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Creating a budget and sticking to it!

When you think budget don’t automatically think financial handcuffs. Knowing how to budget is a valuable tool that can help you to stay in control of your money, rather than allowing your money to control you.

Submitted 6/13/2006 By joanne Views 13385 Comments 0 Updated 10/29/2008



Event budgets


Keeping a budget is particularly important when organising an event. An event budget determines an events ultimate size, shape and form, and is therefore something that must be considered right from the word go. When organising a fundraising event sticking to a budget is a must, because in order to make your fundraising efforts worthwhile—you need to make sure that your event brings in a profit.

When creating a budget you need to consider two things:
  1. revenues—this is the amount of money that will be flowing into your event
  2. expenses—this is the amount of money that will be spent on the organisation and running of your event.

Creating an effective budget will guarantee that your fundraising event generates enough revenue to pay off all your expenses and raises the additional funds that you need to donate to your cause.

Step 1: gathering information—create an event budget checklist

The first step involves writing two budget checklists. Before you do this you must be clear on what you want to achieve, how much you want to raise and the type of event you want to organise.

  1. The first list should be of all your projected revenue. This must include all the sources from which you will receive money.
  2. The second list should be of all your projected expenses. This must include all the sources on which your money will be spent.

When you are writing these lists you need to think carefully about EVERYTHING that your event may involve—both expected the unexpected. It is important that you are realistic— and at times pessimistic—about the costs and incomes. To be on the safe side follow the golden rule to always budget expenses liberally and to budget income conservatively because things often cost more than you anticipate.

Think about your likely sources of income

  • Sponsorship
  • Ticket sales
  • Alternative forms of revenue at the event— such as raffle/auction/bar/food
  • Monetary donations
  • Donations in-kind

Think about your likely expenses

  • Permits
  • Equipment hire
  • Food & drink
  • Staff
  • Advertising/invitations
  • Speakers
  • Administrative costs such as phone, mailings, faxes, petrol

Be sure to go through your likely expenses very carefully— you’ll be surprised at the number of ‘hidden expenses’ at need to be taken into account if your budget to be successful.

Step 2: the formula

Once your budget checklists are finalised, these can be used to assess whether the event you have planned is feasible. You can do this by subtracting the sum of your projected expenses from the sum of your projected income. This will leave you with one of three possible outcomes:
  1. A negative amount—this means that you need to stop planning and to start assessing how and where you can cut costs and increase your income. You may also need to assess whether your plan is feasible— think about whether there is a more effective way of raising funds?
  2. Breaking even—although not as bad as a loss, breaking even is not the result you’re after. It is essential that you make a profit in order for your fundraising efforts to be worthwhile.
  3. A positive amount—this is great! It means that your event will bring in profits. Always compare this amount to your fundraising goal to see if they match up. If your projected profits are lower than your fundraising goal, readjust your events plan in ways that will decrease costs and increase your takings. Remember, you are budgeting for an expected fundraising total and not just running an event.

Step 3: tips on how to keep your costs down

Shop wisely

  • Buy your supply products wholesale and stick to the cheaper brands

Simplify

  • Are those expensive decorations or state of the art sound/lighting systems are necessary?
  • Could your invitations be printed on cheaper paper?

Make full use of donations in kind

Use your connections to get as much as you can for free.
  • People’s time—recruit volunteers rather than paying your staff
  • Publicity: printing and photocopying invitations; graphic design for posters and fliers; local radio airtime or newspaper space
  • venue
  • equipment

Step 4: sticking to your budget

Setting up a budget is a fairly straight forward process, the real challenge is sticking to it. In order to successfully stick to your budget you need to keep close track of all expenses and revenues. An easy way of doing this is by holding onto all your dockets, receipts and invoices. This will help you to know exactly where you stand financially at all stages of the process and to ensure that you don’t spend more money than you’ve actually got. To avoid mistakes and confusion, it’s a good idea to delegate this role to one person.

How do I know this?

Bravo, _ Event guide_, http://www.bravoevent.com/helpfulhints/budget.html

Money Manager, Budgeting guide, http://moneymanager.smh.com.au/planning/guides/bud...

Weisman, C (ed.) 2000, _Secrets of successful fundraising: the best from the non-profit pros, F. E. Robbins & Sons

Youthcentral, Budgeting, http://www.youthcentral.vic.gov.au/ViewPage.action...