There are more than 1.5 million nonprofit organizations in the U.S. These organizations serve different aspects of society: health, wellness, unions, religion, community support, and business associations.
If you’re part of a nonprofit as a volunteer or staff member, you know how important nonprofit budgeting is. Your organization depends on meeting the budget in order to serve the greater good.
Read on to learn how to create a budget strategy for nonprofits so your organization.
1. Plan Ahead
You should start planning the budget well before the start of the fiscal year. It’s a good idea to have a budget committee made up of staff members and board members.
You should map out the steps to complete the budget and set a timeline to ensure it’s completed on time. This holds your team accountable.
2. Review Last Year’s Budget
You need to take a close look at last year’s budget and get feedback from people within the organization. Before you set the budget for certain programs, you should talk with volunteers to see if there are things that can be added to the budget.
You should also talk to your fundraising team to gauge how much you can raise in the next fiscal year.
3. Income and Expenditure Projections
You can’t predict the future. This makes projecting income and expenses incredibly difficult.
The best thing to do is to look at this year’s budget and the final budgets from the past three years. You’ll be able to develop a budget based on this information.
This is a tough job, and you may need to rely on a team with non profit finance management to help you manage the projections.
4. Align the Budget With the Vision
The staff, board members, and volunteers should take another pass at the budget. This time, you need to review the strategic plan of the organization before you do so.
You want to ensure that all of the expenditures are aligned with the goals and the vision of the organization. Any expenses that aren’t aligned should be removed or replaced.
5. Presenting the Budget
Now that you have the budget in place, you need to present it to all stakeholders in your organization. Your organization’s bylaws may state that you have to have a membership meeting for final approval.
At the very least, print out the budget and mail it to donors, so they can see the direct impact of their contributions.
The Top Nonprofit Budgeting Tips
You don’t want your nonprofit to run on a shoestring budget. You want the organization’s financial situation to thrive. That lets you serve more people in need.
These nonprofit budgeting tips walk you through the planning process to create a realistic budget for the organization. You should walk away with a budget that’s aligned with the strategic vision of the organization.
Now that you have the financials down, head over to the Marketing section of this site for tips to promote your organization.
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