August 29, 2014 2:53 am Published by

Budgeting is a funny word. For some it conjures feelings of security, safety and peace of mind. For others, it is merely a restriction, boring and too detailed. The thing is, budgeting should land you somewhere in the middle: with the best of both worlds.

Budgeting is designed to restrict and meant to be detailed! It is supposed to stop you from spending money that you don’t have. The more detail you go into, the more secure your business will become and the more relaxed you’ll be. All of which makes for a happier existence for you and a healthier business.

When it comes to actually making a budget, it’s easier said than done. So we thought we’d drill down into a few questions around budget setting to help you and your business.

Why should I budget at all?

Good question. Why should you bother?

Well, for a whole number of reasons, some of which we’ve already mentioned: security and safety is a big one, but also it allows you plan for the future. You’d never be able to progress as a business without planning, and you can’t accurately plan without a budget.

Budgeting will also allow you to spend money on the things that matter! You can look at what you’ve spent and know what you’re going to have to spend later on allowing you to make better-informed decisions right now.

What are the challenges of setting a budget?

Setting and keeping to a budget is not straight forward. But if you know what the challenges are you can prepare for them.

Things are continually changing. So budgeting for anything seems like an impossible task. But it’s actually okay to tweak and change your budget for unexpected costs. It’s not set in stone!

They’re hard to follow, we know that. So, get some accountability in place! Someone who will discuss how you’re performing in relation to the budget you set.

The early stages of operating on a budget can require you to be frugal. It can feel like an overhaul of how you’ve operated in the past.  Every purchase will require thought and careful consideration, where in the past you may have spent freely.  But the short term struggle will only make the long term benefits that much better.

What should you budget for?

To be honest, you should budget for everything! That’s the best thing to do. But if that all seems a bit daunting right now here’s a list of things you should think about when putting a budget together:

  • Daily running expenses
  • Expected marketing costs
  • Moving premises
  • Equipment purchases
  • Succession planning

There’s just a few short tips to help you in the budgeting process. It can seem like a lot of work, but once you’ve done it you’ll never look back!

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This post was written by M3evolve