Here is an overview on how you should think about cold hard cash.

Cash Buys Time: Simply put, you can use cash to buy yourself time. It can be as simple as a convenient store and parking to as impactful as elongating your life. If you meet anyone who disagrees that cash does not buy time, you can be certain they have never seen a loved one die in a hospital due to lack of top tier medical treatment. No matter what, we will use time to acquire cash of course, but do not forget that the reverse is also true. Hence the phrase “Time is Money”.

Hint for younger guys, if you waste someone’s time they are not going to like you. This will happen faster than you think in a good way or… in a bad way.

Cash is Not an Investment: We have said this many many times, cash in a bank account is deflating in value by ~3% per year. Regardless of what the CPI is saying, your opportunity cost is simply CD’s and 10-year bonds. So in reality? It’s probably closer to a 3-5% net loss per annum. If you believe cash is an investment don’t listen to us… Listen to Warren Buffet.

Cash Flow is King: From the video clip above you can tell there is a clear and implied message. Cash flow is king not cash. As a simple example, if someone tells you they have a net worth of $1M and make $2,500 per month from their profession are you impressed? No. Now if someone says they have monthly cash flow of $50K and a net worth of $500K… You’re going to choose to be person number two. Why? It means you can continuously reinvest into other opportunities.

Take this to a personal finance perspective and apply it to your own life. Before you buy/invest in anything you should have a clear idea of how exactly you’re going to turn the position into a cash flow positive event.

Cash is Ammunition: Hate to refer to the video again, but if you listen carefully he says “we will always have cash around but anytime we have surplus cash around I am unhappy”. Therefore, the second implied message is to create a minimum cash balance and find a way to invest the rest.

Lets take this to a personal finance level again. If you have money sitting around for longer than a year then this money absolutely needs to be opportunity money. You’re losing 3-5% per year so you better have a rolodex of possible ideas coming your way.

Cash Makes Friends: Most people believe having cash makes you have the “wrong friends” and that you’ll find out who your *real friends* are. In reality, the first idea is completely and utterly false and the second idea is absolutely true. When you finally make it in life, the people who clap and congratulate you are going to be your friends for life. The ones that beg you to help them and the ones that say you don’t deserve it or become jealous… Go ahead and cut them off. Their loss anyway.

You will be surprised at how the cards play out. Don’t worry about the one time drop in friends, you’ll end up making many more friends because successful people all share a similar mindset.

Cash Makes You a Lot Happier: We have said this a million times, but it will be a short bullet here. Anyone who says it doesn’t matter is either excruciatingly rich (0.001%) or broke. Play the odds and you know you’re likely listening to a broke person when they say money doesn’t matter. The fact is, real cash allows you to do anything you like. Re-reading point 3, you are only well off if you can survive off of cash flow from investments and maintain a happy lifestyle.

This makes it incredibly obvious as to why it makes you happier. You don’t have to do anything you don’t want to do. So when you hear that all rich people are fat and unhappy, you can just go back to the classic move… Smile, nod, agree and ignore their future requests to meet.

Cash is Not a Cure: It takes many years to realize this, but one single thing will never fix your life. Even though it solves hundreds of issues for you, there is literally not *one* thing that will make you entirely happy and cure all of your problems. In general, happy people have the following qualities: healthy, positive social life, positive sex life, work they enjoy and no financial issues. In short cash is not a cure but it knocks out two important ones, health and financial issues.

If you can read between the lines here, the one thing that comes close to being the cure for happiness (if you’re depressed)? Yep you guessed it, Game.

Cash Creates Baseline Trust: If you had to ask someone to watch your bags at the airport, would you choose the unshaven backpacker or the man in a high-end business suit responding to emails on his phone? Naturally you choose the person in the suit. The reason why cash creates trust is related to point 6, if someone has money they have no interest in taking anything from you because they don’t need to. Go find a wealthy neighborhood… then go find a poor neighborhood… then ask yourself… Do I trust the people that surround me?

For the astute reader, you’re going to realize you feel slightly uncomfortable asking the man in the suit to watch your bags compared to the questionable unshaven young man. Why? You realize his time is valuable.

Cash Makes You Mean: It took several years of work experience to understand the phrase “the truth hurts”. What does this phrase mean? It means if you are direct or blunt with people they will be offended because most people want to hear fairy tale pick me up stories instead of the truth. When you become successful you’ll find they have one dangerous quality. If they like you, they will tell you how it is for better or worse.

So before you become upset when you dislike the advice given by a wealthy person… ask yourself… Did he/she tell me the truth? The real world is much much tougher than a few words of advice from a stranger.

Cash Makes You More Attractive: You can interpret this in many ways and in practically every way you’re going to be correct. Unless you have honestly lost your mind, you’re going to choose to hang out with a wealthy individual when compared to a broke individual. All else equal.


Summary Remarks: Hopefully you now know everything you need to know about cash. 1) it doesn’t buy happiness, but it helps a tremendous amount, 2) it is not an investment, 3) money buys time, 4) cash gives you a level of trust and 5) cash allows you to decipher your social circle.

Now instead of hating it, lets find a way to get more of it to hand to people we like.


  1. amy watkins says

    Thank you WSPB for the points. For years i think abt the same but many ppl, including the main stream media hold different view, i.e. “rich ppl are fat & unhappy”. If they are unhappy, then why everyone wants to become rich right? 🙂

    Regarding investment, would you consider managing the investment yourself (e.g. managing the buy/sell yourself) or would you pay a fund house to manage for you?


