Tag Archives: inflation

Consideration of Interest and Inflation in the Reserve Study

Both interest and inflation considerations are important to the calculation of your future reserve requirements.  Unless the association has made a conscious decision to transfer all interest earnings to the operating fund (which is the subject of an entirely different article), it is generally assumed that interest earnings will be retained in the reserve fund.  Likewise, inflation is a factor that will cause the prices you pay for future repairs to be higher than the cost you’re paying presently for those same repairs and replacements.

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