Whenever your nonprofit organization applies for a grant, you will have to create a detailed project budget. When preparing your budget, treat your potential grantor as an investor in your project. As you would with any investor, you must demonstrate to the grantor that your organization:

• Has designed a project that will have long-term benefits
• Has secured funding from other sources
• Will maximize the grantor's funds
• Will provide a high return on the grantor's investment 

Grant Budget Tips

Follow the additional tips below to create your grant application budget.

Don't pad your budget. Be reasonable and realistic when thinking about your project's expenses. Here are a few examples:

• If one of your staff is paid by a dedicated fund or government source, don't double dip and request a salary offset from a grant funder.
• Unless a new computer is absolutely necessary for the project you want to fund (such as needing a new computer to support the software required to complete the grant project), don't include this item in your budget.
• Unless your project involves a lot of mailing costs, don't include letterhead or postage expenses in your budget.

Describe cost savings. Any project expenses that do not require a cash outlay should be included as part of the budget to be matched by the grant.

• A board member or other volunteer may be able to provide an isolated service for the grant project, such as instructor, graphic artist, or accountant. The dollar value of volunteer support will vary based on the kind of work contributed. The Bureau of Labor Statistics provides an updated, state-based list of average wages.
• If your office is co-located with another nonprofit that is willing to share equipment, you might be able to get matching funds. Check with your funder before you include the value of donated equipment. Some will only count cash donations as your organization's match.

Include inflation and salary increases in multi-year grants. If your project will take more than a year to complete, adjust your personnel costs to correspond with planned raises.

Keep personnel costs reasonable. Your personnel costs should not be more than one-third to one-half of your overall project budget.

Be specific. Don't include a miscellaneous line item. Expenses should be clearly defined within your budget. Check to see whether your potential grantor wants your estimated local travel costs broken down. Some grantors do, some do not.

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