Grant Writing Tip - Creating the Proposal Budget

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A budget cannot be prepared until the agency's policies, priorities, and plans have been clarified. The budget is derived from the objectives, tasks, and activities expressed in your proposal/program.**


  • presents the proposal/program in a financial sense;
  • reflects the plan and how resources will be allocated to implement the plan;
  • is straightforward and the numbers are complete; where appropriate, calculations can be duplicated (by the reader);
  • tells how the money will be used to do the job described in the proposal/program;
  • indicate such things as who will be doing the job, anticipated travel expenses, and what supplies and equipment will be needed;
  • also indicates the organization's commitment to the grant request from the standpoint of both cash and in-kind services.

Goals and Objectives, as a part of Creating a Budget

Without clearly stated goals and measurable objectives, the agency cannot make worthwhile projections of the future. Moreover, the agency cannot expect budgeting to substitute for planning. Policies, priorities, and plans - both long-range and short range - must be in place before budget preparation can commence.

A detailed budget should be consistent with proposal/program guidelines. Costs should be in reasonable proportion to the outcomes that you anticipate. If your costs will be prohibitive, scale back your plans or adjust them to remove the lease cost-effective expenditures.

**a budget for a proposal may differ than the budget for a specific program.

Developing Your Proposal Budget

Points To Remember:

  • If there is a specified fund limit, DON'T EXCEED IT.
  • Describe the need for budget totals/items in a narrative to assist reviewer to determine the reasonableness of proposed budget.
  • Budget should be realistic and not extravagant. Leave some room to negotiate.
  • Identify your agency's contribution for match/in-kind and identify other local funds available for project.
  • For multi-year grants, decrease the amount of government support and build up local support.

All Budget Items Should be Related to Project Objectives

You may want to start your proposal writing by first preparing your "shadow" budget. This procedure may help to clarify exactly what you want to accomplish and can accomplish with the specified funds.

Consultants should be requested sparingly, and only when absolutely needed. When they are required, the need should be explicitly stated. If a particular consultant is needed, the applicant should explain exactly why, and a letter of agreement from the consultant should be included in the appendix.

REMEMBER: The amount of funding that you are requesting should be commensurate with the level of effort necessary to accomplish the goals and objectives of the project. The amount of your request should be reasonable in relation to the anticipated results.

Grantwriting Proposal Budget Tutorial

This online course is designed to help with the basics of developing a project budget, and it is geared for those who have general knowledge of proposal development. (Beginners might want to take the Proposal Writing Short Course.) When you complete this course, you will know:

  • The basic components of a project budget
  • Different types of financial documents often required for proposals
  • How overhead costs and fringe benefits may be incorporated within the budget
  • How to access resources on the Web, which provide templates of project budgets