On No!…The B-Word: Why Budgeting Is NOT A Four-Letter Word


The end of the year is near.  You’ve done your employee reviews, you’ve reviewed your A/R and A/P, now it’s time to focus on building out your budget for next year.  

The first step to creating a successful budget for 2024 is to look back at prior financials…you can’t know where you are going if you don’t know where you’ve been.


🔎 Review your Profit & Loss statement over prior years and note any significant changes year over year. If you had a budget for 2023, how did you do with actuals vs budget?  If there was a material variance, identify the root cause.  Either adjust your future budget, or adjust your spend.

🔎 Review a list of disbursements by vendor.  Carve out time to review each vendor–has the price increased or decreased?  Do you know what the vendor provides to your agency?  Is there an opportunity to reach out and negotiate a better rate?

🔎 Review carrier product reports and profit sharing agreements.  Does your management system match their reports?  Are you in a position to receive profit sharing revenue?

Once you have looked back, then you look forward.

  • Understand your goals.  Do you want to hire a new account manager or producer?  Do you need IT upgrades?  Do you want to provide more robust benefits to your employees?  Do you want to pay down corporate debt? 
  • Develop a plan for how you are going to reach your goals.  The best strategy is to both increase revenue and decrease expenses.  How will you do both?
  • Plan for taxes.  Factor in taxes when creating your budget. Understand your tax obligations and set aside funds to meet these expenses.
  • Seek professional advice.  If you’re unsure about certain aspects of your budgeting or financial planning, consider consulting with financial experts or hiring a professional accountant to provide guidance.  

You have taken a look at the past, and have goals for the future…now what?

  • Input your budget into your accounting software, or create your budget in a spreadsheet.  Schedule time now for all twelve months of 2024 to devote time to reviewing actual vs budget.
  • Invest in training your agency leadership.  One of my favorite quotes is “a change imposed is a change opposed.”  Include your key staff (managers and influencers) in discussions about their department budgets.  Instead of telling an employee or department manager “no” when they ask for increased spending, chat with them about department goals and milestones, and let them help you create a plan.  

Your budget is done, you have committed to regular budget reviews, and you have your team’s buy-in.  Pat yourself on the back!  You have accomplished something big, and you will see the fruits of your labor over the next year. Just remember that flexibility is key, and a successful budget evolves with the changing needs and circumstances of your business!

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.

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