Insights
Grant Budget Template and Budget Narrative Example
A grant budget lists every cost by category, with the math behind each one. A budget narrative explains what each cost is and why the project needs it. Download our free Excel template, which uses the standard cost categories and does the totals and indirect cost math for you. Then use the $150,000 example below as a model.
Download the grant budget template (.xlsx)
Free. No sign-up, no macros. Works in Excel, and in Google Sheets if you upload it to Drive and open it there. The file opens with the fictional example below filled in so you can see how it works.
What are the grant budget categories?
Most grant budgets use some version of the same categories: personnel, fringe benefits, travel, equipment, supplies, contracts, other costs, and indirect costs. Foundations often give you their own budget form, so use it when they do. The template follows the federal SF-424A version of these categories, shown below, because it’s the most detailed, and it’s easy to fold into a simpler form.
| Category | What goes here | Common mistakes |
|---|---|---|
| a. Personnel | Salaries and wages of your own employees for time spent on the project (2 CFR 200.430) | Listing consultants here. Charging 100% of someone who also works on other things. No time records to back it up. |
| b. Fringe benefits | Payroll taxes, health insurance, retirement, and other benefits on those salaries (2 CFR 200.431) | Applying the rate to consultants or contractors. A rate you can’t show from your books. |
| c. Travel | Trips by employees in travel status: transportation, lodging, meals (2 CFR 200.475) | Putting local mileage here (it goes in Other). Putting non-employee travel here (it goes in Contractual). |
| d. Equipment | Items with a useful life over one year that cost at least the lesser of your capitalization level or $10,000 each (2 CFR 200.1) | Listing laptops here. Forgetting that equipment is left out of the indirect cost base. |
| e. Supplies | Tangible items below the equipment threshold, including most computers (2 CFR 200.453) | One lump line like “Supplies: $10,000” with no detail. |
| f. Contractual | Contracts, subawards, third-party evaluators, and third-party rentals used for the program | Mixing up subrecipients and contractors. Counting more than the first $50,000 of a subaward in the indirect base. |
| g. Construction | Construction or major renovation, only where the program’s law allows it | Using it for minor repairs. Budgeting it when the program doesn’t allow it. |
| h. Other | Individual consultants (2 CFR 200.459), local travel, participant support, training, printing, and similar costs | A “miscellaneous” line. Applying indirect costs to participant support. |
| j. Indirect charges | Your indirect rate times its base, such as 15% of modified total direct costs (2 CFR 200.414(f)) | Applying the rate to total costs instead of the base. Charging the same cost as both direct and indirect. |
Category placement follows the SF-424A field instructions (OMB 4040-0006). Those instructions still mention a $5,000 equipment threshold and a 10% de minimis rate. Both figures predate the 2024 Uniform Guidance, which raised them to $10,000 and 15%. Follow your funding notice and award terms.
How do I use the grant budget template?
- Open the Budget tab and fill in the yellow cells at the top: your fringe rate, your indirect cost rate, and the subaward amount counted in the base.
- Enter one line item per row: pick a category, then enter quantity, unit cost, and units. For salaries, quantity is the FTE, unit cost is the annual salary, and units is the share of the year.
- Mark each row Include, Exclude, or Subaward for the indirect cost base. The template applies the $50,000 subaward cap for you.
- Check the SF-424A Summary tab, which totals each category the way Section B asks for it (lines 6a through 6k).
- Write the narrative, using the Basis column as the starting point for each line.
Grant budget example: a $150,000 program
This example is fictional. Harbor City Youth Mentoring is a made-up nonprofit running a 12-month youth mentoring program called Pathways Mentoring, and the numbers are there to show the method, not to serve as benchmarks. The same budget comes filled in in the template. It’s written as if for a federal funder, so it uses the 15 percent de minimis rate. For a foundation, use the rate in its guidelines.
| Category | Line item | Basis | Amount |
|---|---|---|---|
| Personnel | Program Coordinator | 1.0 FTE x $50,000 salary x 12 months | $50,000 |
| Personnel | Mentor Supervisor | 0.5 FTE x $44,000 salary x 12 months | $22,000 |
| Personnel | Executive Director (oversight) | 0.05 FTE x $90,000 salary x 12 months | $4,500 |
| Fringe Benefits | Fringe on all personnel | 24% of personnel costs | $18,360 |
| Travel | Airfare to regional mentoring conference | 1 staff x 1 round trip | $450 |
| Travel | Lodging | 1 staff x 3 nights | $540 |
| Travel | Meals and incidentals | 1 staff x 4 days (example rate) | $272 |
| Supplies | Laptops for program staff | 2 laptops x $1,100 (below equipment threshold) | $2,200 |
| Supplies | Mentoring activity kits | 40 youth x $45 | $1,800 |
| Supplies | Office supplies | $50 per month x 12 months | $600 |
| Contractual | Third-party program evaluation | Fixed-price contract | $7,500 |
| Contractual | Subaward: Eastside Schools Partnership | School-site coordination at 3 schools | $12,000 |
| Contractual | Saturday program space rental | $400 per month x 10 months | $4,000 |
| Other | Mentor background checks | 40 mentors x $35 | $1,400 |
| Other | Local mileage for staff | 2,000 miles x $0.70 (example rate) | $1,400 |
| Other | Mentor training (individual consultant) | 2 sessions x $750 | $1,500 |
| Other | Participant support: youth transit passes | 40 youth x $70 | $2,800 |
| Total | Total direct costs | $131,322 | |
| Indirect | Indirect costs | 15% x $124,522 MTDC base | $18,678 |
| Total | Total request | $150,000 |
Budget narrative example
A budget narrative, also called a budget justification, explains each cost: what it is, how you got the number, and why the project needs it. Reviewers check that the numbers match the budget and that every cost ties back to the work described in the proposal. Here’s a narrative for the fictional budget above, one paragraph per category.
