With the start of a new school year, the changing of another season and preparation for a flurry of holidays, fall is a time of renewal and energy buildup to make it to the end of the year.  Nonprofit organizations are doing much of the same gearing up as they head into full fundraising season. Meanwhile, nonprofit Board of Directors are getting ready to develop and approve the coming year budget.  With all the personal and organization activity it can be difficult to focus on such a arduous task. Yet it is the one of the most important tasks a Board of Directors takes on each year.

So how can boards make this process easier and ensure they can predict what the priorities of the next year will bring?  The keys are in the planning and awareness of the past and present of your nonprofit. Here’s some tips that can help ease the process as you create the next year’s future of your organization.


Many nonprofits have an ongoing financial committee that meets at least monthly during the year.  In addition to reviewing the fiscal policy, the financial committee can track the success of the operations, programs and fundraising activities of the organization.  By looking at the details of the current spending, financial committees can offer thoughts and ideas on how to improve these areas of the nonprofit. A financial committee can help determine if a fundraiser should continue, a program should be modified due to lack of income generation or cost analysis.  With that said, not every fundraiser or program should be scrapped if they don’t mean a fundraising goal or are an expense part of the organization. These can be valuable for the public awareness aspects or meeting the true mission of the organization. Since there are many factors in determining what is best for the organization, a financial committee can be helpful in providing pertinent insight into the inner workings of the organization and the advice used to inform the upcoming priorities for the year.


In all the work of the nonprofit, the mission is key. This is a great time for the board to make sure each program and fundraiser is in line with the purpose of the organization.  Often times the organization may have programs that are no longer meeting a need in the community or became part of “mission creep”. Mission creep is common when new programs are created to obtain grants or meet a specific need in the community that may no longer be necessary.  Reviewing and sticking to the mission is an important part of determining the priorities for the next year. Sometimes an organization may find that they need a whole new mission statement because the one they have is outdated or not clear in the priorities of the previous years. This process should not taken lightly and if in question is a great time to seek advice and/or professional help in guiding the creation of a new mission statement.  The primary goal is to keep the organization mission aligned with its operations, programs and fundraising activity.


This process can be pretty simple when you are an organization that has been around for many years.  The exception to this is when a long-standing organization is trying to lower expenses in operations and programs or even fundraisers. If an organization is trying to keep expenses in check it is good to review the past several years of individual parts of the organization and compare the trend.  Was the increase in expenses gradual and in line with the income of the organization? Was there a time where expenses made a sharp increase for an activity and never brought back into line with the overall budget? Review of these areas when determining where to make budget cuts can be helpful in ensuring activities are properly funded.  

I work frequently with new nonprofit organizations that don’t have a history of income and expenses.  They often struggle with determining how to predict the amount of activity will occur in operations and programming and how much it costs to run a fundraiser.  The good news is there is a history of similar activity occurring with other nonprofit organizations that can assist in determining expenses in a new nonprofit.  New nonprofits benefit from clearly identifying the needs of the organization in addition to the community need for its services and funds. If your nonprofit hopes to pay staff in the coming year, write that into your budget expenses and then determine the various income sources you will needed to accomplish that goal. Do this every aspect of your nonprofit and keep to what you WILL accomplish in the new year.  This becomes very important if you want to obtain grants in the near future. Foundations like to see organizations that have kept in line with their mission and organization priorities and the budget is a great way to show you have accomplished your priorities within budget.


Budgets should be hopefully realistic. Passion may drive a desire for idealistic priorities and this can be good when raising money to meet the true needs of the community you serve. The challenge arises when idealism surpasses actual results.  This can negatively impact the view of an organization that does not have goals they accomplish throughout the year because the budget and activities of the organization where beyond the capacity of the organization. Capacity of the organization, a common buzz term, includes number of volunteers, staff and collaborations needed to meet the mission of the organization.  Capacity can include your organization office space and how many can work in the space or how much time it takes to raise money. Having everything you need to deliver your organization mission and programs is key to developing a strong budget for the new year.

Budgets require time and attention to develop.  Making it a year round activity that is informed by and past and present experiences will help to create a less stressful new year that aligns your budget with your nonprofit’s mission and goals.