Amid a changing economy, political upheaval, and uncertainties for federal nonprofit funding, it’s more important than ever to reevaluate your organization’s financial management strategies. Enter nonprofit asset management—strategies you use to proactively manage your cash, physical assets, and other holdings.

Understanding asset management basics is crucial to creating a safety net for your organization and moving toward financial sustainability. In this guide, we’ll cover the following to help you get started:

• What is Nonprofit Asset Management?
• What Are Your Nonprofit’s Assets?
• Why is Proactive Nonprofit Asset Management Important?
• How to Manage Your Nonprofit’s Assets
• Working with a Nonprofit Asset Manager

Don’t worry if this is unfamiliar territory for your nonprofit. Now is the perfect time to shore up your finances and intentionally steward funds. We’re here to help.

What is Nonprofit Asset Management?

Nonprofit asset management is the practice of acquiring, managing, and growing your organization’s financial assets. Managing your assets may include creating and monitoring reserves, investing funds, planning to acquire new assets, communicating with your board about finances, etc. Ultimately, asset management ensures you keep an eye on your organization’s holdings and steward them responsibly.
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How is Asset Management Different from Cash Management?

Asset management often overlaps with nonprofit cash management. However, asset management deals specifically with the assets your organization owns rather than the flow of cash in and out of your nonprofit. Asset management concerns both financial and physical assets (like buildings, real estate, and equipment), while cash management focuses only on finances.
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What Are Your Nonprofit’s Assets?

Your nonprofit likely has many tangible and intangible assets. This collection of assets may include:

• Cash
• Investments
• Endowments
• Property and real estate
• Fixed income and physical assets (buildings, vehicles, equipment)
• Grants

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This means that everything from the money in your reserve fund to the new community center you’re building is an asset that needs to be managed. To keep track of all the assets your organization owns and handle them responsibly, you need an asset management strategy.
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Why is Proactive Nonprofit Asset Management Important?

With a dedicated financial strategy, your nonprofit will be able to:

Mitigate Risk

Risk management is vital for keeping your hard-earned donations secure and ensuring you can use them to further your mission. Without responsible asset management policies, you may expose your organization to more risk than necessary, resulting in unwanted outcomes and a loss of donor trust.

However, you can mitigate risk with proper asset management strategies like storing your assets in FDIC-insured sweep accounts, monitoring investments regularly, and planning for long-term strategic financial growth.

Improve Transparency

When you have a thorough understanding of your nonprofit’s finances, you can be transparent with both internal and external stakeholders. Board members and staff should be on the same page about your organization’s financial standing and how to plan for the future. For supporters like donors and grantmakers, you can easily provide reliable information about how you use their funds. More transparency means more trust, leading to a rock-solid foundation for long-term support.

Increase Financial Sustainability

If you don’t actively manage your assets, or keep money in savings accounts, you may be missing out on potential interest gains or watch them lose value over time due to inflation. Additionally,  many nonprofits struggle with multiple disparate accounts to ensure coverage by the FDIC, leading to bookkeeping headaches and potential mistakes.

By strategically managing your assets and placing reserve funds in low-risk, highly liquid holdings, you can set your nonprofit up for long-term financial sustainability and growth. You’ll give your money the chance to increase in value while maintaining full, consolidated FDIC coverage, putting your funding to work for your nonprofit’s future.

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How to Manage Your Nonprofit’s Assets

If you’re ready to take control of your organization’s assets, start by taking stock of where your nonprofit currently stands. How much does your team know about asset management? What are your current assets, and how have you managed them so far?

Then, follow these steps to improve your strategy.

1. Partner with a Nonprofit Investment Advisor

While your organization can manage assets on its own (if you have enough bandwidth and expertise), we highly recommend working with a professional nonprofit investment advisor.

The right advisor will be instrumental in creating your asset management strategy. These financial experts can help you draft policies, manage investments, report on your assets, and even discuss asset management best practices with your board of directors.

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With a professional advisor, your organization can access the following impactful benefits:
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• Improved cash management
• Personalized financial asset management and support
• Professional Investment Policy Statement (IPS) creation
• Less risk for your board members
• Long-term help meeting your financial growth goals

Plus, if you don’t have a brokerage account for your organization yet, you can open one directly through nonprofit investment advisors like Infinite Giving.

These accounts are tailor-made to address nonprofits’ needs. We understand the importance of streamlined asset management and full FDIC coverage to protect your funds—that’s why our sweep program helps you access up to $5 million in FDIC coverage from one account.
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2. Create Asset Management Policies

Next, work with your investment advisor to create organizational policies that will guide your asset management strategies and protect your nonprofit’s leaders. Thorough, official policies are essential for managing your financial assets responsibly.

You might create one or both of the following:

• Asset management policy: This policy should cover both financial and physical assets, explaining how you’ll acquire, manage, maintain, and dispose of them.
• Investment policy statement (IPS): This document has a narrower focus and details the specifics of your organization’s investing strategies, such as where you’ll place reserve funds and how much risk you plan to take. It should outline the board’s and advisor’s roles, fiduciary responsibilities, and more.

