While some people like to keep cash on hand for emergencies, how much is too much?
Bill from Illinois called into The Ramsey Show out of concern for his wife, 64, who wants to keep $75,000 in cash at home in a safe, which would make her feel “comfortable.” (1)
“Of course, being her husband, I want to make her comfortable,” the 62-year-old co-hosts George Kamel and Jade Warshaw.
His wife’s hesitation with banks goes back a few years. Her father was placed in a nursing home in 2021 and passed away in 2024. With no savings or estate plan in place, the state audited his assets, forcing her to painstakingly track every penny he had spent over the previous three years.
“So she’s just sick of dealing with banks,” said co-host Jade Warshaw. But what Bill described, Warshaw added, is really the result of poor estate planning — plus a dose of government bureaucracy.
There’s more risk in keeping that money at home than in a bank account, said co-host George Kamel. The cash could easily be lost to theft or a natural disaster like a fire or flood.
She’ll also lose out on compound interest with “inflation eating away on the buying power versus having it grow in a high-yield savings account,” Kamel said.
But Bill’s wife isn’t alone in wanting to stash cash. A study by Piere, a financial management app, found that the average American keeps $544 in cash and valuables, such as bullion and precious gems, hidden around the house — in freezers, secret compartments and even under floorboards. (2)
While 10% of Americans keep cash in a safe, 6% keep it under a mattress or pillow and 5% stash it in the fridge or freezer.
The reason? The study pointed to a lack of trust in the economy as a major factor driving some Americans to mattress-stuffing to “protect their wealth outside of the traditional banking system.”
A 2023 FDIC study found that 4.2% of U.S. households — about 5.6 million — were unbanked, meaning no one in that household had a checking or savings account. Of those, 15.7% said they “don’t trust banks,” the second-most cited reason for avoiding them.
“The resurgence in mattress stuffing isn’t some whimsical trend. It’s a sign that many Americans feel uneasy about the financial system and are searching for something they can trust,” said Piere CEO Yuval Shuminer in a release.
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Mattress stuffing might feel safer, but it comes with serious downsides. Cash can be stolen, misplaced or destroyed in a fire or flood. Homeowners insurance may cover cash and bullion, but the protection is usually limited to a small amount.
And while you might be worried about the economy, cash hidden at home won’t keep up with inflation — especially if it’s sitting next to the frozen chicken.
Think of it this way: cash under a mattress earns 0% interest. When you factor in inflation, your money actually loses value over time. Plus, high-interest savings account (HISA) deposits are protected by federal insurance, covering up to $250,000 per account, per insured bank.
Other options include a certificate of deposit (CD), which locks in a fixed rate for a set period, or a money market account, which blends features of checking and savings accounts.
In Bill’s case, the bigger issue is estate planning. That means helping his wife understand that “what happened in the past is not going to happen in the future,” Kamel said, because they’re setting up their life in a very different way than her father did.
Bill also worries about putting his wife in a tough financial spot if he ever needs long-term care.
But state spousal impoverishment laws are designed to ensure that if one spouse needs Medicaid-funded long-term care, the other will still have enough income and assets to live comfortably.
Kamel recommends that Bill and his wife work with an estate planning attorney to walk them through this process. Having a professional explain what will — and won’t — happen in the future could give his wife the “critical confidence she needs.”
That doesn’t mean she can’t keep some cash at home — just not all $75,000. Financial experts typically suggest keeping no more than $1,000 in cash on hand at home for emergencies — and storing it in a waterproof, fireproof safe.
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The Ramsey Show (1); Piere (2); FDIC (3); Weaver Insurance (4); Illinois Legal Aid (5.
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