Keeping a business budget can be a tough job. You have to keep track of your incoming revenue as well as your outgoing costs. Thankfully there are a number of software apps that can help you to more easily do this. In this article I’m going to go over some of the best free business budgeting software on the market.
It is not always easy to keep track of your finances in a business. You may be doing fine, but it seems that every month you find yourself losing money unnecessarily. This would not be so bad if you had a budget in place so that you could set some money aside. But, even if you budget your money yourself, it can be difficult and time-consuming to keep track of all this information in your head. It is much easier if you use some software for this task.
usiness budgeting is a pragmatic approach to outline the financial and operational goals of an organization. A carefully considered budgeting process is essential to operate and benefit the businesses in the constantly changing market scenario.
Automated budgeting is in trend today. Organizations today are getting used to business budgeting process with the help of augmented and systematic software solutions for several reasons. According to a recent report, 43% of the US-based businesses use software to manage their annual budgets.
Budgeting software helps the organizations to estimate their future revenues and expenses and forecast the differential profit or loss.
While the majority of accounting platforms offer basic features of budgeting, organizations prefer adopting appropriate business budgeting software solutions to obtain advanced functionality with the budgeting process. Wondering how? Let us check this article.
Corporate or Business Budgeting Software
A budget is more than a set of numbers. It gives a vision to your company and determines what you can achieve in a particular period. Hence, the majority of firms gear up to have a sincere budgeting process for every fiscal year.
Smaller companies can rely on simply drafted short-term budgets, but for big organizations, corporate budgets are specially designed by the financial experts. The corporate budgets can be prepared for annual, quarterly or monthly financial plans and then, the budgeted data can be used to track the performance of the company against the actual result at the end of the year.
The old-school methods of budgeting have become far too onerous for the individuals as well as for the businesses. You can hardly see anyone these days carrying the old-fashioned ledger books to record their financial transactions. Even creating Excel spreadsheets sound like creating the world’s toughest homework assignment for some people. That’s where personal finance and budgeting software comes in.
If you ask what business budgeting software does, it makes the businesses getting used to automated budgeting process with the help of;
- The projected sales for the budgeted period.
- The direct cost of the sales.
- Fixed costs or overheads.
Capital Budgeting and Analysis
The capital budgeting process allows any business to understand and check its potential for large expenses and investments. Here, the experts analyze the estimated amount of money required to invest in the business along with the expected amount of revenue generation from the project. Sensitivity analysis leads a firm to determine the risk factor associated with a particular project while making capital budgeting decisions.
What is the 50-20-30 budget rule?
An American Senator Elizabeth Warren is the person behind this formula. In her book, “All Your Worth: The Ultimate Lifetime Money Plan,” there is a mention about the exceptionally popularizing 50-20-30 budget rule among the big, medium, and smaller market participants. It includes dividing after-tax income into three sections where 50% part of it should go to fulfilling unavoidable or most essential needs, 30% should go to the actual and inevitable wants and rest of 20% to the savings.
In the case of corporate budgeting, the terms differ. Here, the finances can be broken into three different areas i.e., 50% to necessary business expenses, 20% to financial goals and, 30% to organizational development.
Types of Budgeting Programs offered by the Budgeting Software Solutions
Businesses use majorly four types of business budgeting software solutions, and they are:
- Incremental Budgeting Software Program – It takes last year’s actual figures and subtracts or adds a percentage to obtain the current year’s budget.
- Activity-Based Budgeting Program – It includes the top-down budgeting approach where senior management prepares a high level of budget for the company based on its objectives and then pass it on to the managers for implementation.
- Value-Proposition Budgeting Program – In this approach, a budgeter decides upon why a particular amount is added in the budget, does the item included creates value for staff, customers or, stakeholders and is it overweighing its cost.
- Zero-Based Budgeting Program – This technique includes allocating funds based on necessity and efficiency instead of based on budget history. This budget is developed by the management and only consists of the operations and expenses that are essential to run the business.
1. QuickBooks Online
Best budget software for overall functionality.
Our top overall pick for the best budget software for small businesses goes to QuickBooks Online. Although QuickBooks is considered accounting software, it can automate virtually all of your business financial tasks, from invoicing and billing to sorting expenses. The user-friendly interface and dashboard let you easily track your budget and expenses.
Most importantly, QuickBooks Online has robust reporting capabilities. Small businesses can build their own customized reports or select one of QuickBooks’s own built-in reporting options, making it easier to generate profit and loss statements and other important financial reports. If you want to customize your software, QuickBooks also allows you to choose from hundreds of integrations.
QuickBooks Online offers four pricing plans for small businesses: Simple Start ($25 per month), Essentials ($50 per month), Plus ($80 per month), and Advanced, ($180 a month). No matter which plan you choose, you’ll enjoy (at minimum) these features:
- Invoicing and payments
- Income and expense management
- Track sales and sales tax
- Capture and organize receipts
- Run standard reports
You can also look into QuickBooks Self-Employed, which includes tools designed for freelancers, contractors, and other self-employed professionals. This software starts at $15 per month.
Pros
- Easy to navigate
- Various price points
- Customizable reports
- Multiple users
- Can separate personal and business expenses
Cons
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2. Xero
Best budget software for advanced features.
If you don’t want a lot of complex accounting features, but still want one of the best cloud-based
business budgeting software solutions, Xero is worth considering for your business.
With Xero, users can keep track of all of their accounts, invoices, and budgets in one place. Plus, Xero has made improvements to their more advanced features such as their expense and project management modules, both of which are particularly useful for budgeting.
Xero offers three pricing plans: Early, Growing, and Established.
The cheapest plan, Early, starts at $9 per month and includes Xero’s bare-bones accounting features and a limited number of invoices, quotes, and bills.
The Growing plan costs $30 per month. It includes everything in the Early plan plus unlimited invoices, quotes, and bills.
Lastly, Xero’s most expensive plan, Established, costs $60 per month. In addition to including everything in the Growing plan, the Established plan allows you to use multi-currency features, as well as the more advanced expense and project management tools.
Pros
- Excellent integration capabilities
- Relatively affordable
- Accessible user interface
- Strong customer service
- Unlimited users
Cons
- Limited reporting options
- Not ideal for larger businesses
3. FreshBooks
Best budget software for basic budgeting.
FreshBooks is another well-known business accounting and budgeting software for small to medium-sized businesses and is really ideal for businesses that want basic budgeting tools.
With FreshBooks, you can create and view estimates during budgeting. FreshBooks also allows you to control your budget efficiently with their expense tracking system. However, it is important to note that FreshBooks is not capable of handling complex budget planning.
There are four versions of FreshBooks: Lite, Plus, Premium, and Select. The Premium and Select versions are skewed toward larger businesses, while the Lite and Plus versions are geared toward self-employed and small to midsize businesses.
The Lite version is the cheapest option, and costs $15 per month and provides unlimited expense entries, unlimited custom invoices, custom functionality, and much more.
Pros
- Easily integrates with other web services
- Very easy to navigate
- Sophisticated reporting
- Simple invoice creation
Cons
- Can get very expensive with higher plans/adding team members
- Doesn’t allow for complex budgeting
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Conclusion
Where to start and doing a good job at managing your finances can be overwhelming. There always seems to be bills and invoices to pay, income to record and overheads that keep over running. It can be tough just trying to get on top of everything, let alone understand how your business is actually doing. The problem is, most business owners either under spend or overspend their budget every month, but never seem to stay in between! Whatever you do, it seems like you’re either short of money or flush with funds at the end of each month.