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Budgeting for the unknown – Contingency strategies and tips for businesses
12 February 2025

No matter how well-prepared you may think you are, things will not always go to plan.

It could be a sudden shift in the market, supply chain disruptions, unexpected repairs to your office or equipment, or even a personal emergency.

That is why having a budget that accounts for the unknown is essential.

How to budget effectively

Here are some of the strategies to help you build a budget that is proactive:

Build a contingency fund – Set aside some of your income for those unplanned moments. The amount you save will depend on your business’s expenses and profits. If you are unsure how much to put aside, speak to an accountant.
Review your budget regularly – Make it a habit to periodically review your income, expenses, and savings goals to ensure you are on track. This allows you to adjust for any changes without derailing your entire plan.
Categorise your costs – Sort your costs into categories like operational expenses, marketing, payroll, and overheads. This will help you quickly spot areas where you may be overspending or where savings could be redirected into more critical areas.
Avoid unnecessary spending – It can be tempting to buy new gadgets or upgrades but do not let these purchases compromise your financial security.

While you cannot always predict what lies ahead, that does not mean that you cannot prepare for it.

By budgeting effectively, you can ensure your business remains resilient in the face of uncertainty and proceeds to grow with confidence.