Living expenses

If an investor wants to keep 6 months of living expenses on hand, would that be considered a part of the investable assets?

No. These should not be taken as a part of the investable assets. This is like an emergency reserve that the invester would want to maintain at all times in cash.

Okay that makes sense. However, Schweser page 256 takes the investable base as 2M.

Am I missing something?

Removing them is optional according to the CFAI test answers I’ve been taking

I would remove them from the investable asset base. It is essentially cash, so forms part of the liquidity section of the IPS. If you are asked to select the correct portfolio from a A,B,C or D then you can rule out ones with a cash amount less that the equivilant of 6 months expenses.

Keep them in the asset base but increase your allocation to ‘cash’.

A liquidity reserve is different than a liquidity need.

According to 2013 AM Q1A answer, seems both way are fine.