A retiree in Israel recently sold his Jerusalem home and deposited two million shekels into a bank account. He kept additional cash at hand for potential family assistance, unsure how best to handle the funds long-term. When we spoke, he admitted he felt stuck, worrying about making the wrong decision with the money and choosing to park it safely for now.
This reflexive move – a temporary solution quickly turning into years of low-yield deposits – is common among Americans living in Israel after significant financial transitions. Uncertainty often makes cash feel like the safest option, but this instinct can carry hidden risks over time.
Liquidity has its limits
For the short term, prioritizing liquidity makes sense. This client secured funds for family support and upcoming expenses, ensuring financial safety. But holding significant cash indefinitely exposes money to inflation, especially in Israel, where living expenses steadily increase. Deposits earning modest returns struggle to keep pace, eroding value over time.
It’s not about rushing into investments or taking unnecessary risks. The issue lies in treating cash as a default rather than considering its purpose. Eventually, the need for long-term planning outweighs the comfort of accessible funds.
Pairing purpose with strategy
This client’s larger positions remained in U.S. IRA and trust accounts. He had no short-term spending plans. Allocating a portion into stock index funds aligned better with his timeline and goals. This wasn’t about chasing returns, but matching the risk level to the money’s purpose. Long-term funds don’t belong tied up in savings accounts or money market funds for years.
Understanding what you’re saving for clarifies decision-making. Emergency money stays liquid, while growth-oriented investments build wealth. If you’re holding substantial dollar or shekel balances but feel uncertain, reviewing options with a financial professional can ensure your money supports your future goals.
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Douglas Goldstein, CFP® is the director of Profile Investment Services, Ltd. www.Profile-Financial.com. He is a licensed financial professional both in the U.S. and Israel. Call (02) 624-2788 for a consultation on how to set up your American assets to meet your financial goals. Securities offered through Portfolio Resources Group, Inc. Member FINRA, SIPC, MSRB, FSI. The opinions expressed are those of the author and not those of Portfolio Resources Group, Inc. or its affiliates. Neither PRG nor its affiliates provide tax or legal advice.
Published April 7, 2026.