All About Budgets

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What goes into a budget? Every budget has two sides, income and expenses. That’s it.

On the income side, write down every way you expect money to come in. That could be grants, ticket sales, donations, merchandise or workshop fees, sponsorships, or in-kind support.

On the expense side, list everything you’ll need to spend money on. That usually includes artist and staff pay, venue or tech rentals, costumes, sets or supplies, marketing and outreach, access costs, insurance or admin expenses.

When you lay income and expenses side by side, you see your net. Whether you’re planning a profit or a loss, the goal is to be as detailed and realistic as you can. Don’t just budget the fun stuff like costumes and sets. Include staff time, admin, and access, because those are costs too.

Why does it matter? Because the detail helps you see the bigger picture. Are you depending too much on one income stream, like a single grant, or are venue costs eating up more than they should? Are you constantly moving things back and forth just to make the numbers fit?

A budget isn’t about guessing perfectly. It’s about giving yourself the clearest possible roadmap so you can understand how the money will move and make stronger choices along the way.

What is a budget?

A budget is an educated guess of how much money you expect to bring in (income) and how much you expect to spend (expenses) over a specific period of time. You might make a budget for a specific project or program, or one for your organization overall.

Take a look at this example to get a quick picture of what a budget for a small arts organization might look like.

Where do I get a budget template?

To make your budget, a spreadsheet is your best tool. You can use Google Sheets, Microsoft Excel, or spreadsheet programs from OpenOffice or LibreOffice. The key reason to use a spreadsheet instead of a text-based Word or Google Doc is that a spreadsheet will do the calculations for you! This saves you time and mental energy and makes it easier to catch mistakes. Plus, you can see how you got to an amount when you’re looking at your budget spreadsheet later.

Check out the templates in the Sample Download section below.

What goes into a budget?

Budgets have two main sections, one for income and one for expenses. You might see these sections called “Revenue” and “Expenditures”. These mean the same thing as “income” and “expenses”.

Both sides (income and expenses) should be broken up into categories that are useful for you, your collaborators, and your funders. It’s a best practice to use your Chart of Accounts for your categories. That way you can make an apples-to-apples comparison between what you plan (budget) and what actually happens (profit & loss) – more on that in the Budget vs Actuals learning guide.

On the income side, think through all the different ways you plan to bring in money for your project or organization. These might include donations, ticket sales, and grants. Each type of income should have its own line in your budget. Put the category name in one column and the amount in the column next to it.

For expenses, think through allllll the different things you need to spend money on in order to carry out your tasks. That means including all the admin costs like office supplies, utilities, and insurance, in addition to the costs that are directly tied to your programs, like costumes, artist fees, and sound techs. Put the category name in one column and the amount next to it.

Pro Tip: use a third column to write out in words how you got to your numbers. This is helpful for your future self, your collaborators, and your funders. You don’t need to morally justify why an expense is needed, just give the facts of what the expense is for. For example, if you plan to pay $4,000 to teaching artists for holding workshops, your explanation column for that line might say something like, “$250 per workshop x 4 workshops each x 4 teaching artists”.

Where does a budget come from?

Your budget is just that – YOURS! So the numbers you put in should be ones that make sense to YOU. There is no such thing as a “perfect” budget — it’s your plan for what you expect to happen in the future.

If you’re planning to re-do something you’ve done before, a helpful starting place is to look back at what it actually cost last time. From there, you can make adjustments based on anything that’s changing this time around.

If you’re planning something entirely new, do some research to find out how much things cost and how much you can realistically expect to bring in. You can ask around to friends and colleagues who’ve done similar things, look at what other organizations charge for admission to similar events, or crowdsource for answers on social media. Just remember to adapt what you find to your specific situation. Venue rentals in Des Moines are way different than in Chicago!

What should I look for in a budget?

The two main questions to ask yourself are: is this budget complete and are these numbers realistic?

“Complete” in this context means you’ve covered all your bases. For example, if you’re bringing in performers from out of town and you’ve planned for airfare and lodging, did you also remember to include local transportation, like how they’ll get from the airport to their hotel and back? If you’re collecting donations or selling tickets online, did you factor in the fees that those platforms will charge you?

“Realistic” can be trickier, because a budget is only a guess. You don’t need to worry about being off by a few dollars. But, are these numbers based on real research you’ve done, or did you make them up in a panic the night before a grant application was due? We’ve all been there. Set yourself up for success by building a budget with numbers that are the right size for the project you’re working on. For example, if you’ve done a similar program before and you sold out a theater with 250 seats, it’s realistic to think you could increase that the next year to 300 or 350, but jumping to a thousand would be a stretch.