Cash Management Strategy
“Cash is king. Get every drop of cash you can get and hold onto it.”
Jack Welch, Chairman and CEO of General Electric
Historically during times of market uncertainty, real estate clients have generated a significant amount of cash reserves. And while sitting on large piles of cash is never a bad thing, not putting that cash to work might be.
If last you checked, your operating cash was earning something like 0.5%, it’s time to re-evaluate your cash management strategy. The investment landscape has changed and so have the investment products. Through early-April, the yields on U.S. treasury notes/bills, Money Market Accounts and other short-term fixed solutions have significantly exceeded those of traditional checking or savings accounts. And those margins don’t even take into account the potential (Federal and State) tax benefits of certain short-term investments. The opportunity to invest your large cash balances, while preserving precious liquidity, could be a win-win for any real estate client.
CLA Wealth Advisors, LLC wants to help. Please reach out today to learn more!
Thanks to Omer Abramovich and Brandon Knight for their help with this post.
- Carey M. Heyman, CPA
- Managing Principal of Industry - Real Estate
- CliftonLarsonAllen LLP
- Century City (Los Angeles)
Carey is the Managing Principal of the Real Estate Industry at CLA. He is a trusted advisor with close to 20 years of experience providing accounting, assurance, tax, and consulting services to real estate industry owners, operators, family offices, developers and syndicators. Carey has a strong track record of helping clients build and retain capital by leveraging tax- and cost-saving strategies and employing tax credits and incentives. He also consults with high net worth individuals, large family groups, and owners of closely-held businesses on all aspects of tax planning, estate planning, and retirement planning.
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