Your advisor should create at least your IPS for you and work with your board to ensure it aligns with organizational priorities. You may adjust this policy over time, but it’s essential to have a detailed document ready before investing any of your assets.
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3. Diversify Your Assets

With your policies outlined, consider the distribution of your assets and how you might diversify them further. Asset diversification helps you avoid relying too heavily on any one source of funding, and it opens the door for more fundraising opportunities and larger donations.

One easy way to diversify your assets is to start accepting non-cash donations. For instance, Infinite Giving’s comprehensive giving tools help your nonprofit seamlessly accept gifts of:

• Cash
• Stocks
• Cryptocurrency
• Donor-advised fund (DAF) grants
• Endowments

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Many of these giving methods are in high demand with wealthy donors since they help them access additional tax benefits. By making it easy for donors to make these types of contributions, you’ll improve supporter relationships and maintain a diversified asset portfolio.

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4. Monitor Your Investments

Managing your financial assets typically involves investing them in low-risk, highly liquid holdings to give them the potential to grow and outperform inflation. It’s vital to monitor these investments and report on them to your organization’s leaders regularly.

At a minimum, you should analyze investment reports on a monthly and quarterly basis to ensure your strategies are working. However, our team of nonprofit investment advisors at Infinite Giving makes it even easier to check on assets at any time with our comprehensive dashboards.

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From your dashboard, you can see your organization’s earnings, deposits, total returns, and investing activity at any time. It’s easy to monitor your reserve funds and endowments and initiate fund transfers as needed. You can even access documents like quarterly reports from one convenient location.

5. Be Transparent with Donors

Finally, determine how you’ll discuss your nonprofit’s asset management strategies with donors and other external stakeholders. Remember, the more transparent you are, the greater trust you’ll inspire.

You might add a page to your website that explains your cash management approach and how you’re putting donors’ funds to work. Be clear about why you need a reserve fund, how proactive asset management drives financial sustainability, and how these strategies will ultimately help your nonprofit thrive for years to come.
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Working with a Nonprofit Asset Manager

As mentioned earlier, outsourcing your organization’s asset management can be a major help. When you partner with an outside expert, you’ll free up team time and receive on-demand, trusted financial expertise.

But not all asset managers are created equal. Every nonprofit has unique needs, and it’s important to consider what type of asset manager will benefit your organization most in the long run. Let’s discuss the two main options you can choose from:

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• Institutional asset management firms are large financial institutions that work with a wide variety of clients. They have little to no nonprofit expertise and may prioritize higher-risk investing strategies that don’t suit nonprofits’ needs. While individual firms differ, most offer less personalized services and fees designed for larger institutions.
• Nonprofit investment advisors are fiduciary investing advisors who exclusively serve nonprofits. They focus on low-risk, highly liquid strategies and provide specialized, hands-on advisory support. Their fees and account minimums also tend to be flexible, ensuring accessibility for nonprofits of all sizes.

Ultimately, when compared to institutional firms, nonprofit investment advisors have more specialized expertise and a better understanding of your organization’s asset management needs. They may also offer additional services and tools designed for nonprofits, such as non-cash giving platforms, endowment creation tools, and self-service dashboards.

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Infinite Giving’s nonprofit investment management services

At Infinite Giving, our mission is to leverage modern financial technology to help nonprofits grow, making asset management accessible and straightforward for all organizations. We offer professional investing advisory services, brokerage accounts, easy-to-use giving tools, and more.

When you work with us, you’ll benefit from:

• Deep nonprofit expertise and experience
• Fiduciary investment advising and management
• 24/7 access to an online dashboard for tracking asset growth
• Quarterly board reports, monthly statements, and end-of-year tax documents
• Intuitive non-cash giving tools to diversify revenue streams and secure large gifts online

We work with nonprofits of all sizes and cause areas, designing tailored asset management strategies to suit each organization’s unique needs and goals. Whether you’ve been investing for years or don’t even have an IPS yet, we can help.

Just take a look at our work with the Atlanta Land Trust, a nonprofit organization dedicated to connecting individuals with affordable housing in Atlanta, GA. Their leadership recognized the need for proactive cash management strategies and partnered with our advisors to create their first IPS, open an operating reserve fund, and start investing. Through our partnership, the Atlanta Land Trust grew its reserves to $1 million, setting them up for long-term financial sustainability.

Wrapping Up

Nonprofit asset management is a vital part of responsible financial stewardship, so it’s worth taking the time to understand and determine the best strategies. We know it can feel overwhelming for nonprofit leaders, especially those without investing experience. That’s why our team is always here to provide the tools, support, and insight you need to thrive.

Excited to learn more about improving your nonprofit’s financial sustainability? Check out the following resources from our team:

• Cash Management for Nonprofit Organizations: Basics + 8 Tips. How you manage your cash is an important part of your asset management strategy. Discover best practices for stewarding your funds responsibly.
• Working with Nonprofit Investment Advisors: FAQs and Tips. Still have questions about working with nonprofit asset managers? Explore our FAQ guide for more insight.
• Investment Consulting for Nonprofits | Infinite Giving. Learn more about our philosophy, how our fiduciary advisors work with nonprofits, and what we can do to improve your asset management strategy.

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