Cash is King Meaning
Definition: It’s best to keep one’s investment money in cash.
This phrase is used when the price of securities or other investments are high. If the market is high, it’s best to build up cash as wait for a break in the market to invest.
Additionally, this phrase is sometimes used to indicate that cash carries more weight in purchasing than other forms of payment. For instance, buying with cash is often preferred to paying with credit.
Origin of Cash is King
The exact origin of this expression is unclear. However, it became much more popular in the latter half of the 1900s. Most likely, king is a substitute for supreme importance.
Examples of Cash is King
In this dialogue, a brother and sister are arguing over their finances.
Maria: Franco, did you take all our savings and put the money into real estate?
Franco: Yes, I did. It’s a very good investment.
Maria: I’m not saying it’s a bad investment.
Franco: Then what’s the problem? You seem upset.
Maria: Well, haven’t you ever heard the expression cash is king?
Franco: Yes, what is your point?
Maria: Well, the market is quite high right now. We should keep some of our money easily accessible in cash form. That way, when the market dips, we can get it quickly.
The second example shows two university students discussing the experience of buying a car.
Lorenzo: Have you ever bought a car?
Alba: No, why?
Lorenzo: Well, I have really good credit, but I’m having trouble getting any dealership to sell to me.
Alba: Did they say why?
Lorenzo: Every time I see a car I like, someone else with more cash on hand buys it before I can. The car dealers said that cash is king.
This excerpt is about young people who borrow money from their parents. This is because buying a home is very competitive, and real estate agencies prefer to have cash immediately whenever possible.
“Cash is king in this market and that makes it extremely difficult for first-time homebuyers,” said AnneMarie Tamis-Nasello, a broker with Douglas Elliman. “It’s the first thing sellers look at. They go right to the all-cash offers.” –New York Daily News
The below article excerpt describes how residents in one area did not have easy access to ATMs. This is a big problem because it is very important to be able to get cash.
Jonathan Gaska, district manager of Community Board 14, said they have been asking city officials and representatives from financial institutions to put secure ATMs at several locations in the area.
“In situations like this, cash is king and people need access to it,” said Gaska. –New York Daily News
Cash is king means that having easily accessible funds when the market dips is important.