2. Keep at least a year of expenses set aside: You want to set aside at least a year’s worth in cash for what your expenses would be in the year. This is in addition to any income you have coming in from say a pension or Social Security. Then put that cash in a very safe and liquid place; for example: interest checking or a saving account, T-bills or market money funds. You want to be able to access it quickly if you would need to. Now it also needs to be realized that this is not practical for people with little money. But that doesn’t mean you shouldn’t have a ready to access nest egg regardless of some amount.