Warchest never seems enough....

[NorthWestPerm2Contr]

At what point do you really start to relax when it comes to warchest?

When I first started my aim was to go to 10k, then I felt that wasn't enough so it became 20k then 30k and now I am thinking 40k absolute minimum......

Having less than 40k in the business account would now cause me serious stress.....

So when does it stop?

[SimonMac]

At what point do you really start to relax when it comes to warchest?

When I first started my aim was to go to 10k, then I felt that wasn't enough so it became 20k then 30k and now I am thinking 40k absolute minimum......

Having less than 40k in the business account would now cause me serious stress.....

So when does it stop?

I go for time rather than money, 12 months basic expenditure, as my average spend increases so does my warchest.

[bobspud]

At what point do you really start to relax when it comes to warchest?

When I first started my aim was to go to 10k, then I felt that wasn't enough so it became 20k then 30k and now I am thinking 40k absolute minimum......

Having less than 40k in the business account would now cause me serious stress.....

So when does it stop?

I think its down to your attitude to risk. I am happy with about 3 months worth of money knowing that that I can make that stretch to 4 in a true crisis... The worst I have ever needed was four and a half months and that was dire in october 2008

[zoco]

I go for time rather than money, 12 months basic expenditure, as my average spend increases so does my warchest.

You may have the money to spend but don't you worry that you need it set aside in case of an IR35 fail?

[northernladuk]

I go for time rather than money, 12 months basic expenditure, as my average spend increases so does my warchest.

This!! My 6 month warchest was considerably smaller 5 years ago than it is now lol....

6 months to live the life I live now and 6 months with cutbacks and I am a happy man.

10k warchest? That isn't a warchest! That is the bare minimum needed to cover your obligations if a client missed a month!!

Funny thing with a warchest though, I can't take enough out of the business to stay under the tax threshold anyway so it naturally keeps growing. What do other people do when their warchests hit their expected levels? Just stop worrying or have they got some super duper way to get the rest of the cash out? Guess I am not aggressively avoiding tax with divis to wife etc though.

[Old Greg]

2 years' mortgage, council tax and utilities bills.

[northernladuk]

Also I don't dip in to my warchest to fund new houses or anything as well so don't need to stress as much as you would. My warchest is for bench time not for projects that run out of cash

[Bunk]

If it's in the business account I don't class it as warchest. Only once it's out, in my personal account and any personal tax paid do I count it as in the warchest.

[northernladyuk]

This!! My 6 month warchest was considerably smaller 5 years ago than it is now lol....

6 months to live the life I live now and 6 months with cutbacks and I am a happy man.

Funny thing with a warchest though, I can't take enough out of the business to stay under the tax threshold anyway so it naturally keeps growing. What do other people do when their warchests hit their expected levels? Just stop worrying or have they got some super duper way to get the rest of the cash out? Guess I am not aggressively avoiding tax with divis to wife etc though.

You slag!

[sasguru]

Don't really need a warchest as no mortgage, but am very frugal so its grown to an extreme amount this year.
Tighter than a nun's wotsit, me.