HOA Budgeting – How to Save Money in Your HOA this Summer:
As a member of the HOA Board, you have a fiduciary responsibility to the Association. What does this mean? Most basically, it means that you are entrusted with a certain degree of responsibility over the HOA’s finances, and it’s expected that you use community resources in a way that’s smart, responsible, and in everyone’s best interests.
This means spending money when you need to—and when you have it—but also looking for ways to cut costs wherever possible. Whether you’re already over-budgeted for the year or just want to get a little more wiggle room, there is no time like the present to look for potential cost savings.
- Review vendor contracts. See which vendor contracts are up for renegotiation soon, and also look to see what sort of competition is out there and whether you might have a potential to find some cost savings.
- See if you are overpaying on your HOA insurance. Go over your policy with a fine-toothed comb. Ask your manager for assistance with this.
- Start emphasizing communication with owners. Redouble your efforts to communicate with homeowners about expectations, about payments, and about the goals and achievements of your Board. Hopefully, this will have a two-pronged effect—minimizing the need for legal expenses and also minimizing delinquent payments.
- Educate Board members. Invest in some basic financial training for all Board members. Well-educated Board members will be in a better position to responsibly utilize HOA funds.
- Have someone else look at your budget and operating expenses. Schedule time with your manager to go over the budget. Having a second set of eyes is sometimes all it takes to identify potential savings!
Again, there is no time like now to start saving your HOA some money but it starts with proper planning in the HOA Budgeting process.