As the economy fluctuates, it challenges many schools and universities with how they are structured. With these changes, it can be difficult to find financial stability with rising challenges such as reduced funding, pandemic effects, rising costs, and more.
To continue providing people with education and opportunities, universities must be proactive in staying with the changing economy and ensure their financial stability is in a good position. Keep reading to explore areas that can help long term financial health in these institutions.
Continually Adapt Your Financial Plan
As an institution, you likely already have a financial plan in place that has been successful so far. However, you should always be looking for ways to improve the plan, especially in times of economic uncertainty. Some ways you can do this are:
- Review the budget monthly and adjust as needed
- Collaborate with financial professionals or accountants Rexburg to find areas to improve and gain expert insight
- Implement a forecasting model to help you prepare for upcoming needs and changes
Collaborate with Financial Advisors
Elaborating on this point from the last section, meeting with a financial advisor or someone who truly understands the industry and everything that goes into it can heavily improve the financial health of a university. Consider working with a Certified Public Accountant (CPA) that specializes in the educational industry and knows what works for an institution to thrive.
These accountants can help with managing cash flow, conducting audits, ensuring regulatory compliance, and tracking important KPIs. This will allow you to have a greater understanding and make smarter financial decisions in the future.
Optimize Operational Efficiency
It’s important to offer students and vendors with true value and opportunities, but there are areas where spending can be reduced. For example, if there are some programs or services that aren’t as popular or are underutilized, consider combining them with others to reduce spending in that area. Or consider implementing better technology or financial software to streamline processes. This will save time and cut unnecessary costs in the long run.
Diversify and Have Multiple Revenue Streams
Universities heavily rely on tuition and funding to generate revenue. If enrollment declines or the government needs to cut some of the budget, this can put them at a disadvantage. Putting eggs in different baskets allows the institution to have greater stability if one area falls through. This can include different fundraising events, real estate, partnerships, educational programs, and more.
Protect Endowment Funds
Endowment funds are long-term funds that donors invest to support an institution. To protect these funds, it’s important to conduct regular performance reviews and maintain transparency with donors to nurture those relationships. You can also improve donor programs so that they feel seen, heard, and that their investment is worth it.
Conclusion
Finding good financial stability and footing can be challenging for educational institutions in the middle of economic change. Putting these ideas into practice can help you stay adaptive and successful, even when unexpected circumstances arise.
