Grant Writing Hack: Write Your Budget First

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When I first began writing grants, I always saved the budget for last. To me, it made sense to write the application, determine exactly what I wanted to do, and then retrofit a budget to match my plans. A few years ago, I attended an advanced Federal Grant Training and I learned something that revolutionized my approach to grant writing. The very first thing they taught us was to “always write your budget first.” While I was initially skeptical of the idea, I left the training a believer.

Consider this – if you were going to buy a new house, you wouldn’t start shopping (or at least you shouldn’t start shopping) until you know your budget. Imagine looking at your dream home and then realizing it’s $100k more than you can afford! Every house after that is going to feel disappointing. Or worse yet, you go through with purchasing that house and then discover 6 months later that you can’t swing the mortgage. Yikes! The same is true with grants. You may write an amazing proposal and then realize it costs way more than the available grant funds to pull it off. Or, you commit to some ambitious program goals, you get the grant, and then 6 months into the performance period you realize that the grant funds aren’t actually sufficient to pay for your costs.

From experience, I believe that these pitfalls can be avoided by starting with the budget first. A good budget draft serves as a litmus test for the entire proposal. When you start setting goals, activities, milestones, etc. the budget tells you what’s truly possible. For example, if you have a goal to provide a certain number of trainings
per year, your budget helps you determine what that target number should be.

Now you might be saying to yourself “sometimes I don’t know what something is going to cost until further along in the proposal process” and that can be true! You may have to wait for a vendor to return a quote, or you’re waiting to determine the supplies you’ll need based on other factors. In these cases, start with what you do know. Consider the following example for a $100k grant to provide Mental Health trainings for one year:

Item Detail Known Information Amount
Personnel .50 FTE at minimum .50 FTE Project Director is required by the grant funder $40k
Benefits For a .25 FTE Organization’s fringe rate is a standard 30% $9k
Indirect 10% flat rate The funder only allows a 10% indirect rate $10k
Trainer $1,000 per training The grant requires at least 10 trainings $10k
Supplies $50 per manual At least 10 people will attend each of the 10 trainings $5k
Current Total $74,000
Remaining Balance $26,000

In this example, I know for certain that I need at least $74k to 1) meet the minimum requirements of the grant and 2) cover my costs. This tells me that I have $24k remaining to build into my program design. I can now decide if I want to provide more trainings with that money, pay for advertising, purchase a new laptop, etc. I would not know the scope of my program-design flexibility if I waited until the end to write the budget.

So, next time you start a grant proposal, consider writing the budget first! It just might save you a world of trouble in the long run.

Written by Kate Hoeflein, Grants Manager, Care Compass Network


Additional articles of interest: Grant Writing Hack #1: Learn from Winners