About two years ago, my husband and I realized that our spending had gotten completely out of control. We didn’t have a handle on our finances, and it was very stressful. At one point, we had close to $300 in insufficient funds fees all from not keeping an eye on our account. Today we have a budget, a very detailed one that we review every week.

The budget is a crucial component for all businesses. This is the one area where you really should sit down and take your time developing. You even need to me clear about whether or not you want to operate a cash based business, meaning only get what you can absolutely pay for without getting loans.

As for starting a nonprofit, budget creation is essential. (Revisit an old post.) You’ll want to be careful not to exaggerate the budget, but to stick to actual figures. The reason for this, nonprofit funders are looking carefully at your budget. For the most part, they want to know what will become of their investment. Also, you have to be ready to share itemized expense reports with your funders. Funders/contributors are very skeptical, as they should be, about
where their funding dollars are going. So, be clear, and detailed about your financial needs.

It is a great idea to revisit your overall budget quarterly, and a monthly check up to ensure that you are keeping an eye of your bottom line is essential for a healthy business.

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