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Highly Liquid Investments

These are investments that are quickly and cheaply converted into cash, or are in cash already.  Examples of highly liquid investment include:
  • The balance in a savings or checking account 
  • A wad of dollar bills stashed in your mattress 

Stocks, bonds, CDs, and Mutual Funds are all considered highly liquid investments.  They aren't quite as liquid as cash itself, but without too much trouble, each could be quickly converted to cash.

And, just in case you aren't exactly sure what is the definition of stocks, bonds, CDs, or mutual funds, take a look at the section on Investment terms and concepts to brush up.  

Whether you should invest money in any (or all) of these different types of liquid investments depends on different factors, which are discussed later (in a section called "Deciding How to Allocate"). 



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