With these features in mind, let’s dive deeper into the two sides of your nonprofit’s operating budget. There are two primary ways that a nonprofit organization can choose to budget its finances – historical budgeting and zero-based budgeting. A cash flow budget is focused on covering big expenses like capital projects or payroll work.

Resources

By linking financial decisions to your mission and goals, you’ll make smarter choices about where to allocate resources. But budgeting isn’t just a box to check after plugging numbers into a spreadsheet. Creating a nonprofit budget that will set your organization up for success requires a thoughtful process that considers multiple factors that are specific to your organization. Learn the essentials of developing a nonprofit budget—tips, best practices, and free resources to help you build a strong, credible budget or refine your current one. This overview and guide to using the Program Budget and Allocation Template is not intended to be a definitive or comprehensive document for such a complex financial management practice.

Calculate your nonprofit’s expenses 📊

• Several key features distinguish effective nonprofit budgets from basic financial plans.
• Besides the different types of budgets, there are also fundamental approaches to strategic budgeting.
• Once the budget is in place, it is essential to monitor it regularly and make necessary adjustments (amendments) based on the actual performance and changing circumstances.
• As we look towards 2025, nonprofits face a unique set of challenges and opportunities.
• The software also provides valuable real-time reporting, allowing for mid-year budget to actuals comparison reports.
• Like any small business, your nonprofit needs enough cash flow to cover all its operating expenses—paying staff salaries, keeping the lights on, and covering upfront costs for fundraising events.

Examples might include materials purchased specifically for a tutoring program or the accounting services for nonprofit organizations cost of an evaluation consultant to document the results of a preschool program. Administration and fundraising may have direct expenses assigned to them as well. The cost of return envelopes to be included in a fundraising mailing would be assigned directly to fundraising. Timing could be affected by events, annual appeal revenue drives or large gifts. Note months that may have more revenue coming in or more expenses going out.

• This guide is designed to help nonprofits of all sizes master the art of budgeting.
• However, you can adapt some of our tips to create other types of budgets.
• Whether you’re new to budgeting or looking to refine your process, this template offers a solid foundation to build upon.
• You can also use industry benchmarks and specific examples to demonstrate responsible resource management.
• A nonprofit’s budget is more than just a set of numbers; it’s a statement of the organization’s mission and goals.
• Thankview’s Nonprofit Budget Template is specifically designed to help nonprofit organizations manage their finances effectively.

Nonprofit Budget Templates: 3 to use NOW in Google Sheets or Excel

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. Your annual nonprofit budget is a straightforward document with all of your projected expenses and revenue for the year. These numbers help guide your business choices—a sample nonprofit budget will show you what to include. This is also sometimes called a “broad scope budget” or an “annual budget” because it gives you a full picture of what the coming year should look like. A nonprofit operating budget template can help you make sure you’ve hit all the bases.

• Ed is a seasoned professional with over 12 years of experience in the Governance space, where he has collaborated with a diverse range of organizations.
• It also breaks down the nonprofit’s operating expenses and overall costs.
• Regardless of whether a funder will pay for fundraising expense, it remains part of the total cost of running each program and we need this information to be truly informed.
• “Our nonprofit will increase overall contributions by 20% by the end of 2024 through partnerships with local businesses and corporate sponsors.”
• When estimating fundraising income, don’t forget to look at multi-year trends in your organization’s fundraising.
• While you can (and should) use the previous year’s numbers to estimate upcoming expenses and income, you should carefully evaluate each one.
• Deciding whether and how to support these services is a central strategic decision for nonprofits.

Where Money Meets Mission®

Well-designed budget templates streamline financial management while ensuring you capture all essential information for decision-making and reporting. Even profitable programs can face challenges when expected revenue arrives months after expenses occur or when donation patterns don’t align with regular operational costs. Mastering cash flow management helps prevent these timing mismatches from disrupting your mission-critical work. A budget for non-profit organizations must balance multiple priorities while maintaining clarity and usability.

Consider income inconsistencies

Expenditures may include events, meetings, publications and other programs largely used to benefit members. Let’s identify your starting point for creating a budget and a few tips and tricks along the way. Similarly, the cost of fundraising is valuable to programs and the final step is to allocate fundraising expenses to each. The most common basis for allocating fundraising costs is based on percentage of total support received by each program.

• Grantmakers want to see the estimated total revenue for your nonprofit because they need to see how much their grant will matter to your organization.
• Analyze your previous balance sheets, income statements, and cash flow reports to understand your organization’s financial health.
• This will help you set realistic expectations and make informed decisions when creating your budget.
• Effective financial management is the backbone of a thriving nonprofit, ensuring stability, transparency, and informed decision-making.

Create templates to develop estimates for areas where revenue or expenses are consistent and repetitive, such as travel or revenue proposals. Assign an average value for flights ($600), hotel stays per night ($250), per diem rates for food ($50), transportation ($50) and more to make it easier to calculate trip costs. Typically, nonprofits have multiple areas where expenses occur—programs, administration, and fundraising. Establish clear categories to ensure you have oversight of every financial activity. Look for potential savings through strategic cuts of unnecessary expenses.