- Our Approach
- Accounts Payable
- Accounts Receivable
- Fractional Controllership
- Professional Services
- Food and Beverage
- Gyms & Fitness Studios
- Healthcare Organizations
- Case Studies
How to Prepare a Budget for a Grant Proposal in 3 Steps
Omar Visram / CEO and Co-founder
April 4, 2022 6 mins read
Blog / Accounting
In Canada, there are many grants and funding opportunities open to nonprofit organizations and growing businesses. Some are specifically designed to support hiring or skills training, while others are geared toward social development programs or innovative research projects.
Because grants are non-repayable funds provided by a corporation, trust, foundation or governmental department, grant approval is a competitive process. The funder you apply to will want to know how you’re planning to spend their money. So to substantiate your grant application, you’ll need to submit a high-quality grant budget as part of your proposal.
What is a High Quality Grant Budget?
A high-quality grant budget is a complete and accurate outline of your program or project costs and their eligibility under the grant you’re applying for.
Providing a high-quality budget as part of your grant application:
- Increases your likelihood of getting approved
- Makes it easier to run your program since you’ll know exactly how much you can spend
- Helps you prepare an accurate grant report faster when it’s time to report back to your funder
Writing a budget for a grant is not the same as creating your organization’s operating budget.
While an operating budget details your expected revenue and expenses for the coming year, a grant budget outlines the costs associated with the project you’re seeking to fund for the period of time the grant covers.
Not sure how to prepare a budget for a grant proposal? These 3 steps will show you the way.
How to Prepare a Budget for your Grant Proposal
Step 1: understand the funder's requirements.
Before preparing your program or research grant budget, check the format required. While some funders will allow you to use your own budget template, others will provide you with a template that incorporates their budget lines and categories.
Pro Tip : If you’re not required to use the funder’s template, align your grant budget with your organization’s chart of accounts to make future reporting easier.
Here are some other key points you’ll want to clarify before writing a budget for a grant.
What specific budget information do you need to provide in the grant proposal?
Does the funder want:
- Information pertaining only to the grant you’re applying for,
- Information about the program or project you’re looking to get funded, OR
- Your overall operating budget
If the request isn’t clear on their application, try to get clarification from the funder. Otherwise, it’s best to default to a program or project budget and provide information that’s consistent with your grant narrative (more about this later).
What type of expenses are eligible and what time period does the grant cover?
- If overhead expenses are eligible, consider adding an additional amount (~10%) to cover costs like your office space, computer equipment or website, or service providers like your outsourced bookkeeper or accountant. Some funders might set a cap on the overhead expenses permitted. Therefore, you should gain clarity from the funder about overhead expenses before creating the budget.
- Understanding the time period covered by the grant will allow you to create a similar timeline for your budget.
What level of detail is the funder looking for?
- If you’re asking for money to pay a salary, some funders will want to know who the salary is being paid to, how much time they’re spending on your program and their annual salary
- If you’re asking for money to pay for an event or gathering, some funders will want to know details like the specific date(s) and precise location
- If the funder does not require a detailed grant proposal budget, you should aim to keep the budget simple. The budget you provide will form the basis of your final report that you will submit back to the funder at the end of the grant. Therefore, it is in your best interest to keep the budget straight forward and only include information that adds value to the proposal.
Need help creating a grant budget?
Step 2: work with your teammates to determine costs.
Creating the budget justification for grants requires working with the team members who’ll be running your program or project to figure out their anticipated needs and the associated costs.
Note that the costs for running your program are considered direct costs, while any overhead expenses that support your organization’s infrastructure are indirect costs. Make sure you use “real numbers” that accurately reflect these costs as you determine what to include in your grant budget.
Here are some items to consider:
- Payroll expenses: Include details about how much time your program or research staff members will be required to spend on your project
- Material expenses: Provide a breakdown of the types and amounts of supplies that you’ll need
- Travel costs : Include information like the number of trips planned and the number of days and people for each trip
- Event costs: These may include the cost of renting a space for your event or hiring audio and visual equipment providers
- Catering expenses: If your event or program will be catered, provide details like the number of people attending and the cost per head
- Gift expenses: While often overlooked, fringe benefits like volunteer thank you gifts and honoraria for speakers should also be included
Here's an example of what you can include in a budget for your grant proposal:
Don’t forget that there may be costs attached to ensuring your program or event is accessible. If your program helps new Canadians work on their English, for example, you may need to budget for childcare for participants who are parents or a translator to help facilitate your program.
Remember: The more time you invest in researching prices, getting quotes from vendors, and checking that all your costs add up, the more accurate and reliable your budget preparation will be. Thoroughly reviewing the information you’ve assembled also ensures you’ll have the necessary resources and technology to successfully carry out your project or program.
Step 3: Make Sure Your Grant Budget Aligns with Your Narrative
In addition to your budget, most funders will want to receive a grant proposal narrative explaining the purpose and goals of your program or project, how it will be executed, and your anticipated outcome.
To improve your chances of getting approved, make sure your grant budget is consistent with your grant narrative. You can do so by checking that anything in your narrative with a cost attached to it is reflected in the budget you’ve prepared.
- If yours is a year-long program, your narrative should clearly state that the program will run for one year, and your budget should reflect the expenses for that same year
- If your narrative states that your program provides English classes to new immigrants, make sure your budget includes any translator payroll expenses, dedicated program staff time, or rental costs for space to accommodate your constituents
With the many funding opportunities available to your organization, it’s worth taking the time to understand how to prepare a budget for a grant proposal. If you need help creating an accurate budget for your grant application, Enkel can help. Contact us to find out how we assist businesses and nonprofits organizations across Canada with their bookkeeping, financial reporting and budgeting.
Ready for better financial reporting?
Our Takeaways from QuickBooks Connect 2023
What does global delivery look like at Enkel?
