essentials during market volatility.
- This approach protects your financial plan and provides peace of mind against market downturns.
Refill Strategy When Markets Are Healthy
- Refill your liquidity strategy annually by reviewing past spending and predicting future expenses.
- Do this refill when markets are healthy to avoid selling investments at a loss during downturns.
Calculate Appropriate Liquidity Amount
- Determine liquidity needs based on planned withdrawals over the next three to five years, adjusting for income and major expenses.
- Regularly review and update your spending estimates with your advisor to ensure accurate liquidity funding.