5 Top Budgeting Strategies for Sororities and Fraternities
When it comes to fraternity and sorority management, overseeing finances is a crucial, yet challenging part to master. After all, a comprehensive budget takes time to create, but you have classes, extracurricular activities, and other managerial responsibilities to juggle.
If you’re anything like most college students in your position, you likely don’t have extensive financial experience beyond handling your own paychecks. But, never fear—you don’t have to go it alone. Try the following budgeting pro tips to guide you through the entire process, from setting your first goals to evaluating your success at the end of the year:
- Train your executive board in financial management
- Set a realistic budget based on your goals
- Review your spending regularly
- Use budgeting software
- Involve your members
Let’s get started!
1. Train your executive board in financial management
The accuracy of your chapter’s budget affects the opportunities you’re able to offer to your brothers or sisters. With so much on the line, it’s crucial to set your fellow decision-makers on the executive board up for success.
To make sure everyone has the foundational knowledge to make sound budgeting decisions, implement a training program for incoming executive board members before each year begins. List these as mandatory meetings in the role description for each member so everyone knows what’s expected of them before they apply. Depending on your available funds and resources, you can include the following activities in your training sessions:
- Online financial literacy lessons
- Finance and fundraising lessons taught by alumni volunteers or outgoing executive board members
- Group discussions to practice creating budgets based on case studies
Whichever format you choose, be sure to pick updated educational content designed for beginners. To get the most out of your training sessions, consider polling your executive board members beforehand to gauge their financial literacy, then pick the complexity of content accordingly.
2. Set a realistic budget based on your goals
As with any strategic planning endeavor, your goals should guide every choice you make. When creating your budget, keep the following expenditures in mind:
- Chapter house expenses, such as rent, repairs, or house parent pay
- Philanthropy event expenditures
- Social events and retreats
- Recruitment programs
- Emergency fund
Once you understand your costs, start to predict your different revenue streams and brainstorm new ones you could add. Your primary revenue comes from membership dues and fees, but you can also raise money by launching fundraising campaigns for your chapter that are unrelated to your philanthropy efforts. If you’ve hosted these in the past, use your existing data to estimate how much money you’ll bring into your chapter.
Also, don’t forget about your tax-exempt status! You can save thousands of dollars every year by filing as a 501(c)(7) with the IRS. If you’re working with an accountant to file your tax forms, factor their fee into your budget and include a note explaining your tax-exempt status.
3. Review your spending regularly
The most successful and accurate budgets are dynamic, so it’s up to your team to periodically regroup and revise your plan whenever necessary. After all, you never really know what could happen, and you might need to adjust your budget to accommodate any unforeseen expenses or revenue influxes.
You and your fellow executive board members have a lot on your plates, so you don’t have to meet weekly, or even monthly, to gauge your budget’s success. Consider setting a default meeting time every other month to evaluate your financial plan.
That being said, if you’re experiencing roadblocks or financial stress, establish an ad hoc process for requesting a meeting outside of the normal schedule. For instance, if a large sponsor pulls out from your campaign, meet with your executive board to shuffle around funds to mitigate any damages. Over-communication is better than none at all!
4. Use budgeting software
While nobody’s perfect, you want to avoid making mistakes as much as possible when creating your budget. After all, imagine what could happen if you accidentally include an extra zero at the end of an expense! That’s why budgeting software can make a huge difference in your efficiency and effectiveness.
There are many software solutions that cater to different types of organizations and their needs. You should look out for fraternity and sorority management software solutions in particular. OmegaFi recommends using a top-notch chapter management platform that can:
- Generate financial reports that help shape your budget
- Process member payments, such as rent and annual dues
- Maintain nonprofit data hygiene by storing payment, contact, and demographic information in member profiles
And, of course, remember to choose a platform that fits your budget. That’s another reason why fraternity and sorority management software is an ideal option—it’s made with your chapter’s resources in mind. Other platforms, like silent auction software for fundraising events or an emailing platform for newsletters, can also streamline your chapter’s operations.
5. Involve your members
Your executive board’s financial decisions have a significant impact on your entire chapter, so it’s only fair that you loop everyone in on budget updates and how they will shape your initiatives. This doesn’t mean you have to share everything, though! It’s best to update your members only once changes are finalized and you have an idea of what the impact will be. Telling them everything and doubling back in real time might cause confusion and disunion within the chapter.
Besides keeping your members privy to important financial shifts, you can engage them by surveying their opinions on which programs they want to see. Taking their feedback into account reflects well on your executive board and gives you guidance on what to prioritize during the budgeting process.
Making high-stakes financial decisions for your chapter doesn’t have to be overwhelming. Remember that you have many brothers or sisters on your side to back you up and provide input on how to allocate funds. As long as you understand your fundraising goals, append and maintain your data, spend responsibly, adapt your financial plan, and use technology to perfect the process, budgeting for your chapter can be a productive experience for both you and your chapter at large.