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How much is holding cash costing you?

Meet with one of our expert advisers to find out.


*Assumes £2m investment portfolio at age 40 and £1m annual income. Other assumptions: current UK tax rates and conservative investor retains 75% of surplus income in cash. Efficient investor invests 100% of surplus income in investment portfolio. Y TREE market modelling of a 70% equity, 30% bond portfolio.


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How much is holding cash costing you?
Meet with one of our expert advisers to find out.

Welcome to Y TREE

Please fill in your details to discover a data-driven analysis of your money and life.

The cost of being complacent with your cash

It’s easy to be complacent when it comes to your excess cash. There’s a lot to think about: how much should you hold on to for life’s uncertainties; what large expenses are coming up; should you wait for a market correction before you invest in the stock market? Work and life can be hectic and we often postpone these decisions - sometimes for years.

But a career’s worth of inertia could cost you 7 extra years of work.

So, why are people often complacent with their cash?

The psychology of conservatism

Holding cash feels comfortable. There’s safety and security in having a healthy bank balance to fall back on. 

This is linked to our cognitive bias for loss aversion: many studies show that the pain of losing feels psychologically twice as powerful as the pleasure of winning. When we think there is a chance we might lose in the short-term, we exercise caution. It feels better to be conservative and maintain the status quo than to take the risk. 

But, holding cash is, in itself, a choice. And it’s a risky one, particularly over the long-term because you may need to grow your capital, ie work more, to sustain your lifestyle. 

Understanding the environment

Inflation has been low and stable over the past few decades. Having cash in the bank hasn’t been too much of a problem because its value hasn’t been eroded by inflation.

Now, things have changed.

The current economic environment - characterised by high inflation, increased interest rates, volatile equity markets and even higher taxes - means that holding onto cash could prove very expensive. 

As Einstein said: "compound interest is the eighth wonder of the world. He who gets it earns it; he who doesn't pays it."  The compound impact of inflation can dramatically erode our ability to sustain our lifestyle, particularly in an age when we are expected to live well into our 90s.

How to manage your financial life like an institutional investor

At Y TREE, we take a systematic, unemotional approach to managing your risk and liquidity. We always ensure that you have a safety net for the unexpected. 

Any cash you hold above that buffer should be put to work. Meanwhile, our technology continuously monitors and manages this process so you don’t have to. 

In other words, we remove human inertia from your financial life. We want to maximise the efficiency of your balance sheet, giving you time back to spend on the things you value most. 

Making the most of your liquidity is one of multiple, marginal gains we create across your entire financial profile – risk mix, liquidity, currency, cost, structuring. Each little win compounds to significant value over time. 

These efficiencies give you time you never knew you had. Time to spend on the things you care about most - children, businesses you’re passionate about, travel, retirement, house renovations, philanthropy. It’s up to you.

We are bringing money back to life.

The value of investments as well as the income derived from them can go down as well as up and investors may get back less than the original amount invested. Changes to the macroeconomic environment may alter the results of this analysis. These figures are projections and are not guaranteed.


The benefits of the Y TREE approach



  • An up-to-date view of your entire financial life in one place
  • Independent analysis of your investment performance, risk and all costs
  • Perspective on your currency exposure, liquidity profile and debts


  • Personal targets for your risk level, currency, cash balances and liquidity
  • Institutional processes generating multiple, incremental gains across your financial life adding up to considerable value over time
  • Our technology and approach saves you hours of time


  • Our financial life strategies mean some of our clients can afford to retire earlier without any change in lifestyle
  • Many of our clients can reduce the risk they need to take to achieve their aspirations, giving them greater security and peace of mind in turbulent markets
  • Some of our clients can fund their children’s private education, family holidays or gifting for the year through fee reduction alone

We solve 5 key personal finance problems

1It’s difficult to keep track of your finances


  • Our technology pulls together all the elements of your financial life
  • Automated data feeds with leading private banks and wealth managers
  • Instantly accessible via our intuitive App

2Reports from wealth managers are complex and difficult to compare


  • Independent assessment of risk, performance and fees
  • Understanding of key capital market drivers
  • Forensic analysis of your income, expenditure, assets and debts

3The industry focuses on investment performance not life


  • Sophisticated engine balances your money and your life
  • Constantly evolving strategy based on your aspirations
  • Flexibility to navigate changes in personal circumstances

4Financial products and acronyms are difficult to understand


  • Comprehensive advice on risk, currency, cost, liquidity and tax
  • Your dedicated team of expert advisers
  • Available 24/7 via our encrypted chat

5Wealth managers are remunerated for selling products


  • Access to processes used by the world’s most sophisticated investors
  • Multiple marginal gains compounding to significant value over time
  • Ongoing assessment to keep your life aspirations on track