Short term budget plans are more ideal for personal budgeting as well as startup businesses or small-time businesses. The following are the benefits of building monthly budget plans:
• Be able to manage cash effectively
• Be able to allocate resources wisely and profit oriented
• Bet able to clear financial objectives faster
• Be able to monitor the business’ performance easier
• Be able to come up with intelligent decisions for improvement
• Be able to prepare for future expenses and other circumstances that need financing
By doing a monthly budget, there’s little risk involved since you won’t have to consider the time value of money due to the plan being only for a shorter term as well as the estimate is closer to realistic results. When building a monthly budget Excel spreadsheet template that you can use whenever you need to, here are some tips that we think are helpful for you.
1. Start building your budget spreadsheet template in Excel. Excel is a great tool due to its flexibility and built-in functions that are useful for financial modeling. It is also one of the most common tools that financial modelers use to build their own templates as well as financial models.
2. Make your template simple but effective. Basically, you want your template to be easy to use by any kind of users as well as easy to understand by any kind of readers. But of course, you must also ensure that the template is effective and reached its purpose which is to represent a budget plan.
3. Focus on the Profit and Loss statement or P&L to build your budget spreadsheet template. This is because to prepare a budget, your aim is to monitor the expected income and expenses (annually or shorter) or basically, your operational plans so that you can monitor your business’ outcomes against the prepared budget.
4. Provide transparency on all assumptions. Therefore, you need to identify and document all assumptions made for the budget period to explain the projected results.
5. Build it in a way which allows comparing actual vs. budget figures. This is so that once you update your budget plan, you will be able to track and check if you meet the goals you were aiming for when you first prepared the budget.
If you’re planning to create a budget plan and don’t know how to build one, you can download and use monthly budget Excel spreadsheet template instead. By simply downloading a monthly budget Excel spreadsheet template, you will no longer have to build a budget plan from scratch and save yourself the trouble from having to use all that time learning how to build one.
You can also acquire industry-specific financial model templates at eFinancialModels which consists of financial modeling experts with a wide range of experience and know-how. So, take advantage of the ready-made templates by professionals and save your time with your financial modeling tasks.