Build Your Budget
Developing a well-constructed budget is a critical part of the proposal preparation process. As you begin drafting your budget, carefully review both the solicitation and the sponsor's proposal preparation guide. Pay close attention to any restrictions or special requirements related to cost-sharing, tuition, allowable and unallowable costs, or other budgetary conditions.
A thoughtful budget should be developed alongside your project narrative - not as an afterthought. This is important for two reasons:
- Alignment with the narrative:
Developing your budget as you plan your project ensures that each cost is clearly tied to specific activities described in the proposal. - Reviewer expectation:
Reviewers assess the budget in relation to the narrative to confirm that the proposed personnel, effort, and resources are appropriate and sufficient for completing the work.
Most federal agencies provide either a required form or a prescribed budget format. Always follow the sponsor's instructions exactly. Although many agencies use standardized formats such as the SF-424, sponsors may impose additional requirements in their specific solicitation or FOA/RFP - so always verify.
Direct & Indirect Costs
Your proposed budget should reflect your best estimate of the financial resources needed to complete the project. Costs are generally divided into two categories:
- Direct Costs
Expenses that can be clearly and specifically attributed to the project, such as:- Salaries and fringe benefits
- Equipment
- Travel
- Materials and supplies
- Participant support
- Subawards
- Indirect Costs (F&A Costs)
Also called Facilities & Administrative (F&A) costs, these are expenses incurred for the general support of research and cannot be easily allocated to a single project (e.g., facilities, utilities, administrative infrastructure). Indirect costs are charged as a percentage of allowable direct costs. See F&A (Indirect Costs) for details on the University's negotiated rates.
Budget Justification
The budget justification (or budget narrative) explains and substantiates the line items listed in your budget. It is a required component and should demonstrate how each cost supports the proposed work.
Other Considerations
- All budgets must comply with applicable cost accounting standards.
- Budget estimates involve a degree of certainty - research is unpredictable. Experience will improve your estimating accuracy, and some sponsors allow flexible re-budgeting if needed.
- Always verify whether the sponsor imposes special rules related to salaries, participant support, equipment, or other cost categories.
