Dave Ramsey: This Is the Safest Way To Keep Millions

It might be your business or personal goal to accrue millions of dollars , specifically in cash. Business owners with significant cash flow numbers, especially in fields like construction or commercial real estate, often attain this goal. Yet having that much cash on hand comes with another problem — where to keep it.

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A business owner might need several millions on hand for a project, so they need the funds to stay liquid and can’t invest it.

Your first thought might be to put the money in a bank. However, FDIC limits only protect up to $250,000 in cash, and $500,000 for joint accounts. You don’t want to risk that money. But finance expert Dave Ramsey offered some surprising advice in a recent YouTube video .

“I’m not worried about the FDIC protection,” he said. “What I want to deal with is a bank that’s solid, because FDIC protection only comes into play if the bank fails. I want to deal with a bank with solid financials. I don’t want [to put] it all in one bank, but I don’t want it in 16 banks, either, trying to hit the FDIC limits.”

When choosing a bank, Ramsey said he doesn’t want to work with a small start-up, but also doesn’t want to work with a mega-bank like Bank of America. “I deal with regional banks that have strength,” he said, adding that his cash is typically spread between two or three banks.

When possible, he tries to put his cash reserves to work for him. He has negotiated a float, where funds sit in a money market account earning 1% interest until they are needed. “We’re seeing as much as 1% extra, and that’s a lot of money. It’s still very liquid.”

He added that if he has cash he won’t need to touch for three years, he’ll place that in a mutual fund to earn 10% interest. “If you’re sitting on $10 million and you’re not going to need $5 million for five years, take 3 of that and put it in a growth and income, low-turnover, mutual fund and let it ride the market,” he recommended.

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This article originally appeared on GOBankingRates.com : Dave Ramsey: This Is the Safest Way To Keep Millions