How to Create Budgets in Xero

Keep track of your income and expenses by setting up and using budgets in Xero.
Use Xero’s Budget Manager to create a budget quickly and easily. Import budgets from Excel into your Xero organisation. Add budgets to your reports and compare your business performance.
Help set business goals by creating a budget and understand how well your income and expenses are tracking.
Create budgets for your tracking categories in Xero to compare against actuals for improved departmental reporting.
Run the Budget Variance report in Xero. Filter the Budget Variance by tracking categories.
Customise your dashboard to add budgets and quickly spot variances in your most important accounts.
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Video contents:
00:00 Benefits of using budgets
00:36 Add a budget using Budget Manager
03:18 Export a budget
03:36 Edit your budget in a spreadsheet
05:20 Import a budget
06:06 Create a budget for a tracking category
06:56 Copy a budget
07:56 Import a 5 year budget
09:31 Budget Variance report
10:39 Run the Budget Variance by tracking category
11:11 Add a budget to your Dashboard

[@flash63ful]

Thank you. This was helpful, clear and concise.

[@xeroguru]

Thank you so much for taking the time to comment. I appreciate it! 😊

[@Sho-qb9pl]

Good easy to understand

[@xeroguru]

Thanks for taking the time to comment. It’s great to hear you find the video useful!! 😊

[@MohammadNurulImam-ic6ym]

very helpful! thank you Jon

[@xeroguru]

Thanks for taking the time to comment. I’m happy you’ve got value for this video! 😊

[@user-ju8pk7ek8d]

Thank You ! ~ Michelle.

[@xeroguru]

You’re welcome. Hope you found it useful.

[@FineTuningAnalysis]

Great Video!😎😎

[@xeroguru]

Thanks for taking the time to comment! I’m thrilled that it’s useful! More videos like this on the way soon…!

[@FineTuningAnalysis]

@@xeroguru Do you have an email I could contact you on a potential collaboration?

[@xeroguru]

it's [e-mail]

[@MaryGustafson-ly1qq]

Can I make a report that shows Month Actuals, YTD Actuals and Annual Budget

[@xeroguru]

Absolutely! Open the P&L report: - choose the date range (eg this month) - click “Compare with” and select the number of months you want - click “Update” - click “More” and select “Year to date” - click “Update” You now have a month by month report with a YTD column Click “Edit layout” to open the layout and editor. - click “Columns” at the top and select “Budget”. This adds a budget column for the current month. - click the budget header to open the panel on the right. - change “Date range” to “Year to date” or “Financial Year” (depending on what you want to see - click “Update layout” Now you have a month by month P&L, with YTD actuals, and an annual budget. Don’t forget to save this as a custom report to you can run it again!

[@philmarks4473]

how do you change the cost categories or delete some?

[@xeroguru]

Do you mean changing the names of accounts (eg changing "Bank Fees" to "Bank Charges")? If so, account names can be changed in the Chart of Accounts. Or do you mean changing the headings (eg changing "Less Operating Expenses" to "Overheads")? If so, this can't be done on the Budget Manager screen, but you can change those headings on a report (eg the Budget Variance report), in the same way as you can change headings on almost any report. One exception to this is the Budget Summary, which is an older style report that Xero hasn't yet updated. If you do want to customise those headings on a budget report, you could create your own custom budget report with whatever headings you like. That would work nicely, but it's a bit of work! (and it wouldn't affect eh Budget Manager screen in any way). Hopefully I've understood your question (?)

[@dondatu2095]

Can you use your own Budget format?

[@xeroguru]

You can customise reports that feature a budget (eg the Budget Variance or a schedule of expenses with a budget comparison). You can't customise the Budget Manager screen. Is there something specific you're trying to achieve?

[@rudeboyrg]

Looks horrid. Why can't there be an accounting software that actually has a descent budgeting system built in. YNAB has done it best and since then no business software can replicate the budgeting capabilities. Don't know why. I'm assuming after accounting, budgeting just isn't a priority for them. I've used Xero. And while it's more user friendly, the budgeting, I could probably do a better job on just Excel.

[@xeroguru]

Agree that it’s due for an overhaul. Hopefully Xero will give budgeting some love soon.