Use this project budget Excel template to help you plan, track, and manage your project finances effectively. Get your free project budget template.
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What is a project budget?
A project budget is the total estimated cost of completing each project activity over each project phase. It’s essential as it helps set expenditure expectations and is critical in getting project approval, ensuring funds are ready at the right time, and measuring performance. This dynamic document is constantly updated, monitored, and reviewed throughout the project.
How is a project budget different from traditional budgeting?
A traditional budget focuses on all activities of a company or department over a specific period. A project budget focuses on one project and only accounts for related expenses.
Who should use this free project budget template?
A project budget template is a great tool for anyone involved in project planning, execution, and financial oversight. Some users who can benefit from using our project budget template include: project managers and teams, business owners, finance and accounting departments, nonprofits, educational institutions, event planners, and more.
Why should businesses use a project budget template
Using a project budget template offers several advantages, including:
Customization: The project budget template is designed to be customizable to match the specific requirements of your project.
Automatic calculations: This project budget template in Excel incorporates built-in formulas that automatically calculate totals, variances, and other essential financial metrics.
Expense tracking: Businesses can monitor actual expenses against the budgeted amounts, identifying potential overruns and making timely adjustments.
Risk management: By anticipating potential costs and planning contingencies, businesses can mitigate financial risks and avoid surprises that could impact the project's success.
Transparency: Using a project budget template fosters transparency among team members and stakeholders.
The greatest resource businesses juggles is time. You only have so many projects you can take on so ensuring you’re getting a healthy return on a project is paramount.
Use a budget project template whenever you are taking on a project with associated costs. Even small projects have the opportunity for oversights that cut into your profits that you may not have known about if not tracking budgets.
If the costs of a project exceed the budget, a project budget template helps you understand why. You’ll know where you under projected and be able to diagnose why.
Over time, you’ll better understand the costs associated with a project. You’ll set more accurate budgets, modify prices to reflect the costs, and protect your profitability.
For this reason, it’s best to start using project budgets as early in the business’s creation as possible. The learnings are invaluable and will set you up for success.
How to prepare a project budget template in Excel
Here’s how to do a project budget in Excel:
Step 1: Download project budget template.
Step 2: Enter project information.
Step 3: Enter project tasks.
Step 4: Input each person’s hourly rate.
Step 5: Assign a person to each task.
Step 6: Input planned labor hours for each task and input actual labor hours as tasks are completed.
Step 7: Input expenses associated with each task (travel, equipment, fixed, miscellaneous, etc.).
The project budget template should automatically calculate based on information entered in the budget. You can find more detailed instructions on how to use our project budget template upon download.
How to get the most value out of a project budget template
Regardless of how much experience you have with project budgeting, you should follow these best practices to get the most value out of a project budget template:
Leverage historical data: Refer back to past projects to set budgets. If your historical data is disorganized, consider making some changes (like consistently using the template) to start building a bank of clean, concise data.
Embrace collaboration: Bring in the expertise of the people throughout the business, from the laborers to the finance pros and everyone in between. Every insight is valuable in building out a budget.
Regularly update the actuals: Set a regular cadence to update the actual expense levels in the template. You’ll want to catch expense levels above expectations early to adjust your plan.
Learn from the variance: When costs are higher than expected, take time to understand why. These learnings will inform future budgets so you’ll be more accurate and have a higher likelihood of keeping project spend in check.
Store past budgets safely: Keep each project’s budget template in a secure place for easy access, like online cloud storage. You’ll want to refer back to past project budgets for learnings and to get a head start on future project budgets.
Project budget template FAQ
What is the purpose of a budget template for projects?
Budget template for projects serves as a structured tool that helps in planning and managing project finances. Its purpose is to outline and organize the projected costs and expenses associated with the project.
What information does a project budget template include?
Elements found in a project budget template typically include information that helps in planning, tracking, and managing finances for the projects, such as:
Project name
Time period covered in the budget
Department
Project manager
Project tasks
Persons assigned to each project task
Planned and actual labor hours
Material costs and units
Travel expenses
Equipment expenses
Fixed costs
Miscellaneous costs
Variance of budgeted to actual costs
How do you start writing a budget for a project?
Get started on writing budgets by following these steps:
Define the project scope: Estimate how long the project will go on for and how much labor will be required to get it done.
Identify costs: The most common costs are labor and materials, but don’t forget to include any transportation, admin, and utilities costs associated with the project.
Consult with team members: Check your assumptions with members of your team—they may catch an error or identify a cost you overlooked in the first draft.
Estimate totals: Start associating numbers with each expense type. This step is about identifying your expected costs, not necessarily the budget you’ll adhere to.
Bucket expenses into categories: The two main cost categories for budgets are fixed costs and variable costs. Fixed costs will be the same no matter the scope of the project while variable will change if the project is shorter or longer than expected.
Allocate resources: This is where you start setting the budget. Look at your expected costs, give yourself a buffer room, and if you are looking to cut costs in a certain area, now is the time to plan how you’ll stick to that.
Review and adjust: Take your drafted budget to members of the team for review and adjust budgets based on any input that’s provided.
Track progress to targets: As the project progresses, update your budgets with your actual spend levels. You may need to revise your budget partway through the project if the scope increases or decreases.
Learn and iterate: Every budgeted project is an opportunity to learn about your budgets and your operations. It’s worthwhile to do a recap at the end of a project to understand where you may have budgeted too much or not enough for the work at hand.
Incremental budgeting: Look at a previous fiscal period and increase each expense category by a set increment or percentage.
Activity-based budgeting: Define the activities associated with your operations and set cost levels for each.
Zero-based budgeting: Starting with no costs, build out each department or facet of the business and assign costs only if they can be justified.
Value proposition budgeting: Analyze all existing expenditures to see what’s necessary before budgeting for any new expenses that are justified based on their value-add.
Flexible budgeting: Budgets are set based on expected volume or revenue and are adjusted as time goes on.
Can this project budget template be used in Google Sheets?
Yes, download our project budget Excel template. Then in Google Sheets, follow these steps:
Create a new or open an existing spreadsheet.
Click File. Import.
Choose the Excel project budget template file and click Select.
Choose an import location option: Create new spreadsheet, Insert new sheet(s), or Replace spreadsheet.
Click Import data and you should have this project budget template in Google Sheets.
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