Do you know how to develop a strategic budget for your grants?

Money is often a fun thing to talk about, yet so many people cringe when they think of the budget section of the grant. For me, I used to cringe, but now, I find it’s like a puzzle piece that needs to be sorted well – and early – so that the entire grant makes sense.

Today, I am going to show you how to create a strategic budget that you can use for every single grant that you write. By the end of the episode, you will have the tools to create an amazing budget. Having a simple and unified budget format could save you hundreds of hours of frustration.

If you want a free downloadable template, jump over to www.grantwritingandfunding.com/88 for the downloadable that follows all the podcast episodes on the G.R.A.N.T.S. Formula. 

Here’s a quick review of the previous pieces of the G.R.A.N.T.S. Formula:

GGet the FOA or RFP and use it as a template
R – Research needs
A – Articulate goals
N – Narrow your objectives
T – Timetable your activities

Let’s get started with the final letter of the formula today, “S” is for:

Strategic budget

Every single FOA or RFP is going to ask you to submit a budget. Remember, you can only ask for the maximum of the grant! If there is a federal grant that has a ceiling of $450,000, then you can only ask for $450,000. Don’t ask for $450,001. They will throw out your grant. Having said that you need to make sure that your project is realistic with the ceiling amount for the grant.

So, how do you figure out your budget? Well, a great starting point is to look at everything you have already developed. If you have your needs statement, goal(s), S.M.A.R.T. objectives, and sufficient activities for making it all happen, you now have your entire outline for your budget!

Make sure you include any connections between your activities and your budget. If you are hiring staff as an activity, make sure you add it in your budget and vice versa. If it’s in your budget, make sure you have an activity line for it. 

Your categories should include the following, unless specified by the RFP or FOA that they want it in a different way! (Then follow that!) However, this is the format most federal agencies will use and many times foundations do not give you a format.

  • Personnel
  • Fringe Benefits
  • Travel
  • Equipment 
  • Supplies
  • Consulting/Contracting
  • Other
  • Indirect
  • Total

Our example we’ve been using is a nonprofit in New Mexico that serves pregnant teens and teenage parents.

In episode 84 we devised a problem statement: 

The teenage pregnancy rate in New Mexico is the highest in the nation, with 62 out of 1,000 teenage youth pregnant compared to the U.S. average of 18.8 (CDC, 2017). 

We then went onto Episode 85 and articulated the goal as: 

The Project will increase fiscal management and job wages for pregnant teenagers and teenage parents.

In episode 86, we devised three objectives: 

  • 100 pregnant youth or teenage parents will receive 20 hours of financial literacy training by July 31st, 2020. 
  • 75 pregnant youth or teenage parents will have completed their GED or High School diploma by June 30, 2020.
  • 20 pregnant youth or teenage parents will be employed by December 31st, 2020.

In episode 87, we developed a timetable for activities to reach objective one that included the following: 

Problem Statement: The teenage pregnancy rate in New Mexico is the highest in the nation, with 62 out of 1,000 teenage youth pregnant compared to the U.S. average of 18.8 (CDC, 2017).
Goal: The Project will increase fiscal management and job wages for pregnant teenagers and teenage parents.
Objective One: 100 pregnant youth or teenage parents will receive 20 hours of financial literacy training by July 31st 2020.

Activities

Description

Lead Person Start Activity End Date

Measurement

Hire Project Coordinator Executive Director Oct 15, 2019 Oct 20, 2019 Hiring of PC
Partner with Financial Institution Project Coordinator Oct. 20th November 30th Development an MOU with partner
Create an digital awareness campaign Project Coordinator December 1st  December 31st Number of ads, awareness campaign completed
Create a selection process for youth Project Coordinator November 15th December 1st Criteria process created
Recruit youth through online campaign Project Coordinator January 1st  February 28th Number of youth recruited
Commence cohorts (each cohort of 20 youth and 5 hours per week for one month. Project Coordinator & Financial Partner March 1st  July 31st 100 pregnant youth and/or teen parents completing 20 hours of financial literacy

Now let’s see what our budget would look like for objective one:

BUDGET LINE BY LINE WORKSHEET

PERSONNEL

Position Title Computation (Hourly rate x # of hours) 

Grant Request Total

Executive Director ($35 per hour x 2080 hours) x 5% $3,640
Project Coordinator $25 per hour x 2080 $52,000
Personnel Subtotal The sum of all personnel $55,640
   

FRINGE BENEFITS

FRINGE BENEFITS Rate

Grant Request Total

FICA Multiply the total of the personnel salary by 7.65% $4,256 
Workers Comp Multiply the total by 1.5% $835 
Fringe Benefits Subtotal   $5,091
   

TRAVEL

Type  Computation 

Grant Request Total

Mileage for driving for work Driving the van for five months – average 100 miles per week x 20 weeks x $ .535 per mile.  $1,070 
Travel Subtotal   $1,070
   

EQUIPMENT

Items Computation

Grant Request Total

One Minivan Purchasing a minivan $20,000 
Equipment Subtotal   $20,000 
   

SUPPLIES

Types of Supplies Computation

Grant Request Total

Consumables Paper, staples, ink, cleaning supplies at $100 per month x 12 months $1,200 
Supplies for financial literacy training 110 pax x $25 book  $2,750 
Participant supplies  Incentives such as gift certificates, pens, etc. @ $10 per 110 pax $1,100 
Supplies Subtotal   $5,050 
   

CONTRACTUAL

Types  Computation

Grant Request Total

Digital Advertising 2 months x $1000 $2,000 
Financial Consultant 100 hours at $25 per hour $2,500
Contractual Subtotal   $4,500 
   

OTHER

Types Computation

Grant Request Total

Computers $1,000 x 1 computers $1,000 
Room for financial literacy  150 sq. feet at $25 per hour for 100 hours $2,500 
Internet  $100 per month x 12 months $1,200 
Other Subtotal   $4,700 
   

TOTAL DIRECT COSTS

  Computation

Grant Request Total

Direct Costs Subtotal Add up all subtotals  $96,051 
   

INDIRECT COST

Indirect Cost Rate   Grant Request Total
10.00%   $9,605
   
TOTAL COSTS  Add up Direct Costs with Indirect Cost Rate $105,656 

So, there you go! That is how you create a strategic budget that aligns with all of your activities. Of course, you would hash out your other activities for your other two objectives as well.

You can see how simple this really is and that budgets do not need to be rocket science! 

That wraps up our G.R.A.N.T.S. Formula! Please subscribe to the podcast so you can make sure you get next week’s episode delivered right to your podcast player as I have a special guest on from Nashville! Also, be sure to check out our YouTube channel! 

Let me know how you liked the G.R.A.N.T.S. Formula by sending an email to [email protected] Also, if you want the G.R.A.N.T.S. Formula downloadable, be sure to download it here!