Step 3 (continued). Calculating an Annual Fundraising Goal

To establish an overall fundraising goal, there are two simple methods:

1. Create an expense budget and use the amount of your total expenses (plus a modest surplus) as your fundraising goal.
2. Start with last year's income. Add a modest amount to allow for realistic increases in fundraising. Subtract any amount from unusual sources that you don't expect to be repeated this year (e.g. a bequest).

If you already have some expected income and simply want to calculate how much additional fundraising you will need to do, use the following formula:

1. Add up all of the program expenses (both direct and indirect) from your budget, taking into account any cost reduction methods you may have employed.
2. Next, calculate the guaranteed revenue for the next year. Guaranteed revenue is income that has already been secured for the upcoming fiscal year. This revenue could include multi-year grant money, interest income from an endowment, or earned income from renting a portion of your property.
3. You can now calculate your fundraising goal by subtracting your guaranteed revenue from the total of your program expenses:

Additional fundraising goal = expenses (plus 5%-10% surplus) - guaranteed revenue

Below is an example of a calculation of an additional fundraising goal.

Example formula for calculating your fundraising goal.

The example shows a worksheet for a sample watershed group showing costs and expenses totaling $279,650, a 5% surplus of $13,983, and expected revenue of $275,500. The answer is calculated using $279,650 (expenses) plus $13,983 (5% surplus) minus $275,500 (revenue) for a fundraising goal of $18,133.

Citation: See Resources, Works Cited #8