Plansmith Blog

Fresh Tips for Successful Budgeting

Posted by Megan Plis on 2/2/21 12:09 PM
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Plansmith is a planning company, as our name implies. For 50 years, budgeting has been what we’re known for. We get a lot of questions about our top budgeting advice, and as we kick off a new year, it’s the perfect time to offer some fresh tips for successful budgeting.

Though we certainly suggest using a robust budgeting solution like our Compass software, this advice applies to any process. We understand many organizations still use spreadsheets or outdated software, and that may work for them because they’re used to it. However, quality planning software makes budgeting much easier, more accurate, and more approachable for all parties involved – including the board during presentations.

So, what are some realistic tips for effective budgeting?

  1. Start the Process Early

A good budget isn’t prepared in a day, a week, or even a month. In fact, it’s hard to simply associate a timeframe with a quality budget. A budget should be planned for, discussed by those who are responsible for it, adjusted, reviewed, and adjusted again until all parties are in agreement. This not only takes time, it takes effort and planning. That’s why we call the creation of a budget a budgeting process, as it should truly be a systematic event. Putting the budgeting process off too long can prove detrimental to the utility of the final product.

  1. Reforecast Often

Reforecasting is a process by which organizations make regular adjustments to their budget based on current realities. Put more simply, reforecasting keeps the document relevant. The better you can keep a pulse on evolving business conditions and how they affect your budget, the more effective the document itself will be. Furthermore, the more effort you put into reforecasting, the less work you’ll have to do for next year’s budget as the existing pieces should be mostly accurate and up to date.

  1. Create a Budget Playbook

A budget is great, but it’s only one piece of the puzzle to ensure the goals of the document are met. A budget playbook creates accountability by assigning ownership and tasks that will lead to the execution of the organization’s goals – including those financial goals established by the budget. Instead of simply hoping and crossing fingers that things get done, use the budget playbook technique and plan ahead for success. If you’re unsure of what a budget playbook consists of, click here to watch a short video.

Curious how to put these tips into practice with your current budgeting process? Click here to schedule a discovery call to learn how Plansmith can help.

Topics: community bank budget, budgeting, playbook, credit union budgeting

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