Glossary of Terms to Help Understand Nonprofit Financial Operations and Better Interpret Financial Statements
7 Tips to Draft a Compelling Budget for Grant Proposal
While financial support is crucial for conducting research, acquiring funds for your research is a challenging task and so is planning the budget for grant proposal !
The key requisites of a successful grant proposal are:
- Uniqueness of the research problem
- Best possible plan for solving the problem
- Appropriate budget planning
In an attempt to grab the attention of funders, researchers strive to submit innovative research proposals and often overlook other elements when creating a successful grant proposal. One such neglected section is the budget for grant proposals . It is important for funders to know how finances are being utilized. Therefore, adequately estimating how much the project will cost and how the finances will be distributed can make all the difference. In simpler words, your grant proposal must explain your request in both textual and numeral forms.
It is often a challenge for budding researchers to present an estimated cost of their research. However, remember that the grant budget is not an organizational budget! Furthermore, in today’s age of stiff competition, even senior researchers will benefit from improving their budgeting skills. In this article, we will discuss ways on how to draft a compelling budget for grant proposal.
Why is the Budget Section Important for a Grant Proposal?
A grant budget is important to paint the financial picture of your research proposal to the funders. The budget for grant proposal provides the following:
- Details of the possible expenditures for the proposed research project .
- Reassurance to funders that the researchers have a realistic sense of the expenses to complete the work proposed.
- List of other income sources for costs not covered in the grant proposal.
- Guarantees an optimal use of the funds.
- Makes practical implementation of the research project smoother.
What Constitutes a Budget for Grant Proposal?
An estimated budget quantifies the financial plan for possible expenses during the research project. The budget for grant proposals must demonstrate and serve a plan for funders on how the researcher/s will utilize the money for both operational aspects of the project and miscellaneous expenses associated with the research.
In order to stand out from other applicants, researchers can customize the budget for grant proposal as per the funding agencies’ guidelines. However, the major elements of the budget plan comprise two broad categories: Direct and Indirect Costs
- Direct Costs
Direct costs are perhaps the most critical part of your budget section. These expenses are solely incurred for executing your research. It broadly includes expenses towards:
- Personnel (payroll)
Furthermore, direct costs are sub-categorized into the below two forms based on their occurrence during the research:
- Recurring expenses
- Non-recurring expenses
As human resources are required for the study, salaries with allowances must be budgeted as per funding agency guidelines. The human resources may include personnel such as site manager, research assistant, junior research fellow (JRF), senior research fellow (SRF), research associate, technician, or data entry operator, and attender.
- Recurring expenses:
These expenses are variable and may keep on occurring throughout the study period. Consumables, chemicals, glassware, laboratory test charges , diagnostic kits, stationery, prints, photocopies, communication, postage, telephone charges, survey tools, questionnaires, publication charges, reprints, binding, etc. are some of the particulars in this category. Additionally, recurring expenses could also include allowances for patients/participants, food charges, and medical charges.
- Non-recurring expenses:
These are expenses that are one-time in nature and do not recur at regular intervals throughout the research duration. Equipment or instruments along with its accessories, software programs, computers, printers, electronic accessories of existing instruments in your lab, etc. are some of the particulars covered under non-recurring expenses.
- Traveling expenses:
Travelling expenses can be used for attending meetings, conferences, workshops, and training programs relevant to your research study. Some funding agencies allow both foreign and domestic travel, whereas, some do not. You can mention traveling expenses for collection of data, survey, and visit to other centers in a multi-centric study in this sub-section.
The detailed budget for grant proposal should be clear, well organized and easy to understand. Below is an example for grant proposal. The costs described below are direct costs:
- Indirect Costs
These do not directly attribute to specific expenses of a research, but rather act as an accomplice to run a project. These are also termed as overhead charges. Particulars such as electricity bill, water, library membership, accommodation charges, administrative charges, etc. are included in indirect costs. Generally, about 5–15% of the total budget is provisioned as overhead charges, which is credited to the institution directly. However, this range may vary as per the funding agency.
Tips to Draft a Compelling Budget for Grant Proposal
So when does your budget planning begin? It’s usually when you have your research question and a suitable study design ready!
Here are seven top tips to follow whilst drafting a compelling budget for grant proposal :
- Focus on Uniqueness of Study Essentials
Study design, testing procedures, sample collection methods, and research settings are the essential factors that need to be focused on to resolve the research problem. The uniqueness and complexity of these essentials increases the chances of being incorporated in the budget.
- Follow Funding Agency Guidelines
You must abide by the budget rules and limitations provided by your potential funder and draft the budget accordingly. Scrutinize each instruction and do not deviate from its actual meaning. Most importantly, stick to the list of requisites provided by the funding agencies.
- Categorization of Each Item
Breakup all particulars with their costs under related categories as mentioned earlier. Furthermore, follow an item-wise and year-wise tabulation method to present your budget.
- Value for Money
Funders like to see that the investigators are valuing the finances provided and not splurging on irrelevant particulars. For instance, you must mention if you can redirect resources such as equipment or instruments that are already available from your previous study and can be used in your present study.
- Include Expenses and Revenue
While you are seeking for funds , the funder is interested in investing in projects that bring other resources to the table. Owing to this, your budget section must include two sections:
Inclusion of expenses is obviously the major part of the budget section. Likewise, mentioning revenue in this case means other sources that will pay for your research.
You’d wonder—why do the potential funders care about where the other money is coming from? Well, it is to instill trust in the funders. Acquiring some or most of the needed funds gives credibility to your research and ensures the funder that organizations are willing to invest in non-profit research.
