Your budget will be unique to your organization, but we’ll give you a broad idea of what to include under each section. Lastly, it’s rare that nonprofits have unlimited funds, so they need to be realistic and thoughtful about setting restrictions on what they can spend money on. It’s important to be realistic in reviewing income sources and expenses. Board directors should be careful to consider the state of the economy and any unusual or unforeseen financial situations of their contributors. At least once a quarter (but ideally bi-monthly or monthly), compare actual expenditures against the projected budget to make sure your nonprofit is on track.

• If you’re ready to work with us for your nonprofit budgeting and other financial management needs, don’t hesitate to contact us so we can get started.
• Your exact ratios should align with your organization’s size, mission, and growth stage.
• Technology is an important tool for responsible budgeting for nonprofits.
• This good financial management falls under the duty of care, another aspect of fiduciary responsibility.
• For instance, the costs of program materials and necessary transportation will likely shift over time.
• Seeing these things side by side gives you the tools to decide how you can best use your resources.

Types of Budgets for Nonprofits: Which Is Best for Your Organization?

For organizations in the nonprofit sector, try to allocate between 5-15% of your budget to marketing. From daily operational costs to monthly donations, there https://nerdbot.com/2025/06/10/the-key-benefits-of-accounting-services-for-nonprofit-organizations/ is a wide range of elements that should be included in your nonprofit’s budget. After you calculate your financial statements, pull insights and share them with your staff, volunteers, and board.

• While there will inevitably be some assumptions in your budget, try to work with real numbers as much as possible.
• Since different funding sources often come with specific restrictions, your budget should carefully allocate resources to cover each need effectively.
• If your nonprofit relies heavily on grant funding, this budget outlines program costs to meet grantor specifications, including fund-matching requirements.
• We work exclusively with nonprofits, so we understand the unique complexities of your organization’s financial situation and can use our experience to develop tailored solutions for your needs.
• Therefore, it’s most effective to categorize the revenue side by source.
• To help you get started, we’ve created a basic nonprofit budget template to track your revenue and expenses.

Reduce your expenses with Givebutter

In this role, she leads efforts to share accounting services for nonprofit organizations the impact of the Cradle to Career Network, build awareness and move supporters to action. Use known values to budget for other related estimates, such as personnel costs. Create a detailed personnel tab by listing each employee’s base salary for the year and calculating bonuses, benefits and taxes as a percentage of the known salary.

Capital Budget for a School Renovation Project

Create guidelines for when to adjust projections, shift resources between programs, or implement contingency plans. Even organizations working with a shoestring budget must think carefully about costs. Some of your organization’s expenses remain steady month after month, while others change based on your activities. You can simplify the process—incorporating best practices, adapting to your organization’s needs, and making budgeting easier to manage—with Sage cloud-based financial planning and budgeting software.

Budgeting for nonprofit organizations: The board’s guide

This nonprofit startup operating budget template features sections for total one-time startup expenses, monthly expenses, and total funds required to operate. Use this operating budget template to ensure that your nonprofit has accounted for every single cost and expense. By doing so, you can keep an eye on your big-picture forecast with the assurance that every detail of your accounting is in order. Nonprofits can keep tabs on their annual program revenue vs. expenses with this easy-to-use nonprofit program-based budget template.

Identify Key Stakeholders

If you want to move into a new office space this year, you can estimate the rent. If you want to hire a new marketing director, you can look up salary trends to discover how much you need to pay them. Good communication between the program, finance, and development departments and the board is key to monitoring the budget during the year. These projects probably won’t be delivered every year, so separating your operational budget from your capital budget is the best way to go forward. Keep in mind the difference between fixed and variable costs when you are tracking expenses. Variable costs are directly tied to events, increasing or decreasing and changing with each situation.