Every business faces challenges. From sudden drops in sales to rising costs or unexpected supply chain issues. You can’t predict every setback, but you can prepare for them. One principle that has helped countless small businesses survive during tough times is the 90-day rule.
The idea is simple: your business should always be able to survive for 90 days, even if no new income comes in. That three-month window gives you space to react, make changes and protect your business without resorting to panic decisions.
What is the 90-day rule?
The 90-day rule is a financial safety net, a way of ensuring your business can stay standing through short-term disruption. It means having enough money in reserve to cover your essential costs for at least three months. That includes payroll, rent, insurance, utilities and critical supplier payments.
This isn’t about hoarding cash or being overly cautious. It’s about building financial resilience. When unexpected events happen. Whether that’s a slow quarter, a client pulling out or an economic downturn. The 90-day rule keeps your business calm and in control. Instead of scrambling for emergency funds, you already have a cushion that gives you time to act strategically.
Why 90 days matters
Three months is long enough to make meaningful adjustments when things go wrong. It gives you time to find new clients, renegotiate contracts or cut unnecessary expenses. Most businesses don’t fail because they stop making profit, they fail because they run out of cash before they can recover.
The 90-day mindset encourages proactive planning rather than reactive problem-solving. By maintaining a buffer, you buy yourself time to think clearly, explore options and keep your staff paid. For small businesses, that breathing space can make the difference between bouncing back and shutting down.
It’s also a useful framework for mental clarity. Knowing you have enough to cover 90 days of operations reduces stress and helps you make better financial decisions. You can focus on fixing the issue rather than panicking about immediate bills.
How to build your 90-day safety net
Start by calculating your essential monthly expenses, the absolute minimum needed to keep your business running. Multiply that figure by three to find your target reserve.
You don’t have to hit that number overnight. Commit to setting aside a portion of your revenue each month until you reach your goal. Automating transfers into a separate business savings account can make the process easier and more consistent. It’s also worth reviewing your expenses regularly. Many businesses are surprised by how much can be trimmed without affecting performance.
Once you have a clearer picture of your finances, you can make smarter, more strategic decisions about what to save and where to invest. If you find this side of business challenging, seek advice from a qualified accountant or financial advisor. With the right support, you can turn good financial habits into sustainable systems that keep your business strong and ready for whatever comes next.
Managing cash flow during a crisis
When a crisis hits, your first priority should be to preserve cash. Even with a 90-day buffer, it’s vital to slow down spending and control outgoings. Delay or renegotiate non-essential costs where possible and communicate early with suppliers if payments might be affected. Most will appreciate honesty and work with you to find a solution.
Keep a close eye on cash flow. Instead of reviewing finances monthly, switch to weekly check-ins so you can spot potential problems faster. If customers owe you money, follow up promptly. A polite reminder can often speed up payments. You can also explore shorter payment terms for future invoices to improve cash flow stability.
During uncertain periods, it helps to have local support. Whether you work with an accountant in Romford, Redruth, Rugby, a local expert can provide hands-on advice to help you navigate financial challenges, manage cash efficiently and make smart, measured decisions. Sometimes an outside perspective is exactly what’s needed to bring clarity during chaotic moments.
Building long-term financial resilience
The 90-day rule isn’t just for surviving hard times. It’s the foundation for long-term resilience. Once you’ve built your safety net, you can use it as a springboard for better planning.
Set reminders to review your financial position every few months. Look for patterns in revenue, recurring costs and upcoming obligations. Adjust your savings goals as your business grows and expenses change. When you always know where you stand financially, you’re better equipped to make confident choices about hiring, expansion or investment.
Forecasting is another powerful tool for resilience. Predicting how your cash flow might shift over the next quarter helps you stay one step ahead, turning potential crises into manageable challenges.
Turning preparation into peace of mind
Every business faces setbacks. What separates those that survive from those that fail is preparation. The 90-day rule gives you breathing space to think clearly, adapt and make smart decisions when pressure hits.
By maintaining a three-month buffer, tracking cash flow closely and seeking professional advice when needed, you give your business the best chance to endure uncertainty and come out stronger on the other side.
Crisis-proofing your business doesn’t happen by chance. It happens through planning, discipline and expert guidance. And when you combine strong financial habits with the right support, you’re not just surviving tough times, you’re setting the stage to thrive in the future.