Hopefully, most of us are accustomed to using budgets to guide us in our personal finances. A budget is an important tool for us to manage our money. A personal or family budget is a fundamental part of good financial management. Our budgets should reflect our goals and priorities. Our budgets should also reflect our best estimate of our projected income and how we plan to expend our income. Our expenses can usually be divided into fixed expenses, and those expenses that change from month to month. Our expenses should also align with our goals and priorities. Our budgets should be flexible enough to adjust to changes that can occur during the year. When significant changes occur to our financial situation, we need to take the time to reevaluate our budget, as well as our goals and priorities.
A budget is not just for our families and personal lives. PORAC and each of our local associations operate on a budget. The annual process of creating our association budget is an important and critical part of achieving the missions, goals and priorities of our organization. PORAC’s budget process begins long before the Annual Conference of Members each November; it begins at the start of each year and continues throughout the spring, summer and fall. Committees and the Board of Directors spend the majority of the year working through draft budgets before finally presenting them to the membership. Your local association budget should go through an equally rigorous process. The Board should start the process by setting the association’s goals and priorities. A budget or finance committee should use those goals and priorities, along with historical expenses and anticipated changes, to create a draft budget to be presented to the full Board of Directors for review. If additional changes are needed, they can be made at that time. Eventually, a finished product is ready for implementation.
Once a budget is approved and put into place, the process is not complete. Our budgets are living documents that should be constantly reviewed and even changed when needed. Over the past few months, a lot has changed in the world. Now is the time for us to assess those changes and the impacts it will have on our personal and association budgets.
In our personal lives, we may have seen changes in our monthly incomes. For some, that might be an increase associated with additional overtime opportunities. For others, it might be a decrease in income as departments cut back on overtime, and perhaps even furlough or lay off employees. We may also have seen a loss in family income as our spouse’s income is negatively affected by business closures. We also need to review our expenses. We may have seen increases or decreases in expenses associated with closures and changes to our work schedules and our children’s school schedules. Take time to review these changes in income and expenses and make sure you are using your financial resources in ways that match your family’s goals and needs. If you are fortunate to be seeing an increase in income, realize that it is likely short-lived and take this opportunity to save some or all of that increase to protect your family against any economic downturns that may occur.
The same steps should be taken by your association. If you are in a leadership role in your association, now is the time to be checking and reviewing your association’s budget. Consider how changes in your city or county’s budget may affect staffing and how those changes could affect your association’s dues income. Will your association members have a greater need for association services this year as a result of a changing world? Have your association’s priorities changed? Is there a greater need to focus on member wellness, including both their physical and mental health? Once your association has reassessed these impacts and changed its goals, make the changes you need to make to your budgets.
A budget is important to keep your association on track. It is not a document to review just once a year. Make it a habit to know your budgets and make the changes needed to adjust to life changes that can occur.