(This article is courtesy of The Pemberly Group, and first appeared HERE)
As the year winds down, it’s the perfect time to start planning your budget for 2025. If you’re using QuickBooks Online Plus or a higher subscription tier, you can take advantage of the built-in Budget feature to streamline the process. However, if you’re on QBO Essentials or using a CRM/AMS without a budgeting feature, don’t worry—Excel can be your best friend.
Here’s how to create a budget for next year in just a few steps:
Step 1: Export Your 2024 Profit and Loss Report
- Run your Profit and Loss (P&L) report in QuickBooks Online for January through December 2024, sorted by month.
- Export the report to Excel, giving you a clear breakdown of your income and expenses over the year.
Step 2: Prepare Your Spreadsheet
- Open the exported file and add columns to the right of each month for your 2025 budget numbers.
- Label these columns to keep them organized, such as “Projected Revenue” or “Budgeted Expenses.”
Step 3: Set Growth Targets
- Decide on your revenue growth goal for 2025. For example, if you aim for a 10% increase, multiply your monthly revenue figures by 1.10.
- Apply this same growth formula to any variable expenses that are likely to scale with revenue, such as marketing or production costs.
Step 4: Analyze Your Fixed and Variable Expenses
- Review your expense categories thoroughly. Are there fixed expenses, such as rent, that will remain stable? Or are there areas where you anticipate higher costs, like hiring additional staff or upgrading technology?
- Adjust your budgeted expenses to reflect these anticipated changes.
Step 5: Finalize and Use Your Budget
- Once you’ve input your projections, review the entire budget for accuracy and alignment with your goals.
- Use this Excel file as a guide to compare actual performance against your targets throughout the year.
By following these steps, you’ll have a clear financial roadmap for 2025, even without built-in budgeting tools. Remember, the key to successful budgeting is regular review and adjustment as circumstances evolve. Happy planning!
About Crystal Temple
Crystal has spent nearly two decades focused exclusively on accounting and bookkeeping for insurance brokers. She has founded multiple bookkeeping groups, one of which was acquired by a prominent AMS provider. Crystal has also served as a controller of an agency group that acquired over 50 agencies in a two-year timeframe. She is the co-founder of a startup called Ricono, building a platform to address some of the technology deficiencies brokers face when trying to measure and manage their financial operations.
Crystal has spent nearly two decades focused exclusively on accounting and bookkeeping for insurance brokers. She has founded multiple bookkeeping groups, one of which was acquired by a prominent AMS provider. Crystal has also served as a controller of an agency group that acquired over 50 agencies in a two-year timeframe.
She is the co-founder of a startup called Ricono, building a platform to address some of the technology deficiencies brokers face when trying to measure and manage their financial operations.
