Building Operational Reserves for your Non-Profit

The 2019 pandemic caught everybody by surprise.  For many, it was a period of struggle, isolation, loss, and chaos.  Many businesses were hit hard and even had to close.  Others were able to bounce back, and some are still struggling. 😞

One thing we can learn from this is that it is best to be prepared.  For non-profit organizations, this means having operating reserves.  Think of this as a rainy-day fund or an emergency fund.  Having this will help alleviate some stress when the unexpected happens.

These extra funds can come from a variety of sources.  They can come from

▶️Donations

▶️Surpluses

▶️Unrestricted Funds

▶️Selling of Assets

If you are a non-profit and do not have operational reserves, the first step is talking with your Board of Directors about building one and putting a plan in place to do so. 

While things are better now, you can use this period to prepare. You want to dig your well before you’re thirsty, not when you get dehydrated.