    • Wall Street Playboys says

      You should manage your own money. It makes even less sense to allow someone else to manage your finances given a career on Wall St.

    • Wall Street Playboys says

      This is a sliding scale as you age, but here are some rules of thumb

      1) everyone needs at least 3-4 months living expenses that is baseline
      2) every year that passes add 1 month extra to this, assuming you started earning income at 21 this means by 25 you should be closer to 7-8 months or so
      3) You always get your employee match on your 401K every single year, so if the world really does end at least you have that as well

      Anything beyond this level and its generally surplus cash. The only exception is if you’re currently looking for a new investment opportunity but most aren’t at that net worth level yet.

  2. New to game says

    Does this mean you should use cash to pay at a bar to save time? I just started working in NYC and am learning the night scene.

    • Wall Street Playboys says

      Yes you should stick with cash because of the following:

      1) you can leave an immediate tip (ie get the bartender to like you in a crowded area)
      2) you are saving the bartender time because he doesn’t have to start a card/run a tab
      3) you are saving yourself time from waiting around for the signature process
      4) you will be moved up in the queue if the bartender is certain you’re paying with cash

      We suggest you read our fun, yet truthful post on game being a category in jeopardy

  3. cash says

    what does this sentence mean. don’t really understand it. “If you can read between the lines here, the one thing that comes close to being the cure for happiness (if you’re depressed)? Yep you guessed it, Game.”

    • Wall Street Playboys says

      Most people are unhappy.

      They think being rich will solve it and are wrong.

      Cash solves a lot of issues but is not an end all be all.

      “Game” really solves the vast majority of unhappiness. Game is social skills and physical work. So an in shape person with good social skills in general will be happy. So if you are unhappy your first step is to fix your social life, sex life and physical well being. Cash is essentially a turbo booster.

      If you’re driving a beat up honda, there is no point in the boost. When you’re in a porsche… it makes more sense.

      Edit: Do not get this confused. If you are young your career or business comes first, you have more than enough energy to improve social skills at the same time.

      • a says

        I learned game in college first and let my grades drop slightly. Downside is I had to study a little harder. Upside is I now have game for the rest of my life.

        It really takes 3-4 years to cultivate solid game. You really need to get to a point where you just stop sucking terribly and it becomes slightly fun. From there it’s all downhill. First 1.5 years were painful but after that I sucked but it was still fun.

    • Wall Street Playboys says

      Close but no.

      Any surplus cash should be appreciating in value over the long-term and a bank account does not count. The video explains this, his answers are great for the 2 minutes posted on here.

      No one gets rich on the stock market with a $100K e-Trade account.

      • John says

        There is not much else you can do other than stocks if you are stuck in a cubicle 9-5. I would be pretty comfortable having 300k in my account and live off of the 10% appreciation a yr. I think I can live comfortably in SEA.

      • Wall Street Playboys says

        If all you need is $300K you should honestly switch careers. You’d only need to make $100K per year for about 5-6 years and save aggressively to achieve that goal.

        But that’s unrelated to the original topic.

      • Anon. says

        Based on this, do you guys have an opinion on the Early Retirement Extreme and Mr. Money Mustache crew (i.e. high savings, low expenses for life)?

        I’m imagining you don’t have anything actively against them or what they preach, you just live categorically different lives based on your values.

      • Wall Street Playboys says

        We don’t read either of those blogs but we have read them in the past.

        In short if they are happy with their decisions then good for them.

        Our opinion is that retirement is just a scam, it sounds like neither of them loved their professions so they retired and did something they enjoy on the side which is the smart move. Again as we have said, if you’re financially free you don’t do stuff you don’t have an interest in so you’re seeing that ring true.

  4. Rob says

    Do you think market will suffer a correction in the near future? If so, would you advise waiting to get in until that happens?

    • Wall Street Playboys says

      We do not play god.

      We may have to add this to the ask us anything section. Anyone who asks “where is the market going” is likely going to get emotional with their investments and can’t stomach a 40% correction.

      If the market moves up or down 25% in the next 6 months it will literally change nothing.

      • Rob says

        Thanks for the reply. I take what you say seriously. “They” keep saying the market is in for a big correction. Seems like everyone is saying so. It’s not an emotional thing (with me anyway). It’s a, “I have nothing invested, why not wait 6 months until the correction” thing.

      • Wall Street Playboys says

        Go back in news articles exactly 6 months ago and let us know what the predictions were for the next 6 months.

        Again if your time horizon is less than 5 years you’re playing the wrong game and will lose.

    • Wall Street Playboys says

      It has honestly gotten a bit out of hand at this point. Going to think about how to write in the future because the audience is mixed into type A wall street people and young guys in their 20s who are trying to figure everything out at once.

  5. Chris says

    As a counterpoint, I believe it was also Buffet who said that holding cash, while losing money value due to inflation and opportunity cost of other investments also has, for lack of a better term, an opportunity “value” in that if a great deal comes your way, you are able to buy in. His point was that holding cash is similar to a call option. For instance, if you have a million in the bank, and stocks drop 50% like 2008, your cash allows you to buy in a firesalen prices.

    • Wall Street Playboys says

      Not sure what you mean here. Again as stated

      “surplus cash is bad”

      Surplus cash implies you have two baskets of cash. 1) emergency fund and 2) opportunity fund.

      Once you have both the rest needs to be invested 100% of the time. This is exactly what pint 4 is referring to, cash is ammunition.

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