Contingency reserves require a construction company to hold back some funds in an account just in case something happens that increases the overall project cost.

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Contingency reserves are funds that are set aside to cover unexpected costs that may arise during a construction project. Holding back a portion of the project budget can help ensure that there are sufficient funds available to address unforeseen circumstances, such as delays or design changes. This practice is common in many construction projects and helps to mitigate risk and ensure that the project is completed on time and within budget.

Contingency Reserves Require a Construction Company to Hold Back Some