How to Make Project Budget in 3 Steps

how to make project budget in 3 steps

How to Make Project Budget in 3 Steps

How to Make Project Budget in 3 Steps 1400 912 Gedas Kondrackis

Are you also wondering how to make project budget? It might seem a daunting task. And, we feel you!

That’s because there are a lot of blank spaces in project budgets at the beginning. Which might be no better than looking at an uncharted map. Gladly, there is a fool-proof way to go about this dirty business. Moreover, it is no longer than 3 very simple steps!

Reading time: 3 minutes
Briefly: we demonstrate an easy 3-step way to make a budget for most project proposals for social initiatives

1.     Start by listing the project’s activities

Note: to complete this step you would need to know what activities are planned in the project. If in need for some help in making a perfect project plan (with activities, outputs, etc.) – check out this comprehensive guide on project design.

You should start by writing down all the activities in the project (e.g. list them in a column). We need detail here, so if the activity can be broken into smaller parts – do it. For instance, in the table below we are breaking down the project’s research into “Research in the project countries” and “Research report”.

Project activities
Kick-off meeting in Vilnius (1 pax / country) (length – 1 day)
Research in the project countries
Research report
Multiplier event (20 pax in each country) (presenting research + promoting pilot)
Pilot programme events (5 per country) (15 pax each)
Documenting the pilot
Creating methodology (based on the pilot)
Multiplier event (20 pax in each country) (present. methodology)

Congratulations, step 1 is done!

2.     Add the types of costs to your budget table

Step 2 is just as easy. You need to look at the possible cost types for the project call (e.g. Erasmus+ or Norway Grants) you are applying to. In our example we are going to use an imagined project call – Erasmus+ KA4 Youth in Quarantine (because it is 2020 and we are once again under lockdown). This ‘project call’ has 3 possible expense types: 1) travel & subsistence costs to meetings; 2) participants in multiplier events; and 3) staff working days for intellectual outputs.

Once you have the cost types, list them in a row. Like this:

Cost types: Travel costs + subsistence Participants (in multipliers) Staff working days

Note: this example is, obviously, an oversimplification. Yet, even with more types of costs available, the approach remains more or less the same.

3.     Execute! I.e. make the project’s budget

At this point you already know the activities in the project (step 1) and the types of possible costs (step 2). What’s left is to simply fill the table in (for instance, using the norms given by the project call or taking norms based on your experience). In other words, for every activity add the expected cost.

Note: by norm we mean a sum of money that is normally paid for a certain activity, service or product, etc. For example, a short-haul round-trip flight (on economy class) within the EU would normally cost around €180. Thus, €180 is the norm for such travel and we can assume that all flights (that fit the above description) will cost that much. Salaries can also be paid according to norms prevailing for certain work (e.g. a youth worker receives €75 per working day in Lithuania according to Erasmus+ daily norms).

In this example we will assume that: there are 3 organisations in the project (1 from Lithuania, 1 from Estonia & 1 from Latvia); the multiplier events & pilot programme events are only for local people (meaning no travel costs).

Sample project budget table
Project activities (1st column) Cost types (top row) Travel costs + subsistence Participants (in multipliers) Staff working days
Kick-off meeting in Vilnius (1 pax / country) (length – 1 day) Local participant = €0

2 foreign participants = €180*2 + €100*2 = €560 in total

X X
Research in the project countries X X 10 researcher working days (wd) in each country = 3*10 *€75 = €2250
Research report X X 5 researchers’ wd & 5 designer wd = 5*€75 + 5*€55 = €650
Multiplier event (20 pax in each country) (presenting research + promoting pilot) X In each country:

Rent – €200, snacks – €100, ads – €250, organisation – €375. Total: €925 * 3 countries = €2775

X
Pilot programme events (5 per country) (15 pax each) X Rent – €200, snacks – €100. Total: €300 * 5 events * 3 countries = €4500 5 youth worker wd per event = 5 * €75 * 5 * 3 countries = €5625
Documenting the pilot X X 2 technician wd per event = 2 * 5 * €55 * 3 countries = €1650
Creating methodology (based on the pilot) X X 10 youth worker wd & 5 designer wd = 10*€75 + 5*€55 = €1025
Multiplier event (20 pax in each country) (present. methodology) X In each country:

Rent – €200, snacks – €100, ads – €250, organisation – €375. Total: €925 * 3 countries = €2775

X
Grand Total: €21,810

We have got the expected costs (for each activity) by doing only minor calculations (e.g. number of participants * the norm for travel costs). After that we add all the costs together and get the grand total.

Once again, this is a simplified example. But even in more complex budgets the concept remains the same. So, next time someone asks you how to make project budget – smile and share this secret 3-step technique with them 🥋

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Gedas Kondrackis

A for-purpose entrepreneur bent on bringing 21st century tools and techniques to the NGO world.

All stories by : Gedas Kondrackis

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