4 tips for rebuilding your operating reserves

Description

Abstract: The COVID-19 pandemic has driven home many lessons for nonprofits, perhaps none so much as the importance of operating reserves. This article provides some steps nonprofits with dramatically depleted — or nonexistent — reserves can take to remedy the situation, including achieving leadership buy-in, committing to a formal reserves policy, developing a funding plan and being realistic about the amount of time it takes to build or replenish operating reserves. A short sidebar summarizes the results of a 2021 survey showing that the number of nonprofits reporting at least four to six months of reserves ticked up.