Budgeting is the process of balancing expenses with your income. It is simply making a plan to spend your funds. Budgeting helps you to look at your estimated incomes and expenditure for a specific period in the future. School/college’s budget needs to be given special attention to implement programs as per set plan and objective, facilitate the proper administration of revenues and make the budget a basis for accounting for funds spent to gain educational objectives. 

It is the objective, motive, and purpose of the establishment that makes educational institutions different from other organizations. For instance, if schools and universities are run by private sectors, part of their motive is profit. Organizations also may be established for various actions and motives. They are guided by different agendas. Those agendas can be social and political as well. It is their goals that make them different from each other. Mostly, they are profit-oriented be it an educational institution or other organizations

Why is it so important?

Budget is important to help you make a spending plan for your money. It is helpful to make sure that you will have enough funds for the things you want and the things that are most important to you. Having a proper plan on spending money will ease you to be out of debt. It aids to make sure whether you will be able to continue working at your estimated incomes and expenditure or not. In order to utilize the remaining funds wisely, you need to have proper planning on spending. 

Difference between school/college’s budget and other organizations 

• More than 80 percent of the school/college’ budget will be on personal and benefits
• For improvement and innovation, they will have only 20% that might lead them to trouble
• Their expenditure will be strictly controlled by government policies
• Organizations spend less than 50% on personal and benefits

Why do schools/colleges need a budget?

• A well-planned budget helps colleges and schools to control the way they spend money
• It is helpful to meet your school’s target and objectives 
• It is essential to have a budget plan for forming the basis of accounting and making institutions 
• If you want to provide an efficient allocation of resources, budgeting makes it possible
• It is a budget that guides you in determining the quality of the services in any organization or institution
•  Your schools’ goal is achievable only through budgeting programs
•  Budget makes administrators or educators aware and cautions against unrealistic optimism. 
• If you like to avoid any chaos and confusion in your school/college, have a proper budget planning

Following are 6 effective tips used by educational institutions around the world for creating and managing an effective budget.

Aligning with your school improvement plan

While planning a college/school’s budget, always try to align it with your institution’s plan. You will have a clear idea of your institution’s goals by linking your budget setting with the college’s improvement plan. This practice aid you in ensuring that you have the resources in place to make improvement and maintain high standards of education. It will help you to know the quality of education in your school and college’s current financial conditions. 

Welcome disagreements during the planning stage

When you make a budget plan,  always expect disagreement between and among the leader of your institutions. Note that disagreements are a part of the process and must be welcomed. Different perspectives always help to come to a good conclusion. Involving various inputs in the discussion will help administrators set a realistic budget and can foresee future debates and problems during the execution phase. You can make a better plan to achieve your aims based on these observations. 

Do your Homework

Almost all school receives various funding depending on their location, sector and school profile. You need to make sure that you understand all the different fundings available and if you are eligible for additional funding. Then you will also need to keep a record of historical spending and think about what effective steps can be taken to reduce your college’s expenditure. 

Set out your objectives

If you try to achieve what you want, it’s important to set out your objectives.  To gain your targeted goal, always make sure that your objectives are matched with the resources you want to achieve. You can have greater control over money by pairing your objectives with your spending. Always try to avoid unplanned spending to keep better track of your expenditure.

Use technology

The best way to combine all the information and reports into one place is technology. It can be stored and updated at any time for now and future references. In order to review your previous budgets, extract and important data from your financial management system, it is necessary to make good use of effective budget software. Always use software for a faster and effective budgeting process. 

Know that your budgets are accurate

You have to make sure that data from previous years are accurate to make your future figures correct. It helps to make a comparison of your present budget report with the previous one and make further plans accordingly. It is also helpful to make accurate predictions and ensure that your cash flow is not out of budget. Having the data of the number of students,  and staff costs from previous years will help you to see may need more budget to be allocated