1. Back to Basics
BUDGETING FOR CLUBS
#Optimist100

2. INTRODUCTION ARTICLE VIII Optimist International Finances
SECTION 6. Budget
Adequate  financial records
Fundraising
Proper planning and management of financial resources
Introduction
Optimist International requires that as Optimists, we engage in a process of keeping adequate financial records. Tough we are a voluntary service organisation, it does not preclude us from operating within a business mind-set. In fact, it behoves us as volunteers working in charities to be even more responsible with the funds given to us by our members and our communities in service to our children. Financial records must therefore be not only prepared but easily understood.

3. income and expenses WHAT IS A BUDGET?
The budget is developed to provide guidance to where and how to spend the club’s funds.
A budget is a financial plan that takes income and expenses into account and provides estimates for how much you make and spend over a given period of time.
Simply put, one cannot think about budgeting and not think about revenues. And yet, too often we are caught up with the spending side only, the expenses.
While it is always good to know what a project is going to cost, what you are going to be spending, it is also very critical to consider what you have to spend. The estimates of expenditure must be supported by a plan for earnings.
The aim is to create a balanced budget, and I dare say, in Optimism a ZERO BALANCED budget is not only encouraged but is desired. All our monies must be used to meet our obligations to our programmes and projects. In other words, even the idea of a surplus is to be cancelled out by assigning that to specific future spending.
income and expenses

4. WHAT IS A BUDGET? Needs vs Wants Planning tool Financial management
The act of budgeting requires us to assess the financial situation and make a distinction between needs and wants. You may want to, for example, serve meals at club meeting but can you afford to? Do you really need to? If you want to do something but cannot afford it then forget it; but if you need something then budget for it and make it a priority.
The most fundamental way to think of a budget is to treat it is part of your planning mix.
Budgeting is a planning tool. It helps to keep you focused on both the inputs and the outcomes of your objectives. If you do not properly manage the expenses related to your overall plan for success, then as obvious as it sounds, you will have failed. Many projects do not meet their success levels because they were not properly budgeted.
So, budgeting is about financial management. It speaks to planning. It speaks to integrity. You should not spend what you do not have or intend to earn. It speaks to checks and balance. It speaks to resourcefulness. Budgeting is also about leadership and character.

5. 4 step budgeting Define costs Assess revenues Make the budget
Set goals, projects
Define costs
Assess revenues
Make the budget
Budgeting is a very simple 4 step process;
Set goals
Establish which projects will be completed
What will those projects cost?
What will be the revenue sources to cover the project costs?

6. STEP 1: Identify Your Goals
Start with your club goals. These are the fundamentals to determining your overall financial health.

7. $$$$ Identify Your Goals International and District Programs Meetings
The club’s financial obligations
International and District Programs
Meetings
Club fitness program
International and District fees
OIF/CCOF contribution
Support for Club officers?
$$$$
As a club what are the major activities that you must consider in your goal setting:
Look to the Optimist International Programmes – scholarship programmes, sports, childhood health and education, etc…
Look to your meeting obligations: Business meetings, Zone meetings, District meetings and convention, International convention. Who will attend? What is the level of club support?
Look to your club fitness programme: membership growth, new club building, PDP/PGI and NOW activities
Look to your established financial obligations: District dues, International dues, Registration fees for presidents and STs, Insurance, OIF Contribution.

8. What are your revenue streams?
Step 3: Check it…
Basic items of Revenue for an Optimist Club:
Membership Fees
Annual Dues
Prepaid Meals
Other Income
Fundraising
What are your revenue streams?
STEP 3: Review Your Financial Sources
Remember, the budget provides a guide to where and how you should spend the club’s funds.
What are the established sources of income for your club? Where are your revenue streams? How certain are these streams?
There are five basic items of receipts for an Optimist club:
Membership Fees: What is the goal for new membership? If there is not a strong growth strategy then obviously this will not be a reliable source of revenue.
Annual Dues: How many members are on roster at the minimum 100USD (suggested rate for healthy club)? You should also consider in your review, the compliance rate of the membership.
Prepaid Meals or Refreshment: Sometimes this is paid in the dues or taken at meeting; but this is also an area that is difficult to predict.
Other Income: Some clubs may have annual endowments, members’ pledges. How about income from advertising in your club bulletin, or internal fundraising such as fines, door prizes, raffles etc.
Fundraising. Of course, this is a major area for consideration in most clubs. After all, Optimists are involved in voluntary service projects which will require major funding. It is expected therefore, that fundraising activities are held to support service projects with the youths and the communities. The funds raised for such projects or charities must be used for same.
You should try as best as possible to develop a fund raising strategy in accordance with the need to balance the costs identified in step 3 with the already established income streams from step 2. In other words, let your fundraising strategy be aligned to addressing the gap between your projected income and expenses.
ACTIVITY 2: Review your current Receipts with as much details as possible.

9. Step 4: Do It… Know your basic revenue sources and expected expenses
Make it simple and easy to understand
CLUB/PROJECT BUDGET
STEP 4: Create the Budget (Do It)
So, first step is to take your club goals from which will come your objectives. From your objectives flow the activities out of which you determine the inputs for success. Putting an estimate of cost to those inputs is the second step in your budgeting. You then assess what you have – what are your starting resources – in relation to what your needs are. You should now have a better sense of the basic inflows and outflows which are the fundamentals of your budget planning.
The final step is creating the budget – taking the information you have from steps 1 to 3 and putting it in a simple easily understood outline, template or framework.

10. Create the budget Youth Activities Community Service
Convention Delegates
Insurance
Fellowship and Hospitality
Miscellaneous
Contingencies
International Dues
District Dues
Processing Fees
Supplies
Communication
OIF Contribution
Meals
You have already identified the main categories of the Receipts, now let’s look at the main categories of your Club Disbursements:
International Dues
District Dues
Processing Fees (for new members)
Supplies (pins, badges, certificates etc…)
Communication (printing, stationary, telephone, official club documents such as letterheads, envelopes etc., club bulletin, websites, social media platforms...)
OIF Contribution
Meals
Youth Activities and Community Service (This is where your cost defining exercise will be most helpful. It is also the item around which most fundraising is designed. You may need to break out this item into sub sections representing the various programmes and projects)
Convention Delegates (District and International)
Insurance
Fellowship and Hospitality (Too many of our clubs overlook this little but significant area of club life. And yet, it can be such a big part in membership engagement and retention, especially in recognising our members. Take a look at the 100 ways to Celebrate Your Members workshop.
Miscellaneous (bank charges, audit fees, etc…)
Contingencies (This item is not to be used arbitrarily but for considerations of exigencies. Try to keep this within a reasonable percentage of the overall budget and should be considered based on experience and assessment of risks)

11. Happy Budgeting Conclusion:
The budget is a guidepost. Get into the habit of comparing real or actual versus the estimate each month and make the requisite adjustments. Be reminded that all adjustments to the budget must have full board approval and should not be made more frequently than once a quarter.