- Do Not Over-Estimate Your Budget
It is critical to base your budgeted expenses on the true costs of your project requisites. But pulling numbers out of thin air will lead to confusion and tally errors. Make sure that you find the cost of all particulars from trusted sources and quote them accurately in your budget. Avoid over-estimating your budget, as it may repel the funder. As you know, “something is better than nothing”! So stick to the narrative of your research and align the budget of grant proposal to it. Subsequently, it is important to keep in mind that a very low budget will raise eyebrows to suspicion. Thus, make sure what you request for is reasonable.
- Tracking Expenses
Describe your methodology to track the expenses throughout the project. You must mention how you plan to effectively manage your expenses and review them. Additionally, give references of some tools that you will be using to manage your finances.
Have you been facing challenges in drafting the budget for grant proposal ? What did you do to improve your budgeting skills? Try these tips while drafting the next budget for your grant proposal and let us know how it works out for you and your colleagues.
Hi , can i please get a template? for research grant
Rate this article Cancel Reply
Your email address will not be published.
Enago Academy's Most Popular
- Diversity and Inclusion
Addressing Socioeconomic Disparities in Academic Funding: Inclusivity in research grant allocation
Research grant allocation is a critical process that determines the distribution of funds to various…
- Thought Leadership
- Trending Now
Knowledge Without Walls: Enago’s comprehensive global survey report on open-access publishing
In the ever-evolving landscape of scholarly communication, the global expansion of open-access (OA) publishing has…
- Publishing Research
- Submitting Manuscripts
Publishers Reimagining Open Access Funding and Publishing: APCs finally being replaced with innovative models
Recent years have seen a dynamic transformation in the academic publishing landscape, driven by the…
- Manuscripts & Grants
- Reporting Research
Are Researchers Alone Responsible for Securing Open Access Publication Funds?
Should we expect research to make a societal impact, when it is not accessible to…
- Career Corner
- PhDs & Postdocs
Opening Doors to Academic Inclusivity: The significance of open access funding
Academia is an ever-evolving space where researchers strive to advance our understanding of the world…
Investing in Visibility: Incorporating publishing funds effectively in grant…
How to Write an Exceptional Research Scholarship Motivation Letter
Learn How to Write a Persuasive Letter of Support for Grant
Sign-up to read more
Subscribe for free to get unrestricted access to all our resources on research writing and academic publishing including:
- 2000+ blog articles
- 50+ Webinars
- 10+ Expert podcasts
- 50+ Infographics
- 10+ Checklists
- Research Guides
We hate spam too. We promise to protect your privacy and never spam you.
I am looking for Editing/ Proofreading services for my manuscript Tentative date of next journal submission:
What support would you need for successful conference participation?
Join us for an exclusive event to learn how to do prospecting, pre-award, and post-award management in one place.
January 5, 2022
How To Craft Grant Budgets for Winning Proposals
November 5, 2021
Table of Contents
If your grant budget doesn’t add up, you’re not getting the grant.
It’s a harsh reality.
You could have the best idea, a perfect plan, assembled the best team, but if you can’t demonstrate that it is feasible, you’ll lose out.
In this comprehensive guide, we'll walk you through:
- The process of creating a winning grant proposal budget
- Why it's so crucial in the grant application process
- Practical insights, useful templates, and real-life examples
This guide will equip you with the knowledge and resources to prepare a grant budget and write a grant that wins funding .
Let’s dive in!
What is a Grant Budget
A grant budget is a financial plan that outlines the estimated income and expenses associated with a specific project or program for which you are seeking funding.
In essence, it's a blueprint for how you intend to use the grant funds to achieve your project's objectives .
Understanding a grant proposal budget is fundamental for successful grant writing. Unlike your operating budget , which outlines your revenue and expenses, your grant budget focuses exclusively on the dollars and cents of your proposed project or program.
It's a mandatory element in almost all grant proposals because it demonstrates the feasibility of your proposed plan.
The Components of a Grant Budget
A complete grant budget will include the following:
- Income: This section should outline all the sources of income for your project, including the grant you're applying for, matching funds, and any in-kind contributions.
- Personnel Costs : Detail the salaries and wages of staff working on the project. Break down their roles and hours to show how their time is allocated.
- Non-Personnel Costs: This category covers expenses like supplies, equipment, travel, and overhead. It's important to provide specifics for each item to demonstrate financial responsibility.
Click to find the best grants for your nonprofit from 12,000+ active opportunities.
Search 150+ subcategories
Why Is a Grant Budget Important?
A well-structured grant budget is not just a formal requirement but a powerful tool that can make or break whether you write a winning grant application .
Your grant grant budget plays a critical role in building trust , ensuring project feasibility , and ensuring accurate reporting .
- Demonstrating Financial Responsibility : A grant budget shows your organization's commitment to wise financial management, assuring funders that their investment will be used efficiently.
- Ensuring Project Feasibility and Sustainability : A well-crafted grant budget helps evaluate your project's financial health, identify potential shortfalls, and demonstrate long-term viability to funders.
- Building Trust With Funders : A transparent and well-prepared budget shows accountability, commitment, and paves the way for future collaborations with funders.
Facilitating Effective Project Monitoring and Reporting : An accurately crafted grant budget serves as a reference for tracking progress, ensuring transparency, and efficient fund utilization in project management.
8 Steps to Prepare a Grant Proposal Budget
Creating a winning grant proposal budget requires careful planning and attention to detail. To help you navigate this crucial aspect of the grant application process , we've outlined eight essential steps that will guide you in crafting a compelling budget.
Related: Project Budgets: What To Do (and What NOT To Do) w/ Margit Brazda Poirier
1. Thoroughly Analyze Grant Guidelines
Before you get started writing your grant budget, make sure to read and understand the grant proposal guidelines . You should be confident that you understand the key requirements within them.
Here are some things to look for as you read through the grant guidelines:
Funders will often list different eligibility requirements. This section will list details such as geographic location or type of organization they intend to fund. Ensure that your nonprofit and project meet the eligibility criteria set by the funder. If you don't meet these requirements, your proposal is unlikely to be considered.
