Setting a budget for your blog

Imagine you were going to open a small shop. Before you started, you’d write a budget for the signage, stationery, advertising, your wages and all the other things that any sensible business person would do, right?

So why is it different for bloggers? And I’m not talking about hobby bloggers here, I’m talking about bloggers who are aiming to earn or are currently earning money from their blogs. I’ve had three conversations in the last week with people in that category, and they all went very quiet when I asked them about their budgets.

I think one of the problems we face is that blogging is either free or very cheap to get into to, and for that reason, although we want to make it a business, few of us treat it as such from the beginning. Well now’s the time to change! Actually set yourself a budget, starting today. Here are the benefits you’ll get from doing so:

• No more hand wringing while you wonder if you can afford to buy something. It’s simple, if it’s in budget you can buy it, if not you can’t. When I first started (with a very small budget) I sometimes had to wait three months before I could buy something I wanted for the site, but that discipline worked for me.
• You’ll know how much money you’re really making. If you don’t have a budget, it probably means you don’t keep proper accounts. You may be “Making” $500 a month from your blog, but are you taking into account the fact that you’re spending $600?
• You’ll get more support from your partner. Many bloggers struggle to get agreement to spend “yet more” money on their blogs from their partners, particularly in the early days when income is low or zero. Draw up a budget, which will show what you’re going to spend and when the investment will be recouped and get his or her approval.
• You’ll get more support from your bank. If you ever need to take out a loan for equipment ,your case will be so much stronger if you can present a business plan and budget for the coming year.
• You’ll be less stressed.Knowing what you need to do reduces stress and help your subconscious mind to work away for you in the background.

You don’t need accounts programs or packages to write a simple budget – any spreadsheet will do, and you can even hand write one on a piece of paper. Start with how much you are prepared / able to invest in your business as a top line figure, then compare that with your financial objectives for the blog. Let me give you an example from one of my Beginner’s Guide to Blogging students:

• She wrote a budget showing that her monthly running costs for her blog were going to be $107. It broke down as follows:

Once this was written, she then compared it to her blog objectives, which showed her planned earnings, and they told her that she would be covering those costs by month 5, but by working out a simple cashflow chart she could see that she would need to “front” her business with $252 as that was the amount she would go into the red by in month four. She got her husband to agree that the $252 could come from the family budget and she opened a separate account to keep track of it.

Do you have a simple budget for your blog?

Maybe also have a look at:

1/ When  to start making money from your blog

2/ Measuring and recording income statistics on a blog

3/ A traffic and income spike on my blog