It’s a New Year, and if you’re an Aurora, CO HOA board member, it’s time to plan your community’s annual budget. Your association’s annual budget projects the year’s estimated costs and ensures that the community association has enough to cover every project and any potential emergencies. The board also uses the budget to help determine annual dues. While it may feel overwhelming, creating your community’s budget is a significant and essential task. Fortunately, we’ve put together some tips to help you plan your HOA’s annual budget and ensure its success in the coming year.
Build the Right Task Force
Such an essential task requires dedicated and qualified team members. You may want to create a committee solely dedicated to making the annual budget. Consider committee members with key players who will maximize your community’s success: select board members, the board president, the board treasurer and your HOA community management firm. HOA financial management is one of the most important aspects of a thriving community association, so trusting seasoned HOA management firms such as The Management Trust will help ensure that creating a budget is done carefully and accurately.
Examine Last Year’s Expenses
Although your budget will inevitably change from year to year, the change from one year to the next likely won’t be dramatic. As such, looking through the previous year’s budget and expenses will help you better understand what to expect in the coming year. Look at last year’s planned budget, actual expenditures, projects completed, emergencies handled and more. This will help you gain the most accurate picture of what your next year’s expenses are likely to look like.
Discuss Next Year’s Projects
Every HOA has projects and to-dos that they want to have completed each year. Whether it’s maintaining an amenity, repairing infrastructure or upgrading communal areas, prioritize the new year’s projects and gather an estimated cost for each one. Send requests for proposals or estimates from vendors to ensure your numbers are as accurate as possible. When in doubt, round up and estimate the cost to be more than projected so you’ll have enough money set aside to cover the project when the time comes.
Expect the Unexpected
No matter how much meticulous planning you do, it’s inevitable that there will be an unpredictable emergency or two throughout the year. These emergencies can include dues delinquencies, property damage from natural disasters, or an unexpected legal bind. Whatever the cause, your HOA’s budget should always have a cushion to cover these unanticipated expenses. Your HOA management company can help you determine exactly how much money should be set aside in your reserve fund for these occasions.
If you could use a helping hand with financial planning, budget coordination, or any other aspect of day-to-day community association management, turn to an industry-leading HOA management firm like The Management Trust. With more than 1,500 communities nationwide, we offer the resources of a national corporation with the personal touch and care of a local service. Whether you need HOA financial management or conflict resolution, we can handle it all for your Aurora, CO HOA. To learn more about how The Management Trust can help your community thrive, give us a call at (303) 750-0994 or fill out our online contact form today.