by Jac La Tour
I’ve written recently about operational cash reserves and why they’re so important for your ministry. To calculate the right amount of operational reserves you need to identify three things:
- Your ministry’s cash flow fluctuation
- Potential unplanned events that could tap ministry reserves
- Potential strategic opportunities that aren’t included in your annual budget
You can find out how to calculate these things and come up with a cash reserves target balance by reading the ECCU white paper Cash Reserves: How Much Is Enough?
You also need to set aside cash reserves for facility maintenance and improvements. This includes things like resurfacing parking lots and replacing air conditioning systems. We developed a Replacement Reserves Calculator to help you calculate the amount of reserves your ministry will need to cover these types of expenses.
One good way to start saving is with ECCU’s Intro Plus Money Market account. You can learn about it and link to the cash reserves white paper and Replacement Reserves Calculator at www.eccu.org/intro-plus.