Areas of Funding
Beyond the eligibility criteria, some grants specify what kind of projects or operational expenses the funders are looking to fund. It’s important to pay close attention to this section so that you can ensure your project aligns with these categories.
Pro Tip : You can use Instrumentl to easily identify the area of funding for a grant by looking under the “Fields of Work'' section .
When researching funding opportunities, it’s also important to take note of the listed grant amount. Make sure that this funding amount aligns with your project needs and goals. Then, ensure that your budget falls within these limits.
Related: How to Know How Much to Ask for in a Grant?
Many grant funding announcements will also list what the grant funds can and cannot be used for. Identify these limitations or restrictions imposed by the funder and do not submit a grant proposal that includes any requests for funds outside of the scope of the grant.
Related: The Difference Between Restricted and Unrestricted Funds
2. Conduct a Detailed Cost Analysis for Your Project
Once you've familiarized yourself with the grant guidelines, it's time to conduct a detailed cost analysis for your project . This will involve outlining exactly what your project will cost.
You want to be as exact in this process as possible so that you can execute your project within your proposed budget.
Be sure to consider all expenses related to your project, such as:
- Salaries for staff working on the project
- Materials and supplies
- Equipment costs
- Travel and transportation
- Consultant fees
- Rent and utilities
- Costs associated with monitoring and evaluating the project's progress and impact
- Expenses for creating and distributing project-related materials, reports, or publications
3. Diversify Your Revenue Streams
Many foundations and grant-funding organizations like to see that their funds are not the exclusive source of revenue for your project or nonprofit. While a grant can provide a significant portion of your project funding, it's wise to diversify your revenue streams .
Possible other sources of revenue could be:
- Other grants
- Corporate sponsors
4. Ensure Cohesion Between the Budget and Its Narrative
Your grant budget should align seamlessly with your budget narrative .
Make sure that all grant budget items are described and accounted for within your narrative justification of these expenses .
A common mistake in grant proposals is that these two budget components are often inconsistent. If you outline a budget and then describe or justify expenses that were not listed in the spreadsheet, or fail to articulate items that were, you will end up confusing the funder.
A funder should be able to draw a line between your grant budget and its narrative, aligning the two to get a thorough understanding of the project.
In short, the narrative and the budget should tell a consistent and compelling story of your project's goals, activities, and financial needs.
5. Get A Professional To Review Your Budget
It's a good practice to have an external party review your budget for objectivity. Consider reaching out to peers, colleagues, or others in your network who can provide feedback.
They can offer valuable insights and help identify any areas that may need further explanation or adjustment. External reviews can provide an unbiased perspective on your budget's accuracy and clarity.
6. Factor in Contingencies
Unforeseen circumstances can arise during a project. As such, it's important to factor in contingencies within your budget .
Typically, a contingency allowance of 10% of the total budget is a reasonable starting point. Including contingency funds ensures you have a financial safety net to address unexpected challenges and changes.
7. Highlight Matching Funds or In-kind Contributions
If your project has secured matching funds or in-kind contributions , be sure to highlight these in your budget.
These contributions demonstrate additional support for your project and are often viewed positively by funders . Matching funds and in-kind contributions indicate a broader community of support for your project and increase the perceived value of your grant request.
8. Detail Monitoring and Evaluation Costs
Don’t forget to include a section in your budget for monitoring and evaluation costs .
This helps funders understand how you plan to assess the project's progress and impact, which is a critical aspect of grant reporting. Clearly articulating monitoring and evaluation expenses shows that you're committed to measuring and reporting on the project's outcomes .
What Is the Difference Between Direct and Indirect Costs for Grants?
Grant budgets are typically broken into multiple cost categories. Most of these cost categories will be considered direct costs. A smaller, specific amount of your budget may include indirect costs.
So what is the difference between the two?
Direct costs are the expenses that go directly toward producing the goods or services outlined in your grant proposal. Some examples of direct costs are:
- Salaries (if costs are tied to personnel directly implementing the grant activities)
- Supplies directly connected to grant activities
If you intend to pay salaries with your grant funding, you need to include the associated benefit costs on a separate line item in your detailed budget.
Indirect costs are the general business or operating costs required to maintain your organization. This cost is reported as a single line called “indirect costs” rather than listing out what might be covered by these funds.
Some examples of indirect costs are:
- Salaries (of personnel maintaining operations but not directly implementing grant activities)
- Business services and administration
The Dyson Foundation , for instance, outlines examples of direct and indirect costs. They also note their typical indirect allowable cost percentage at 15%. Watch for that detail in the grant proposal request information provided by the grantmaker.
What Is the Difference Between Modular and Detailed Budgets?
In your exploration of possible grants, you might come across something called a modular budget. Although uncommon, it is worth knowing the difference between a modular and a detailed budget.
The National Institute of Health (NIH) is the only funding entity that requires the use of a modular budget . Why is it still worth mentioning, you may wonder?
The NIH is the largest funder of research in the United States, awarding over 50,000 competitive grants each year.
The modular budget they request in a grant proposal is a budget that is written in modules, or increments. Instead of outlining your specific budget line items, you submit in increments of $25,000 up to $250,000 for a funding year.
If you determine that applying for an NIH grant is aligned with your nonprofit needs, you can use examples of modular budgets to better understand how to build your funding request.
Within every other grant proposal requiring a budget, you will need to complete a detailed budget.
A detailed budget is just what it sounds like, a budget that outlines the detailed costs of your project . In a detailed budget, you will list each of your expected expenditures for the entirety of your project.
Get 9 grant writing guides, exclusive to Instrumentl subscribers. Stress less and raise more—new guides every week, for free.
Grant writing advice, step-by-step guides, and more in our weekly newsletter..
