How much debt are you comfortable with? How much of a cash buffer do you need? I've been wondering about this recently. I know being aggressive can get you greater returns, quicker. But at what cost? For instance, I know someone who earns a decent wage, and is able to borrow 90% without LMI due to the nature of his work. He doesn't have much cash savings (has around 5 - 10x monthly outgoings) but has a lot of equity in his IP(s). He can take LOC's to buy more IPs (I think, no money down? Pays deposit plus buying costs with LOC) or to invest in shares. Hasn't hit serviceability limits yet either, and probably won't for a number of years to come. Most of his cash is in (reasonably blue-chip) shares or ETFs. If you were in such a situation, what would you do? Gear up as much as possible and invest? He's got no dependents and his job is pretty secure; I'm assuming if one had less job security (as do I, being self-employed), you'd want a greater cash buffer, and more cash if you had dependents. Also, because I'm new to the concept of "good debt", it's personally a bit nerve-wrecking for me to consider having only a tiny bit of cash on hand, and gearing up to invest!