Budgeting for fundraising should include estimating both contributed revenue and fundraising costs in order to arrive at projected net contributed revenue.  Follow the steps below to build a successful fundraising budget for your organization.

Quantify fundraising performance data from the past three years, eliminating outliers (one-of-a-kind transactions not likely to be repeated):

• Net Contributed Revenue = Total Contributions less Total fundraising expense
• Retained Gift Dollars = Dollar value of contributions from last year’s donors
• Reactivated Gift Dollars = Dollar value of contributions from prior donors who did not give last year
• New Gift Dollars = Dollar value of contributions from first time donors

Analyze qualitative information:

• From which sources, e.g. individual donors, foundations, corporations, is there potential for realistic growth in the year ahead? New donors?  Increased giving from past donors?
• What is the basis for arriving at the estimated potential?
• What is the estimated dollar value of that growth potential?
• What additional fundraising costs will be incurred in order to realize that potential?

Synthesize past performance with potential:

• Projected fundraising costs to arrive at
• Projected net contributed revenue.
• Include a budget narrative documenting the data and the reasons behind your projections.

Integrate with the larger organization:

• Synchronize fundraising budget and goals with the organization’s annual budget
• Secure Board approval