10k+ grant writers have already subscribed
What Should a Grant Budget Look Like? Grant Budget Templates and Examples
A well-structured grant budget is not just about the numbers; it's about presenting your financial plan in a clear, comprehensive, and easy-to-understand format .
Grant budgeting templates and successful examples can serve as invaluable tools to ensure your budget aligns with industry best practices.
If a grantmaker provides their own template, you should definitely use it. However, if the funder does not provide a template, consider the following templates and examples:
When you complete your own grant budget you may want to consider expanding on each of the activities shown in the above example. San Francisco State University also has a grant proposal budget example to see how each of these budget categories can be extended in your grant budget.
You can also find another example of a helpful grant budget template from the Southern Regional Education Board . Their template gives descriptive details of what might be included under each budget category.
Wrapping Things Up: How to Prepare an Effective Grant Proposal Budget
Writing a grant proposal budget is where you will prove to your grantmaker that you have a strong grasp of your intended use of funds.
Spend some time understanding what a grant budget is and what should be included before writing your own.
For more support finding and tracking your grants, create a 14-day free account on Instrumentl to get personalized grant recommendations and start winning more funding today!
Instrumentl is the all-in-one grant management tool for nonprofits and consultants who want to find and win more grants without the stress of juggling grant work through disparate tools and sticky notes.
Become a Stronger Grant Writer in Just 5 Minutes
Grant writers who raise millions stay up-to-date on trends and tips by subscribing to our newsletter.
What separates successful grants from grants that get rejected.
Explore the essential elements that transform your grant proposal from good to outstanding. Learn what sets successful grant applications apart from the rest and maximize your chances of securing funding.
How to Leverage Impactful Letters of Support For Your Grant Applications
Maximize your grant success with impactful letters of support. Discover expert tips and strategies in our comprehensive guide on leveraging letters of support for your grant applications.
How To Optimize Your Team For The Grant Application Timeline Cycle
From research to post-award management, master nonprofit grant application timelines with our comprehensive guide.
The best tool for finding & organizing grants
128 reviews | High Performer status on g2.com
- Conduct , Grants and Funding
How to Plan and Write a Budget for Research Grant Proposal
To be a successful candidate for a research grant, you need perfect budget formulation and justification. Here, we will help you plan the research budget for your grant proposal and give you handy tips to transform it into a convincible form.
Budget as a Skeletal Support
Your budget is the skeleton of your grant proposal. It provides the estimated finance your research needs to be completed in a particular time range. It also gives the funders an exact knowledge about where their funds will be used and how will they be financed ( Asya, 2008 ). It is your responsibility to postulate clearly how you will manage the funds if granted. An excellent budget plan will compel your funders to assume that you have thought about every financial detail concerning your project.
Specific Terminologies to Know Beforehand
Certain wordings are preferred to convey your research budget information better. It is important to familiarize with them before constructing the budget section of the proposals. The lexis includes:
These are the expenses that are utilized solely for executing your research. For example, expenses on your research staff members, tools, materials, and travel finance.
Facilities & Administrative Costs (Indirect Costs)
These are the overhead charges reserved for institutional facilities that you avail yourself while conducting your research. For example, institutional laboratory, electricity, and water usage costs.
These are the additional benefits provided to the personnel, along with their basic salaries. Every institution has its own set of fringe benefits rates.
It is a group of institutions that apply for a grant together as one. They have reached a grant agreement, and one of the institutions represents them all. The budget is divided between them.
Types of Budget
There are two budget designs used in the NIH grant applications. Specific points will decide the type of budget design form you have to use for your application. These are:
Modular Design Budget
Your budget design is considered modular when your research fulfills the following criteria:
- Your direct costs are equal to or less than $250,000 annually
- You are applying for research grants or their equivalents
- Your institution is located in the United States
Detailed Design Budget
Your budget design should be in detailed form if your research project fulfills any of the below-mentioned criteria:
- Your direct costs are more than $250,000 per annum
- You are applying for grants other than research grant type or its equivalents
- Your institution is situated outside the United States
For the modular design, you have to fill out the PHS 398 modular budget application form, and for the detailed design budget, you have to use the R & R detailed budget application form.
Planning your Budget
Your budget planning starts when you find the research question and decide on a suitable study design. You should also be able to guess the unpredictable charges that can arise while conducting your research ( Sudheesh, Devika & Nethra, 2016 ). There are five main points to keep in mind while planning your research budget:
Pin-point the Budget Essentials
Think about all the things that will affect your research budget. These are mainly the study design, testing procedures, sample collection methods, and research settings. The more complicated and unique these essentials will be, the higher will be your budget requirements. Also, observe the already present resources and will they benefit your research budget.
Follow the Instructions of the Funding Agency
The next point to consider while planning your budget is to abide by the budget rules and limitations of your particular funding agency. Read each instruction carefully and remember not to deviate from it. It is expected of you to provide the exact list of items necessary for your project.
Categorization of Each Item
Thirdly, a breakdown of each item into its related category should be made along with its cost. A breakdown of the budget item-wise and year-wise with cost calculation should be done. Point out the recurring and nonrecurring items that are directly related to your research. All this planning is done beforehand to ensure proper budget management.
Justification of Each Item
For every enlisted item, you should be able to provide a solid justification for its importance in your research. Only a well-justified budget document can win the confidence of the peer reviewers.
Review & Verification of the Budget Items
Reviewing is the most significant step for every document or proposal. You can ask your team members to review your budget document for you. Also, recalculate the cost of each item and the total items combined cost per annum. Keep in mind that too low or high budget will only raise suspicion in the mind of your reviewers. So, make sure you plan a research budget range, not more than the maximum limit set by your funding agency ( Michael et al., 2019 ).
Scripting your Budget onto the Grant Application
Projecting your finances into your application requires skills. When writing, we primarily divide our budget into two sub-sections. These include:
As mentioned before, these are the direct expenses on which your research is largely dependent. So, firstly, give the heading of direct costs and then further give the following subheadings with explanations.
