We have had cash on hand since Y2K, which became 9/11 cash, then 2008 crash cash. I agree with the author to be careful, because depositing/withdrawing or spending large amounts of cash can trigger a report to the authorities due to the Patriot Act, or cause other problems.
My own example is: In 2008 I withdrew $7,500 and closed an account at a failing bank. This money sat “under the mattress” so to speak, until just a few months ago when I decided to purchase a small second home, using this cash as part of the down payment. I had about $5,000 left of the cash and put it in my current bank account so the mortgage company could “see” the money to be used for the down payment. (The teller indicated that $10,000 was the reportable level.)
However, since my cash deposit was within three months of its planned use for the down payment, the mortgage company would not let me use it! All funds must be completely trackable, not cash, due to the Patriot Act. Even though I had banking records documenting my old bank closure and withdrawal, they would not accept this money in down payment. I was forced to obtain a money gift (completely documented as to the bank it came from,etc.) from a relative to get approved for my mortgage.
I don’t know what would happen if I tried to buy a vehicle from a dealer with cash over $10,000 – it likely would be reportable.
Cash purchases, even smaller amounts, are becoming more restricted in Europe. And the Cyprus great depositor rip-off increases the risks of banking your money. Credit card purchases are set to be mined and monitored by the US government, I have read. We are between a rock and a hard place.
Here is some of what I have done for financial preparedness:
1. Transferred all of my IRA in 2009 from a big institution to a Self-Directed IRA (Unless you are very savvy, you must get a custodian – Entrust is a well-known one.) This enabled me to put my IRA into rental real estate, with an associated small bank account to receive rents and pay for expenses. I have chosen not to have precious metals in this IRA, because you cannot have custody. There are many other investments you can make through a self-directed IRA.