The first quarter of 2026 looks to be yet another turbulent period for nonprofits. To start, government funding is down and, as Aaron Seybert of The Kresge Foundation reported, “These spending reductions will place significant strain on nonprofits’ revenue streams, operational stability, and ultimately the impact they are able to make.” In addition, the ongoing economic uncertainty we’re experiencing is driving some foundations and independent donors to pull back as well. Meantime, while the need for many services is on the rise, putting even more strain on nonprofits to not only maintain their current programs, but to increase them.

The result: CEOs are finding themselves in a bind. Now, more than ever, they need to ensure the stability of the nonprofit organization while meeting the needs of the constituents they serve.

What’s more, delayed payments, which are happening more often in this economy, are creating short-term cash flow crunches, while rising costs due to our elevated inflation rate are putting strains on the budget even when the promised funds arrive on time. 

But there is a way out, and it starts with a tighter partnership with their CFOs. By working closely together, the CEO and CFO can find ways to strategically ensure the stability of their organization and meet any growing demand for their services.

The first step toward a nonprofit’s greater financial resilience is to fully understand the exact operating costs of each program it runs, including the administrative costs, as well as the income stream from the various funding sources. That way, as I wrote in a recent post, the organization can ensure the income is covering expenses and not being subsidized by another program’s income stream and be able to fundraise off any specific replacement needs (or know how much they need to cut within a program) should a current funding source go away.

One more thing: When undertaking scenario planning, be sure to determine if you have too much revenue concentrated with one or a small number of funders and any associated risks.

There’s a simple process for conducting this scenario planning: 1) confirm the goals of the plan and collect the data; 2) build your plan templates; 3) create the models for the various scenarios from best possible outcome to the worst possible; 4) deploy the plan and monitor the progress, continually adjusting the plan as needed.

We at JMT Consulting know this process works because my team and I have guided countless clients through it. And based on watching the results, we know that scenario planning is the most important thing one can do as a first step, because it empowers informed decision-making, shows potential donors that the organization is prepared for any situation, and gives you targets and talking points for fundraising.

The second step is to strengthen relationships with existing donors and reassess grant pipelines for reliability. Once you understand the true state of your relationships and grant pipeline, a roadmap for strengthening your ties with the donor should become clearer, and the information can help you develop back-up plans should a donor withdraw their support. The CFO can help with this step by analyzing trends in donor and grant activity and helping leadership understand where potential risks or gaps may emerge. JMT Consulting can also support this process through financial reporting optimization and advisory services that align financial data with fundraising strategy.

You should also focus on diversifying your revenue streams. You might be able to go beyond traditional grant requests to having fees for providing an educational service, memberships for other services, selling branded products, and partnering with local corporations to receive in-kind donations from them and gain volunteers. If you find the right partner, you can even run a cause marketing campaign that benefits your nonprofit. Just get creative to explore your options and then have the CFO identify potential expenditures in time and money to ensure that the income outweighs the costs. The one caveat: You need to make sure your accounting system is flexible enough to track the expanded range of income sources. That’s where a platform like Sage Intacct can help. One reason we often recommend it to our clients is its tracking flexibility.

Then, to ensure you are fully up to date on the financial health of your organization, you should have your CFO continuously monitor any burn rates of your funds to understand your runway. Be sure to include any increases in any costs, which can shorten your runway. Features in Sage Intacct that can help include real-time dashboards, dimensional reporting, and automated visibility into program, grant, and fund performance. These features allow finance teams to monitor burn rates and cash flow without relying on manual reporting.

Also, have your CFOs build flexible budgets that can scale as the need for your services grows, and look at any technology investment needs, staff training, office costs, and other resources you might need should you launch new programming. And once you have this vital data and the resulting insights, you can easily convey it to the board and funders, eliminating any potential surprises with them, all while demonstrating strong financial stewardship, which builds trust. JMT supports this through board-ready reporting, financial planning and analysis (FP&A), and Client Accounting & Advisory Services (CAAS) that help translate complex financial data into clear, decision-ready insights for leadership and stakeholders.

Finally, partnering with your CFO can help make you a better strategist when searching for ways to grow your nonprofit. A strong working relationship between the two of you means you’ll have the data to better align the priorities of your mission with your financial realities.

Once you build a strong foundation of open communication, you can engage in the back-and-forth conversations that will enable you to turn your complex financial information into actionable insights. Best yet, with the joint decision-making that naturally comes out of a partnership, less of a burden will be on you. As a result, it will help lower your cognitive load, making your job more enjoyable, which should be enough of a reason to take these steps. Plus, your CFO will enjoy their work more and feel more rewarded too, enhancing retention.

Let us discuss how we can help make this partnership happen. JMT’s advisors can guide you through these steps. After all, JMT was founded in 1991 to help nonprofits achieve their mission of helping others. And we’ve been doing that ever since. Simply contact a client account manager today to get started.