Once a new project or business idea is given the green signal, it’s time to build a budget. Developed during the planning phase, a budget is like the financial blueprint for your project, where you can estimate, implement, and gauge projected versus actual project costs.
For project managers & stakeholders, it is a critical tool for tracking how much money or resources are being spent, for what, and by when. A typical budget covers any & all costs likely to be incurred during a project’s lifecycle: e.g, the cost of hiring labor, subcontractors, and vendors; procuring materials such as office equipment, raw materials, and machinery; buying software licenses and regulatory permits, as well as paying for utilities, office space, and administrative overheads.
Our Project Budget Excel template is simple but incredibly useful as it not only allows you to enter and analyze three different types of costs in the same spreadsheet (Labour, Material, and Fixed) – it also calculates the total variance in your project finances – that is, the difference between what you expected to spend (Estimated Costs) and what you end up spending (Actual Costs), helping your project stay in its financial limits.
Now, let’s explore our template in more detail:
Project Overview
Right at the top of our template, we identify and describe the project as a whole, including its name, version (in the case of periodically extended projects), and brief background.
We also identify the project lead (usually, the Project Manager) who oversees the overall planning, procurement, and execution of a project, and has the ultimate responsibility of making sure the project sticks to its estimated budget.
Labor Costs
From researchers, web developers, and managers to fieldworkers and administrative staff – each project needs human resources to successfully come through.
In this column, you list down the labor costs for each task. To standardize this cost, we use an hourly rate as this offers greater flexibility to cover the labor of any consultants or freelancers you intend to hire for a limited time and not the entire project duration as in the case of regular project staff on your monthly payroll.
Once you add a fixed hourly rate and the total number of working hours, both of which are usually agreed upon in an employment contract, we calculate your subtotal for Labour Costs for each task which are then summed together to create a final Total for Labour Costs shown at the top.
Material Costs
Material costs include a wide range of expenses associated with procuring any physical materials needed to execute a project. From office supplies and fuel costs to manufacturing components and hardware equipment – these materials vary by industry and field.
For instance, in the construction industry, you need to budget for materials such as concrete, clay, and lumber needed to build structures. In an academic project, you will need to procure laptops, wifi devices, and hard drives to facilitate research.
In these columns, you will identify the number of units of a specific material resource you need to complete a given task. For example, if you are a clothing brand, you need to specify how many meters of fabric you need for your new line. You then need to enter the cost per unit based either on market rates, wholesale prices, or vendor quotes, as the case may be.
Once you have added this information, we calculate a subtotal for your Material Costs for each task which are then summed together to create a final Total for Material Costs shown at the top.
Fixed Costs
Fixed costs are any expenses not directly tied to labor or materials but that still indirectly contribute to a project’s success. Here are some examples:
- Traveling costs for staff members who need to travel out of station
- Equipment such as laptops or phones
- Administrative overheads related to office management, and general administration
- Utilities such as electricity, water, and heating are needed to operate the workspace
- Licenses and permits or certifications necessary for project compliance and operations
For each task in our spreadsheet, we use two specific sub-categories of fixed costs: travel-related costs, and equipment-related costs. However, we have also added a third general category that allows you to cover any other type of fixed cost in your budget plan.
Budget Vs. Actual Costs
In these two columns, we specify the anticipated costs of completing each task, as estimated in your project proposal. This is followed by the actual amount of money you end up spending on the labor, material, and fixed costs associated with each task. Based on these two values, we calculate the variance in your budget. A value in the minus indicates that you are spending less than what you initially expected to spend.
Right at the top of our spreadsheet, we also added a doughnut chart, which gives you a quick and easy-to-understand visual representation of your total expected and actual budget for the whole project, as well as the variance between them.
Note that any changes or updates in the mainsheet will be automatically reflected in the chart, helping you track whether the project is staying within its financial limits, and alerting you when tasks run over budget so that you can adjust costs or other expenditures.
Who Is Our Template For?
- Project Managers
- Finance Teams/Accountants
- Business Owners/Executives
- Team Leaders
- Clients/Sponsors/Investors
For a complete financial layout of your project, feel free to use our Project Budget in tandem with our Resource Plan template!
Why do You Need Our Project Budget Template?
- Provides a detailed breakdown of all costs associated with the project.
- Ensures the project remains financially viable and on budget.
- Helps allocate resources efficiently by tracking expenses against planned costs.
- Aids in forecasting future expenditures and cash flow requirements.
- Allows for effective cost control by identifying overspending or areas where adjustments are needed.
- Provides stakeholders with transparency about how funds are being used, ensuring accountability.
Wrap Up
Whether you are starting your own business, or designing an upcoming campaign to market your goods or services – a formal budget allows you to accurately forecast your project costs. The more accurate your budget forecasts, the more likely you are to deliver a successful project and make a profit.
Use our Project Budget template to track your project budget at the task level and identify your budget projections.
Our editable Project Budget template is designed in Excel and Google Sheets and can be instantly accessed in .xlsx, .xltx, and .ods formats.
