How to Create a Party Budget: A Step-by-Step Guide for Stress-Free Planning
Planning parties is fun and exciting! What’s not fun and exciting? Planning the budget for your parties. While it’s the most tedious task on your to-do list, having a well-planned budget will prevent any surprises and ensure the party runs smoothly. Additionally, your parties should not drain your bank account.
While planning a budget for your party can be dull, it doesn't have to be intimidating. Don’t worry! We won't lose sleep over it.
This blog can serve as a guide to help plan your next party budget.
Determine your Budget
Set a Spending Limit
Planning the budget for your party should be done after you have finalized what kind of party you are planning and your guest list. Knowing the venue of your event in advance will help you create a more accurate budget. When deciding on a budget, conduct thorough research to determine the typical cost of a party like yours. Please do not set your budget too low, nor too high. Set it at a range that you are comfortable with spending, and that, if needed, you can adjust.
Create your party budget at least 2-3 weeks in advance for small gatherings. For elaborate parties, allow 3-6 months, and for more extravagant events, 6 months to 1 year is ideal. You will have sufficient time to plan and stay within your budget.
At the same time, you do not want to keep adjusting the point where you can include everything on your list. That will defeat the purpose of having a budget.
For parties such as house parties, dinner parties, birthdays, and similar events, a budget of $100 to $250 is a good range. However, if the party is more elaborate, the cost can range from $500 to $ 1,000. For events being held at a venue with more intricate planning, the budget can range anywhere from $5,000 to $10,000 or even more.
Create an Item List
Create a list of essential items for your party. These are items that you must have at your party. For example, if your kid’s 1st birthday theme is an animal circus and you want the decorations to reflect the theme, then this would be considered an essential item. Even a birthday cake is regarded as a critical item. If you are hosting your annual galentine dinner and you always serve your famous casserole, then that is considered an essential item.
Once you have determined what are considered must-haves, make another list of items you would like but do not really need. For example, at your wedding, you would like a live painter. A petting zoo at your kid’s 7th birthday is another example of items that would be nice to have.
Once you have both lists, do your research and estimate your cost. The goal is to stay within your budget. Look around and see where you can get a reasonable price for the items on your list. With that being said, do not cut corners to stay within your budget. Now, what I mean by this is that you don’t want to rent tables and chairs from a place that offers a ridiculously cheap price compared to other places you have looked into. Look for areas where the prices seem reasonable and affordable.
Allocate Emergency Fund
Once your spending limit has been determined and you have estimated your costs, create an emergency fund. An emergency fund, also known as a contingency fund, is a sum of money (usually 10-20% of the total budget) set aside in case something goes wrong. Say you are hosting your Thanksgiving dinner party, but unfortunately, your pumpkin pie this year did not turn out the way it usually does. You can use your emergency fund to serve a store-bought one. It’s always good to have some extra money in hand just in case. Remember, this is your emergency fund; use it if you absolutely need to.
Categorize your Budget
Every party has six categories: venue, food and drink (now it’s up to you whether to categorize food and drink separately), entertainment, decorations, and miscellaneous. Miscellaneous items include tips for staff, a photographer, a photo album, or a photo booth along with other items.
List all the items from your must-have and would-like-to-have under each category, along with the total amount for each category. The total for each category, when added up, should not exceed your total spending limit. If it does, don’t panic. You have to figure out where you can make some compromise. For example, if you can do without the chocolate fountain, then opt out. Alternatively, if you can find an online store that sells more affordable decorations than your local party store, consider purchasing from them.
Determine your Fixed Cost and Variable Cost
Fixed costs are anything that, regardless of the circumstances, the cost remains fixed. For example, venue rental or catering services typically have fixed prices. Most entertainment, such as DJs, live bands, or singers, would be considered fixed costs. You can always negotiate the price, but it's most likely already fixed.
Variable cost is anything that you have control over—serving a $20 store-bought birthday cake over a $200 custom birthday cake. While it would be great to display a $200 custom birthday cake, at the end of the day, they’re both going to taste like happiness served on a plate. Decorations are usually considered variable costs. Party favors can also be regarded as variable costs.
Hope this blog helps you plan the budget for your next party with ease.
If you enjoyed this, you’ll love my other blogs where I share more ways to plan with style, ease and a little sparkle!
