Idle cash above the floor, swept to T-bills

Every household sets a cash reserve with its advisor: the amount it wants to keep in checking or savings, no matter what. The morning pass leaves that money alone. What it watches is the cash above it.

When a balance stays above the reserve for more than nine days in a row, the pass drafts a move to a Treasury money fund in a managed account. Nine days is long enough to ignore a paycheck that is about to pay a credit card, and short enough that a bonus or a sale does not sit for a quarter earning almost nothing.

For business owners the logic runs both ways. The pass knows each estimated tax date and the household’s expected payment, and about two weeks before each one it drafts the reverse move, back to checking. The owner’s reserve also changes with the business: we raise it after a weak quarter and lower it when contracts are signed.

Sometimes the right answer is to leave the cash where it is: a house purchase in March, a tuition bill in August. Tell your advisor, and the pass will skip that balance until the date you give.