I am a freelancer with a very irregular income. Sometimes I spend months without a job; sometimes, I earn 3x more than a salaried person.
I want to have 10K USD at minimum in my bank account all the time. I spend $1500 per month. Let's make it $2500 per month to cushion unexpected expenses.
So I figured that I should keep 10K + (2500 * 3) = 17,500K in my bank account right now and then invest 7500 with 3-month maturity, another 7500 with 6-month maturity and so on until I run out of liquid savings. This way, I will never run out of cash, even if I have been jobless for years.
Am I doing it right?
How do I account for inflation-related increases in expenses in the future?
I think it will be a really high bond ladder but still it won't invest in 20 year bonds which have the highest return usually (I know current situation is exception). How do I design bond ladder to invest in long-term bonds too.
[link] [comments] https://www.reddit.com/r/stocks/comments/123weyg/how_to_create_a_bond_ladder_for_my_particular_case/
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