HOA budgeting is never particularly fun, but the last few years have made it even more challenging. Inflation, rising insurance premiums, and rising interest rates have made financial planning and forecasting more difficult for HOAs and condo communities. While inflation is cooling and the Fed appears poised to cut rates, no association wants the risk of special assessments due to budget shortfalls. 

Most boards begin scrambling to prepare budgets for the following year in late summer. However, Lindsey Richardson, a CINC Systems sales engineer with deep experience in association management, property management, and retail banking, recommends a more prolonged approach that can help with budgeting accuracy and alleviate that last-minute stress.

“Start a draft of next year’s budget at the beginning of the year,” she says. 

The first draft should consider your association’s goals and priorities, such as making repairs or increasing reserves. You can also use past financial statements and tools like the CINC Budget Module to view your association’s financial data over time and make more educated guesses about the following year’s needs.

Once the initial heavy lifting is over, monthly check-ins and tweaks will help you fine-tune the budget to account for evolving needs, cost increases, or unexpected expenses. 

“Set a calendar reminder to review your budget draft regularly,” Lindsey recommends. “Consistency is key to making this process smooth and stress-free!”

While this agile approach requires some discipline, it reduces the headache of tracking expenses and paperwork later in the year. Did your landscaper or sanitation service announce a fee increase? Open the budget draft and edit the recurring expense while it’s already top of mind. Were you informed your clubhouse needs a new roof within the next two years? Add it to the budget now.

By the time budget season actually arrives, all that’s left to do is double-check numbers and make any final adjustments before submitting the budget to the board for final approval. Busy board members are sure to appreciate your vigilance and attention to detail throughout the year.

Pro tip: Budget planning season is also the perfect time to consider what investments you can recommend now to help your associations run more smoothly and efficiently. Tools like CINC’s AI-powered Homeowner App can help improve communications, free managers from answering routine calls and emails, improve homeowner data security, and streamline payments. Take a tour here!