Personnel ($76,500). A full-time Program Coordinator (1.0 FTE at $50,000) will recruit, screen, and train 40 volunteer mentors, match them with youth, and run weekly sessions. A half-time Mentor Supervisor (0.5 FTE of a $44,000 salary, or $22,000) will check in with each mentor pair every month and handle any safety concerns. The Executive Director will spend 5 percent of their time ($4,500) on oversight and reporting. Salaries match our current pay scale. Staff will record their time on the project each pay period.
Fringe benefits ($18,360). Fringe is 24 percent of salaries. It covers employer payroll taxes, health insurance, workers’ compensation, and a retirement match. The rate is based on our actual benefit costs in the last fiscal year.
Travel ($1,262). The Program Coordinator will attend one regional mentoring conference to learn current practices for youth safety and mentor retention. Costs are airfare ($450), three nights of lodging ($540), and four days of meals and incidentals ($272). Lodging and meals follow our travel policy, which caps them at the federal per diem rates.
Equipment ($0). No equipment is requested. The two laptops cost $1,100 each, which is below our $5,000 capitalization level, so they are budgeted as supplies.
Supplies ($4,600). Two laptops for program staff ($2,200), activity kits for 40 youth at $45 each ($1,800), and office supplies at $50 a month ($600).
Contractual ($23,500). A third-party evaluator will design the pre- and post-program surveys and write the final evaluation report under a fixed-price contract ($7,500). We will select the evaluator under our written procurement policy. A $12,000 subaward to Eastside Schools Partnership will pay for a part-time site coordinator at three partner schools. The partner will carry out part of the program, so we treat it as a subrecipient. Saturday sessions will use a rented community room at $400 a month for 10 months ($4,000).
Other ($7,100). Background checks for 40 mentors at $35 each ($1,400). Local mileage for staff visiting school sites, 2,000 miles at our policy rate of $0.70 ($1,400). Two mentor training sessions led by an independent trainer at $750 each ($1,500). Transit passes for 40 youth at $70 each, so they can reach Saturday sessions ($2,800). The transit passes are participant support costs.
Indirect costs ($18,678). We do not have a negotiated indirect cost rate. We elect the de minimis rate of 15 percent of modified total direct costs. The base is total direct costs of $131,322, minus space rental and participant support ($6,800), or $124,522. Fifteen percent of that is $18,678.
How do foundations handle indirect costs?
Foundations set their own indirect cost rules. The MacArthur Foundation adds 29 percent of project costs on project grants (MacArthur indirect cost policy). The Ford Foundation pays at least 25 percent on eligible project grants (Ford Foundation). Others cap indirect costs lower, or give general operating support instead, so read each funder’s budget instructions before you fill in the indirect line.
What is the 15% de minimis rate, and what is MTDC?
This section is for federal awards and funds passed through from them.
If you don’t have a current negotiated indirect cost rate, you may charge up to 15 percent of modified total direct costs, or MTDC (2 CFR 200.414(f)). You don’t have to apply for it or justify it.
Where people go wrong is the base. MTDC includes salaries, fringe, travel, supplies, services, and the first $50,000 of each subaward. It leaves out equipment, rent, participant support, tuition remission, scholarships, patient care, capital costs, and any subaward amount over $50,000 (2 CFR 200.1). In the example, 15 percent of all direct costs would be $19,698. The allowed amount is $18,678, because rent and transit passes are left out of the base.
Our post on the de minimis rate vs. a negotiated rate covers when to negotiate instead. For every threshold that changed in 2024, see Uniform Guidance changes.
What makes a budget narrative strong?
The narratives that hold up best do a few plain things. They show the math, writing “40 youth x $45” instead of just “$1,800.” They say where each number came from, whether that’s your pay scale, last year’s actual costs, a written quote, or a published rate. And every number in them matches the spreadsheet and any budget form the funder requires, to the dollar.
They also tie each cost to something in the project description. If a reviewer can’t find the activity a cost pays for, they’ll wonder why it’s in the budget. Finally, they follow the funder’s order and headings, which the funding notice often spells out. Our guide to reading a NOFO shows where to look.
After a federal award is made, the approved budget can still change. Some changes need prior approval and some don’t, which we cover in budget revisions and prior approval.
Frequently asked questions
What should a grant budget include?
Every cost the project needs, grouped by category: personnel, fringe benefits, travel, equipment, supplies, contractual, construction, other, and indirect costs. Show how each amount was calculated, and separate the funder’s share from any match.
What is a budget narrative?
A budget narrative, or budget justification, explains each line of the budget: what it is, how you calculated it, and why the project needs it. It should match the budget spreadsheet exactly.
Can I use this grant budget template in Google Sheets?
Yes. Upload the .xlsx file to Google Drive and open it with Google Sheets. The formulas use basic functions that work in Excel and Google Sheets.
Are laptops equipment or supplies in a federal grant budget?
Usually supplies. Equipment is property that costs at least the lesser of your capitalization level or $10,000 per unit (2 CFR 200.1). A computer below that amount is a supply.
What indirect cost rate can I put in my grant budget?
Whatever the funder’s policy allows. Some foundations publish a rate, such as MacArthur’s 29 percent of project costs or Ford’s 25 percent minimum. For federal awards, use your negotiated rate, or up to 15 percent of modified total direct costs if you don’t have one (2 CFR 200.414(f)).
This article is general information. It is not legal, tax, or accounting advice.
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