If your research project involves resource team members, here is where you have to mention them. Your resource team includes the technicians, laboratory attendants, site caretakers, data entry personnel, junior researchers, and the senior researcher involved. Specify their allowances and salaries in an organized manner.
These expenses occur regularly and yet cannot be avoided. These include equipment usage, laboratory-conducted diagnostic tests, telecommunication charges, chemicals, and any other essential items. Fees for human subjects involved in your research are also stated here.
These are the costs of items for which you have to pay one-time charges, and then their use is free. These include buying charges for the printer, computer, or other electronic items. Once you buy them, they are charge-free. Thus, you have to specify all the non-recurring charges in your budget form.
In this subheading, specify the amount spent on your traveling for research purposes. Separately mention your traveling costs for attending research-related conferences, seminars, and training. Also, mention the travel expenses for the surveys and data collection. Visiting expenses to other institutions for the sake of a research study can also be mentioned here.
The second sub-section is indirect expenditure. It includes facilities that are indirectly related to your research project. These can be library facilities, electricity, and water usage for your experiments and test conduction. These are also called overhead charges that are paid specifically to the institution for providing such facilities ( Ahmed & Abdullah, 2017 ).
In the final paragraph, write a short finalizing note relating your budget outlining the main point. This should be a 4 to 5-lined paragraph.
Most of the funding agencies separately require justification for each item that you specified in your above-mentioned budget form. This document is also known as the budget narrative page. It reasons the importance of that item for your research conduction. Each item is mentioned in the same order as in your budget form and should be justified respectively ( Al-Jundi & Salah, 2016 ). It is best to make a three-columned table with the name of the item in the first column, the quantity and cost in the second column, and a justification statement in the third column.
In the last, you have to provide a summarized form of your budget for your proposed research. It is written at the end when you have completed writing your whole application. In this, you have to specify every item with its cost per annum. The non-recurring items will only be specified under the first-year heading as they have a one-time expense. Likewise, the recurring items will be mentioned in both years, along with their costs.
The following points will enhance the esthetics of your budget section:
Headings & Bullet points
Writing the budget items under a categorized heading will make it easy for the reviewers to retrieve the necessary points in your budget. You can use bullet marks or checklist signs to highlight your main points. This will show the reviewers that you have the budget representation skills and that your enlisted budget finance is authentic.
Try to write your budget essentials in a tabulated form with three main columns. The first column represents the item name. The second column specifies the cost of that particular essential. The third column signifies the importance of your particular essential in performing your research. This will save both time and effort of reviewers who have to scrutinize many applications at a time.
The pattern you follow for each essential specification in the budget form should be followed in the same manner while writing the budget justification document. There should be a flow in your budget data and which will further enhance its esthetics.
Your language should be simple enough to be understood by a common person. Complicated terms and phrases will only make it difficult for reviewers to reach your point of view.
Your budget prepares you for all the financial aids you need to conduct your research. It informs you about the expenses of each research item and method. In this way, you can choose an economical procedure for your research. The budget section is considered as the key factor of success or failure for your proposal. This section requires a skillful approach and should be handled delicately. Nowadays, research writers record their budget in the form of electronic spreadsheets. It is easy to manage the budget essentials and the expenses via these excel spreadsheets. You just need to point out and categorize the direct and indirect costs in the already drawn tabulated budget spreadsheet. Hence, you will be able to plan and compose a well-scripted budget by following the instructions given in this article.
- Al-Riyami, A. (2008, April). How to Prepare a Research Proposal. Oman Medical Journal , 23 (2), 66–69. http://europepmc.org/articles/PMC3282423
- Duggappa, D.R., Nethra, S.S. & Sudheesh, K. (2016, September). How to Write a Research Proposal? Indian Journal of Anaesthesia , 60 (9), 631–634. https://doi.org/10.4103/0019-5049.190617
- Burkhardt, J., Carlson, J.N., Gottlieb, M., King, A.M., Lee, S., Santen, S.A. & Wong, A.H. (2019, January). Show Me the Money: Successfully Obtaining Grant Funding in Medical Education. The Western Journal of Emergency Medicine , 20 (1), 71–77. https://doi.org/10.5811/westjem.2018.10.41269
- Al-Maniri, A. & Al-Shukaili, A. (2017). Writing a Research Proposal to the Research Council of Oman. Oman Medical Journal , 32 (3), 180–188. https://doi.org/10.5001/omj.2017.35
- Azzam, A. & Sakka, S. (2016, November). Protocol Writing in Clinical Research. Journal of Clinical & Diagnostic Research, 10(11), Z10–Z13. https://doi.org/10.7860/JCDR/2016/21426.8865
Best Microchannel Pipettes: A Comprehensive Guide
Introduction Pipetting, at first glance, would seem a fairly simple and easy task. Essentially described as glass or plastic tubes used to measure and transfer liquid
Resource Identification Initiative
Resource Identification Initiative: A Key to Scientific Success and Analytics The key to success can be found in the essential principles of the Resource Identification Initiative.
Best Microcentrifuges: A Comprehensive Guide
INTRODUCTION AND BRIEF HISTORY One of the most important pieces of equipment in the laboratory is the centrifuge, which facilitates the separation of samples of different
Best Benchtop Centrifuges: A Comprehensive Guide
Username or email *
Remember me Login
Lost your password?
Create an account?
Cart totals cam.
— or —
- 0 Request a Quote
Enter the destination URL
Or link to existing content
Want a 10,000-foot view of ClickTime's capabilities? View our Product Feature Tour.
Learn how companies like yours use ClickTime every day to improve their workforce's efficiency.
[eBook] How to Track Time. Get actionable tips for success at every stage of your time tracking journey.
