Interesting thoughts but I would actually go the other way: liquidity is mostly useful if you know when to deploy it (and become illiquid). Everyone thinks they have the guts to do in the middle of crisis but I doubt many (any?) of us actually do. Just as a simple test: the markets crashed in January/Febuary of 2016. Did you (I mean “you” in the general 3rd person, not just OfDollarsAndData) sell bonds and buy stocks? Did you use your HELOC to buy stocks? Did you increase your 401(k) contribution to the max those months? That was the greatest buying opportunity of the past ~5 years. You would have had a ~30–40% return in 18 months. If you missed that…when WILL you act?