Unless you are a person with a numbers-kind of mind, budgets may be confusing to you. Here are some things that you might want to keep in mind as you learn about budgeting:
- A balanced budget is when what is taken in equals what is spent. A surplus budget anticipates more money coming in than what may going out. A deficit budget is not to be desired, and hopefully a long-range plan is in place to keep those over-expenditures under control.
- Budgets are done annually. The United States fiscal year runs from October 1 to September 30.
- The Capital Budget allocates money for purchasing and maintaining fixed assets
such as land, buildings, and equipment.
- The Operating Budget is more complicated. The fixed expenses are known, but the anticipated expenses must be guessed at. Income also can be a bit dicey as it depends on both past sources of income holding steady and anticipated future income happening as expected. It almost borders on the prophetic.
- The Capital Budget and the Operating Budget may not borrow money from each other.
- The President of The United States (POTUS), with the help of the Office of Management and Budget (OMB) is required to submit an annual budget proposal to Congress.
- The House of Representatives and the Senate, with the help of The Government Accountability Office (GAO), pass budget resolutions, create appropriations bills, vote on them, and then argue until they compromise. . . or not.
- The President of The United States signs each appropriations bill as it comes to him/her to make the budget become law.
- The budget process is complicated, but the budget itself is comprehensible. You can read the proposed 2018 budget here.
- Everyone, politicians, corporations, the military, nonprofits, the everyday citizen, and everyone else, is affected by what is in the budget and what has been cut out. It bears watching closely.