How to Write a Grant Budget to Win Your Dream Grant
Table of contents.
Applying for grants can be a frustrating, time-consuming process. Different foundations have different requirements. Funders’ priorities vary based on their foundations’ missions. And the more money you’re asking for — especially if that money comes from the state or federal government — the more you’re asking for scrutiny into your nonprofit’s activities.
And some of the highest levels of scrutiny are applied to your grant budget proposal.
Many organizations take planning seriously when it comes to projects and budgets. After all, you need to know what work you’re taking on, how much it costs, and what your profit margins are.
1. Implement Systems of Internal Control to Prove Financial Transparency 2. Understand Your Funder’s Requirements 3. Work with Your Team to Estimate Realistic Costs 4. Show The Funder Exactly What Their Grant Will Cover 5. Compare Your Budget to Your Grant Narrative 6. Check Your Work
Since you’re likely asking for a significant amount of funding, it makes sense that the committee reviewing your application wants to see a detailed, accurate budget to understand where their money will go.
But how do you come up with the numbers you need to accurately represent your program activity? Where do you find historical data to support your projections? And how can you inspire enough confidence in funders to encourage them to write a check?
Keep reading for information on how to write a grant budget that’s detailed, evidence-driven, and representative of your nonprofit’s mission.
The Purpose of a Grant Budget
Grant budgets are only one small part of a grant proposal . However, when it comes to applying for competitive grant funding, the budget is arguably one of the most important parts . With many organizations competing for funding, a grant budget proposal is one of the more objective components of your application. It includes hard numbers that funders can verify if necessary, and it will be an important document to refer back to if you receive funding.
Overall, the purpose of a grant budget proposal is to:
- Serve as proof that your organization has considered the true costs of running your project or program.
- Show funders exactly how much a project or program costs — and, therefore, how much you actually need funding relative to other organizations.
- Demonstrate how your nonprofit will put competitive funds to good use compared to other nonprofits applying for funding.
So not only is creating a grant budget an exercise in financial responsibility for your organization, it’s also necessary to help funders see your organization as worthy of the funding — especially in comparison to other organizations who could also put the funds to good use.
How to Write a Grant Budget in 6 Steps
Since your grant budget proposal is one of the most heavily weighted parts of your grant application, it’s important to get it right. Keep reading for an overview of what goes into writing a grant proposal budget.
1 Implement Systems of Internal Control to Prove Financial Transparency
When you’re applying for federal grants , there’s a serious need for transparency around your nonprofit’s bookkeeping methods. The federal government is handing over significant sums of taxpayer dollars, so they expect to know that every single cent will be spent wisely.
To ensure maximum accountability, federal grants suggest that all nonprofits implement systems of internal control to track all grant-related expenditures. These systems help you track and account for every cent received from a grant and how it’s spent. They range from creating strict processes surrounding accounting procedures to using software to automate tracking.
Common examples of systems of internal controls
- Using timesheet software to allocate salaries to various functions and audit-ready timestamps for timesheet entries.
- Creating a process for writing checks and sending payments.
- Using accounting software (rather than spreadsheets) to automate, organize, and timestamp general ledger entries.
Having the controls in place prior to submitting the application demonstrates that your organization is committed to and prepared for taking on new funding sources. It might even differentiate you from other applicants that don’t have systems in place for reporting.
2 Understand Your Funder’s Requirements
The first step in creating a grant budget is understanding what your funder’s requirements are. Your overall grant application should align with the funder’s interests, scope, or mission. However, your grant budget often requires adhering to funders’ specific requests or preferences.
Below are a few of the most important requirements to consider when creating a grant budget proposal.
First, you need to know how much you can or should request from a funder. Sometimes grantmakers outline funding amounts very concretely, providing a range or a cap on the money an organization can expect to receive.
If a funder hasn’t provided a range or cap, deciding on a reasonable request might require some digging. In that case, you have a couple options:
- Call the funding source for more information and guidelines.
- Track down how much the grantmakers awarded to grantees last year using their IRS Form 990 information.
- Use a tool like Foundation Directory Online or look at public records to find a typical grant amount.
If you decide to move forward with your application after understanding how much you can expect to receive, it’s time to format your budget correctly.
Many funders provide templates for grant budgets. If that’s the case, make sure your budget ends up in the correct format — even if you do your own calculations in a separate spreadsheet. If no template is provided, you can always use a free grant budget template online to help you understand what to include or follow examples of grant budgets created by other organizations.
At the end of the day, you should present your budget in a format that’s easy to understand. Include and emphasize important information, like cost categories, so funders know what you’re asking for and how it aligns with your overall mission.
Following the correct format also means knowing how much information to include. Some funders only need to know a program budget, but others might require your organization’s overall budget.
Your budget type will also depend on the timeframe of the grant. An annual budget is important for a year-long grant, for example. However, a multi-year grant will require projections farther into the future.
Expense Types, Matching Funds, and Revenue
Finally, you’ll need to understand the different types of expenses and numbers required and covered by a grant. There are several types of expenses you’ll need to consider when creating your budget proposal.
Direct expenses are the funds you’ll need to run your program or project. They include costs such as:
- Personnel or salary for staff hours spent on program activities
- Fringe benefits, such as time off or insurance for the personnel working on your program
- Supplies or materials
You can think of direct expenses almost as noun expenses: they’re the people, places, and things you need to run your program. They’re the main component of your grant budget since receiving funding for these types of expenses directly relates to achieving your mission.
Indirect expenses are the overhead costs it takes to run your organization. Paying an electricity bill to keep the lights on in your office is a good example of an indirect expense. While you can’t necessarily attribute the cost of electricity to a specific project or program, you could argue that paying your electricity bill is necessary for your staff to complete their work.
Many grants will allow you to allot or negotiate a certain percentage of funding to indirect costs that you incur while running your organization.
