It is common for associations to be a couple decades old and to never have had a reserve study performed. In fact, we hear that quite a bit. It is likely that if your association has never had a reserve study that they are not funding enough in reserves or are issuing special assessments to […]
Underfunded reserves
Understanding Percent Funded of Reserves
One key feature that a reserve study should indicate is how well funded an association is. The way that is measured is by a term called percent funded. In Layman’s terms, percent funded means how much money you have in reserves versus how much money you should have in reserves. The Community Associations Institute defines […]
What to Do When Your Reserves Are Underfunded
Living in an association requires diligent financial management. The financial management has two distinct parts: the short term and the long term. Every year associations have to prepare a budget. Most of the line items in the budget are for ongoing operations and maintenance. Examples of these are tree-trimming, grass cutting, professional fees, insurance, etc. […]