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Question 2.

Each great financial plan begins by creating an accurate and sound budget. It is the initial step toward making financial goals a reality. Setting up a budget requires one to determine income one makes after-tax monthly. If there is variation in compensation, using average will is acceptable; however, more accuracy is preferable. All other sources of income should be including dividends, interest, rental income (Petch, 2019). Second calculating expenses by breaking up the monthly into specific buckets such as food, utilities, and transportation. Then follows calculating the difference, if the expenses are higher than the savings, one should either spend less or make more money. However, it is much easier to cut spending as opposed to making more money. Determining how to spend the savings is the fourth step, one can decide either to pay off interest debt if any or consolidating the debt at a lower rate to pay it off faster and save more (Levenson Keohane, 2013). Lastly, one should make it a habit by aiming to stick on their budget and review it every two weeks. Such a habit helps individuals comprehend how to track their spending, which must be changed and sticking to financial goals.

When nonprofit funding and budgeting for the resources are not matched well, funds don't flow to areas that are likely to be of great importance. This results in promising programs that are curtailed cut or never launched. Budgeting is fundamental financial management in running a nonprofit organization. One side budget involves sources for a firm. This entails fundraising, income for corporate philanthropy, and grants. The revenue usually defines the needed funding a nonprofit has to spend on different strategy programs based on the amount of the money it brings (Fortuserclient, 2017). Generally, writing of budget should be based on the funds that the firm had previously from funding campaigns. The recent fundraising usually offers a good demonstration as to what future fundraising is likely to appear. Therefore, every business requires a detailed funding plan and budget to ensure effective control of financial resources to ensure the effective running of nonprofit programs. Continuous budgeting throughout the year helps identify any issue that affects funding and allows enough time to decide how to fix them.

Reference

Levenson Keohane, G. (2013). Social entrepreneurship for the 21st century: innovation across the nonprofit, private, and public sectors. P.O. Box 182605, Columbus, OH: McGraw-Hill Education. ISBN: 978-0-07-180168-3

Fortuserclient, S. (2017, August 21). Budgets Checkup: critical components for nonprofits: Retrieved from https://sygnvs.com/budget-checkup-critical-components-nonprofits/

Petch, K. (2019, July 11). Factors That Will Determine What Budget Looks Like. Retrieved from: https://maplemoney.com/your-budget-5-factors-that-will-determine-what-it-looks-like/