Matching Funds and Revenue
Many grants will require you to show matching funds. However, even if they aren’t required, they’re still a good line item to include in your grant budget. They show that other organizations and community members support your project and think it’s worth funding.
You can also outline other sources of revenue, such as general donations, to show that your program can garner other sources of funding.
3 Work with Your Team to Estimate Realistic Costs
Once you understand what information you need, it’s time to start gathering data so you can come up with real numbers for your budget. And since grant budgets require quite a few line items, you’ll want to call on your team members to help you track down and verify realistic costs.
Realistic costs supported by real data are important for both your nonprofit and your funders. Inflated costs will make your organization appear wasteful, signaling that you aren’t efficient in your operations. And underestimating costs will cause savvy grantmakers to doubt your estimates, or will result in a reduced budget. Underfunding will force your nonprofit to use unrestricted funds to finish a program once grant funding runs out.
Program managers are great resources to start making lists of all the things you’ll need — staff, supplies, services, space — to actually run a program. Accounting can help you estimate associated overhead costs. And some internet sleuthing can help you nail down the costs of supplies or services if you haven’t purchased them before.
Wherever you can, use historical reports and pin down real data to show you’re not pulling numbers out of thin air or making wild guesses about costs.
lightbulb A Quick Tip
Many state and federal grants have stringent rules related to time tracking. By using time tracking software before, during, and after the grant application process, you can:
- Have access to historical data for creating grant budgets by segmenting employee activities into their appropriate functional expense categories.
- Speak authentically to your organization’s overall efficiency and how it positively impacts your mission’s outcome.
- Create a detailed audit trail.
- Inspire confidence from funders by meeting time tracking requirements before they ask you to.
Time tracking software provides historical data to back up your projections. Using the data will help you confidently justify your numbers to funders if there are any questions. And when your realistic numbers are understood and approved, your nonprofit can avoid getting stuck covering unexpected expenses.
4 Show The Funder Exactly What Their Grant Will Cover
After you’ve calculated your costs — and your team agrees that those numbers are both accurate and realistic — it’s a good idea to show funders exactly where their money will go.
For example, if your program will cost $20,000 and you’re requesting $10,000 from a foundation, you can show funders how you’ll allocate their money and where you’ll use matching funds.
Including this level of detail helps demonstrate your knowledge of the funder’s requirements. If a specific grant doesn’t cover overhead costs, for example, you can show how you’ll pay for those without touching a funder’s money. It’s also a good way to show how you’re putting matching funds or other revenue to work to cover the full cost of a program if a grant won’t provide for everything.
Instant Grant & Fund Reporting. Powerful Program Insights.
Learn how you can keep your funding and goals on track with time tracking software built for nonprofits.
Learn About ClickTime for Nonprofits
5 Compare Your Budget to Your Grant Narrative
A grant narrative is the story of what your nonprofit would do with grant money if you received it, and it needs to align with the logistics of your budget.
A grant narrative needs to encompass the basics of a grant. For example, if you’re applying for a grant to run a year-long program, your budget should include the costs for the entire year.
However, your narrative also needs to line up with your stated mission in receiving the grant. If you’re applying for a grant that will help you operate a free bike ferry to make biking more accessible for local residents (like Vermont-based Local Motion ), your budget’s line items should include costs related to that program.
Even the narrative of your grant needs to include concrete, realistic numbers to measure impact. Federal grants, especially, need to understand exactly how you’ll use your funds to create change. Using our more accessible biking example above, you could say that you’ll use grant funds to improve access to all local bike paths in a defined 10-mile radius of all ferry stops, resulting in 5% more use of those bike trails over the next year.
In this case a grant application budget should include line items for ferry operation. But it will also need to include items for measuring outcomes. Surveys, check-in points on trails, a volunteer standing by making tally marks — calculating and considering the costs of these impact measurements will all have to show up in your budget so they can be covered by funding.
In short, after you’ve added up all your numbers, you need to make sure they tell the appropriate story and help you demonstrate that you’ll be able to report on your progress along the way. If it’s not clear how a specific line item connects to your grant narrative, you can always include footnotes to add clarifying details to your story.
6 Check Your Work
A simple mistake could mean the difference between receiving funding and being denied. No matter how confident you are in your numbers, make sure to double-check your calculations and ensure your budget is error-free.
Get Your Systems of Internal Control Under Control
While accounting tools such as QuickBooks or payroll software are often no-brainers for nonprofits who need to keep track of every penny, many organizations don’t think about timesheet software until grant reporting requires it. But having the tools and processes in place to track time according to grant requirements gives funders confidence that your organization is already operationally ready to take on grant funding.
Time tracking tools can bolster the credibility of grant applicants by showing a well-thought out commitment to execution, tracking, and transparency.
ClickTime is a timesheet system that makes time tracking easy, so you can ensure that your employees’ timesheets are both accurate and complete. Features like Time Entry Completion Reports and Reminder Notifications also make timesheets easy to review and approve, even for busy program managers. And using custom fields to match tasks to functional expenses will help your nonprofit keep an eye on overhead costs.
With a detailed report of how time is spent across your organization, you can identify inefficiencies so everyone can spend more time servicing your nonprofit’s mission. And those details can help you write more authentic budget proposals that showcase your low “management and general” expenses so grantmakers can rest assured that their money will be spent to meet your program goals.
Request a demo of ClickTime to see how our timesheet software can help your nonprofit win competitive grants with confidence.
You May Also Be Interested in
Billable Hours vs. Non-Billable Hours: How to Get Paid fo...
Against All Odds: How Accurate Data Helps PR Firms Nail T...
Adjusting for Inflation: How to Increase Your Service Pri...
STAY UP TO DATE
ClickTime Recognized as a SourceForge Partner
Quarterly Product Newsletter Q3, 2023
Leveraging Nonprofit Data to Organize Your Operations