If most of your net worth is tied up in illiquid assets, can you be “wealthy” but still financially fragile? How much liquidity should someone maintain when their income is also unstable?

• Wealthy on paper, but financially fragile. Asset-rich, cash-poor. When income is unstable, liquidity serves as a shock absorber to smooth out cash flow rather than a mere emergency fund.

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• General guideline: 20% of your net worth should be held in liquid assets, split among cash, SSBs, T-bills, and stocks.

I don't think that's true wealth. Real, tangible wealth is having cash on hand that you can actually hold onto, the kind of money that can support any idea or dream you have. When your income is unstable, you should keep your cash in circulation to cover expenses in case of income gaps or high spending. Flexible investments or savings are both good options.