What are nonprofit operating reserves?

In the nonprofit world, working capital is commonly referred to as an "operating reserve" or just reserve.

How much should a nonprofit have in reserves?
It's suggested that the minimum operating reserve ratio at the lowest point of during the year should be either 25% or three months of the annual operating expense budget.
What could nonprofit's reserve funds be used for?
Reserve funds help stabilize the organization, especially in times when funds are running short, and ensure that payroll is covered.
Is it hard to get approved for a nonprofit business loan?
Finding nonprofit business loans is a challenging process. Make sure to look at various options and find the one that fits your organization's needs best.

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Amalia Santa Maria

Amalia Santa Maria

Personal Finance Content Writer and Editor

Copywriter and content creator writing technical articles on finance that allow an average person to easily understand and connect with financial concepts.

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