It’s that time again. Time to start thinking about your annual budget. Whether your community runs on a calendar year budget or one that cycles from fall to fall (like many organizations), budget planning should be a top priority for managers facing a new year ahead.
There are a lot of reasons a well-planned budget is critical to your success. For me, it’s really about being prepared, which allows you to be ready when things change or unexpected challenges appear on the horizon.
This month is the perfect time to begin detailed work on your budget for 2022, especially if you run a calendar year financial plan or need to submit it to government housing authorities, HUD or other forms of boards and advisory councils.
Use the coming weeks to review the state of this year’s budget and how that may impact what you want to do next year. Also, use this time to dream a little. In other words, consider things you’d really like to achieve, if the circumstances are right and the money is available.
Keep an eye on the timeline
One thing to pay close attention to, whether you’re “dreaming” or just being realistic about next year, is your approach to capital improvements. If you know there are specific things that will need to be completed next year, get started now. Fully develop ideas of what the capital work will look like, contact vendors for insights and begin to get quotes from contractors. This will help shape the year ahead and give you a better sense of what can be done as opposed to what needs to be done.
Besides capital improvements, I love to remind our management teams that things like advertising and marketing to find new residents, as well as events and activities to retain current residents, require thoughtful consideration. Look at each month in the coming year and focus on whether any of these things apply: will you be having an event to welcome in spring? What month might we advertise online to garner new residents? By looking at it in smaller segments you will be able to dig deeper into potential costs and budget more effectively.
Two other big budget considerations are often related to capital improvements, but not always necessary: apartment upgrades and “curb appeal” enhancements. This is an area with a wide spectrum of possibility that requires thoughtful review, focused planning and, again, crunching specific numbers to make them happen.
We all know upgrades tend to be on the expensive side, but if it’s time, or will be soon, budget planning is critical to develop a way forward that actually makes this possible.
When it comes to curb appeal, there are a lot of relatively simple options that don’t often cost as much as you might think, but will still require your attention and planning. Curb appeal is very important, showcasing the community you manage and helping build retention and potential new residents. To budget for it, consider a few areas: landscaping, signage, lighting, painting, road surfaces and anything that adds to the look and feel of the community.
If you don’t have budget line items for any of these areas, consider adding it in as you plan. Perhaps they are connected to capital improvements, and while that is fine, they can often be more like maintenance items.
Another area to review closely is technology. This can be a costly item for any organization, and often it requires a long lead time to make even simple changes. Get a handle on your technology needs now as you prepare your new budget.
Involve everyone for success
Lastly, since people are often affected by budgets, involve them in your planning – don’t try to do this alone. Financial issues scare a lot of people. Don’t make that you. Budgets are no different whether they’re your household budget, one for your department or that of an entire organization.
To develop a more comfortable approach to budgeting try the following: research everything, challenge current assumptions about this year as opposed to next and be bold in some areas, fiscally conservative in others.
Most of all, remember we are stewards of our communities, giving people a place of comfort, safety and a feeling of belonging.