So far two regional banks have failed and others are struggling which is a very nasty way reminding us that importance of nonprofits having emergency cash on hand.
In these chaotic economic times, here are three things nonprofits should know about emergency reserve cash.
Have a Nonprofit Reserve? Use it!
With a recession looming, emergency funds is lifeline toward strength. Document and monitor reserve spending with your nonprofit board and make a plan to replenish emergency reserves when funds are flush again.
If You Can, Earn Income On That Cash
With interest rates increasing, there are better places to invest reserves than a checking account. Money Market Funds, one of the safer places for cash, are yielding from 2% to over 4% right now. Ask your bank or advisor about current yields.
Scrutinize Nonprofit Budgets Regularly
High prices and potentially slower economic growth requires financial care. A likely recession with high prices is a dangerous combination, so ensure your nonprofit financial plan projects income and expenses on at least a quarterly basis, if not more frequently.
Talk to the financial experts at Fairlight Advisors to learn more about managing your nonprofit’s investments. Schedule a free consultation today!
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