Insights: A Financial Wellness Checkup for Your Nonprofit

What does financial wellness look like for a nonprofit? In Nonprofit Net of Greater Boston’s webinar, A Wellness Checkup for Your Nonprofit, David Orlinoff offered practical ways to approach nonprofit financial health. Drawing on more than four decades of nonprofit financial experience, Orlinoff organized his advice around three areas: recognizing symptoms, applying short-term treatments, and making longer-term “lifestyle changes.”

Recognize the Symptoms

One sign of financial stress can be chronic cash shortages. This problem can result from various underlying causes, such as paying bills too quickly, collecting receivables too slowly, or—more fundamentally—the organization's business model and the timing or predictability of funding.

Another symptom may be confusing or late financial statements. The organization's increasing size or complexity may have outgrown its financial capacity. Multiple funding streams and restricted grants can add significant reporting and accountability requirements.

Related Resources

A Financial Wellness Checkup for Your Nonprofit: Healthy Finances, Thriving Mission Nonprofit Net of Greater Boston, Dec. 9, 2025. (Video - 55 minutes)

Should You Balance You Budget? No! by Kate Barr, published, Nonprofit Quarterly, January 15, 2020.

Some of the other warning signs related to financial health may include budgets that aren't useful for decision-making, problems with grant and contract compliance, information hoarding, or a board that is reluctant to give, get, or lead.

Apply Practical Treatments

Orlinoff recommends several key short-term treatments to address some of the common financial management issues that nonprofits face.

• Regularly monitor cash, accounts and pledges receivable, and accounts payable. Keep your organization's finger on the pulse of key indicators of its financial health.

  
  

• Focus budgeting and reporting on what matters most. Consider the budget a reflection of your organization's values and priorities, including decisions about compensation, funding sources, and spending now versus investing for the future. Budget-to-actual reports raise questions that management needs to investigate.

• Treat grant and contract compliance as an organizational process. Establish a finance checkpoint for grant budgets before they leave the organization. Understand reporting deadlines, budget requirements, and other terms and conditions before the money is accepted. Create a grant compliance checklist identifying what needs to be done by whom.

  
  

• Share information—and don't let knowledge become a source of power. Consider information sharing an essential practice. When information is hoarded, it can contribute to financial problems and weaken organizational accountability. Build a culture of openness, starting with leadership.

  
  

• Engage the board. Board members should not only receive financial information, but understand it, ask appropriate questions, and use it to actively contribute to the organization's success. The board should also have clear expectations around giving and fundraising. A development committee, like a finance committee, can help establish accountability for board members' fundraising responsibilities.

Make Nonprofit Financial Wellness a Long-Term Practice

Longer-term “lifestyle changes” will help your nonprofit to continue to improve and sustain its financial wellness.

• Establish firm financial controls. Make sure there are clear procedures governing check signing, disbursements, authorizations, and access to financial accounts. Someone should also be responsible for monitoring bank balances regularly.

  
  

• Align staff and board around shared values and mission effectiveness. Disagreements are inevitable, but an organization needs enough shared vision to make sound decisions about its priorities and future.

  
  

• Avoid mission creep. Organizations need a shared understanding of how they will determine whether they are accomplishing their mission—not simply how much activity they are generating. Applying for grants for work beyond the organization's mission or capacity, for example, will create ongoing obligations and costs.

  
  

• Foster openness and collaboration. Many stakeholders in your organization have a role to play in financial management. Establish regular check-ins and information sharing practices to promote accountability and ensure everyone can contribute effectively.

  
  

• Prepare for disruptions. Contingency planning should address more than physical disasters. What happens if a key employee is suddenly unavailable? If organizational systems are compromised? If critical technology is unavailable? Even if a formal plan does not yet exist, beginning the conversation can help a nonprofit identify vulnerabilities and prepare responses.

Financial wellness ultimately depends on organizational culture as much as financial procedures. Clear responsibilities, regular communication, appropriate controls, thoughtful budgeting, and active board engagement can help nonprofits remain financially healthy while keeping their focus on mission.