Monthly IT Budgeting

When you own your own business, sticking to a monthly budget is integral to your success. A budget allows you to plan for the future, create estimates, and know your costs so you can stick to running your business instead of worrying over finance reports.

It can seem daunting at first to create a monthly budget for IT expenditure, because it’s easy to view IT spending as nebulous from month to month, depending on what mystical and arcane deities are in control of virus infection or hard drive crashes. Balances seem like they sway greatly from month to month – so how do you create a reliable budget?

The most important thing to do first is relinquish the idea that budgeting IT isn’t possible. With the right system, monthly budgeting IT can be accurate and balanced. Before designing a budget, the second most important thing to realize is that most IT expenditure should not be spent on the break/fix tech support that makes budgeting seem unbalanced, but preventative maintenance that makes break/fix tech support less necessary.

With those two ideas in mind, let’s look at the five categories of a typical IT budget:

• Software license renewals
• Hardware maintenance and warranty renewals
• Preventive Tech Support (updates, patches)
• New hardware and software purchases
• Unexpected tech support (like virus removal,crashes)

Several of the items on this list are yearly, not monthly, expenses, so keep that in mind. Begin by calculating technology costs from previous year and finding the average per month – this will give you a baseline. Next, allow for expansion plans and inflation. Although you can’t predict how much unexpected tech support that will be needed in any given year, the newer your hardware and more up to date your software, the fewer problems you’ll have.

Remember, when looking at IT budgeting, that erring on the side of caution for preventative tech support can vastly reduce unexpected tech support costs. A server or workstation that’s under warranty and kept up to date anti-virus definitions and the latest patches, is less likely to have errors that cost you extra money. Keeping your software and hardware up to date will result in larger once a year fees, but will lower the amount of time spent fixing problems. This helps your budget be more accurate and helps you better plan your monthly costs.

It’s easy to think that budgeting for monthly IT costs isn’t possible, considering how unpredictable unexpected tech support can seem. But when looked at as part of a larger picture that includes yearly renewals and preventative maintenance, the unexpected tech support is a smaller percentage than it appears.

This means that averaged out over a year and intermixed with yearly costs, budgeting for monthly IT costs is very feasible. If you need help drafting a monthly budget, give Alliance Technologies a call. We’d be glad to help.