Wednesday, July 15, 2015

How fire departments stay financially smart

You ever wonder why some fire departments have so much... and others so little?

This is the first of a 3 part series on the importance of having a fire department budget.  The reason I talk about this is a budget is the one thing that always seems to separate the haves from the have-nots.

Why having a budget is so important

Last week, I wrote about a fire department who literally fund-raised themselves into being broke.  They spent more on the fundraising costs than what they earned.  If they would have just eliminated the fundraiser, they would have had more money for equipment.

How can that be?   Simply, the fire department did not use a budget.

A budget is like a dashboard.  It gives you clear information about what is happening. So, you can adjust as the situation changes or to problems as you recognize them earlier.

Instead of your board meeting financial report sounding something like:  We paid the bills and here's how much we have in the account , you have reports like:  We are on track to have the best year ever.  Or, we are short on saving up for the next truck. Or, we actually spend more on fundraising costs than what we earn.

Summary

A budget is a great tool to understand and predict your situation.  You'll always know if you are "on-track" or "off-track" and can adjust as needed.

Stay safe!
John R. Hill
President
First Bankers

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