The budget is the heart and soul of a grant application. It outlines specifically what it’s going to take to achieve the goals you’ve set for your proposed program. Developing a budget can seem overwhelming but when you take it line by line, step by step it becomes a very straightforward process. To help you in the budget writing process, Resource Associates’ grant experts have provided explanations and suggestions for creating the various aspects of a budget.
What do you need?
Developing a budget starts with looking at your program design and deciding what activities, personnel, supplies, and other assets will be required to implement it. Once you have figured out what you want and need money for, divide the items into budget categories. The grant RFP will outline the specific categories they want but in general, federal budget categories are Personnel, Fringe Benefits, Travel, Supplies, Equipment, Contractual, Construction (very rarely used), Other, and indirect Costs. The best way to learn what can be included under each of these categories is to review the RFP for the rules for each category. It’s important that you put expenses into the correct categories or the funder may make you move it to the correct category or, worse case scenario, remove the expense from the budget entirely.
How do you break down budget costs?
For each line in your budget, you’ll need to present three things – the budget category, the specific line item, and a breakdown of how you got those costs along your justification for the item. For example:
Line item: $945 for national conference in San Diego, March 2016
Breakdown: ($500 Airfare) + (2 nights lodging x $125 per night) + ($65 per day x 3 days per diem) = $945
Justification: Networking and recruiting at the largest gathering of potential volunteers and contributors.
How do you calculate budget match?
Some grants require that you provide matching funds. Matches can be provided in-kind (good and services) or in cash. You will need to read the funders guidelines and be clear about how they calculate budget matches as they vary from application to application. Some matches are calculated on a maximum budget amount, others on an open-ended budget amount. Additionally, matches can be calculated as a percentage of the total request made to the funder or are based on the total project cost.
What are indirect costs?
Indirect costs compensate an applicant for the overhead of running a grant program. If you’re going to include indirect costs in your proposal, make sure that you have a federally negotiated indirect cost rate with the funder or another cognizant agency. Indirect costs are usually calculated based on allowable direct costs. For example, some agencies only allow you to apply the first $25,000 of the contracted funds to your indirect cost calculation.
How do you present it all?
The only option here is Excel! Your budget is full of details that need to be presented in a clear, concise way to reviewers. With Excel, it’s easy to outline the budget categories and make sure your calculations are all adding up correctly. Excel also allows space to put your budget justifications in line with the budget amount. Once you’ve created your budget, just save the Excel document as a PDF and the information will look exactly like you created it in Word.
The budget is an essential element of a grant application. Great care should be taken to ensure you’re including everything you’ll need money for and that it all adds up correctly. If you’d like someone to review your budget or have questions about writing one, get in touch with one of Resource Associates’ grant experts. They’re always happy to share what they know!