Getting Started with Your Finances
If a club is to be successful, it needs to be on a solid financial footing – it needs to budget carefully and be able to generate income.
Here are some pointers to get you started:
Appoint a treasurer
The treasurer is the person in the club that has the main responsibility for looking after club finances.
They don’t need to be a money expert. But it does need to be someone who is organised and can keep a record of money coming in and going out of the club to ensure it can cover running costs.
A club is often not able to open a bank account until it has a treasurer so this needs to be one of your first tasks.
Open a bank account
We recommend that the club opens a bank account in the club name. This is often a requirement if you are applying for grants so it’s best to get this done at the start.
Visit your bank or building society and have a look at the range of accounts available. They should be able to advise what type of account will work best for you.
An online banking service is quick and convenient, especially as most banks now offer a service where two people can sign off on online payments.
Bank accounts usually require two signatures on any cheques - one of which must be that of the club treasurer. This provides a level of security for the club’s finances as one person alone cannot look after all the pennies!
It’s time to do a spot of maths. Work out how much it will cost to set up and pay any running costs.
So think about:
- Facility Hire
- Insurance cover
- Governing Body Fees
- Coaching fees (if you are paying people)
- Marketing costs (posters, website costs, flyers…)
Some of these will be one off or annual costs while others will be more regular.
- If you know how many members you are likely to have, you can work out a cost per person.
So let’s say, facility hire is £45 a week for 2 x 1hr sessions. You have 15 members. The minimum you would need to charge is £1.50 a session to cover cost of facility hire. Work out any other costs and overheads and make sure your fees cover these plus an amount to cover any other risks - for example, you may want to charge a little more in case people don’t turn up every week or so that you can generate a surplus for any unexpected costs such as replacement of kit or a large scale development project.
- Many clubs now set up direct debits or standing orders to save collecting fees at every session. Your bank can advise you further.
- It is also good practice - and sometimes a requirement - that members have to be members of the governing body too. This is normally an annual payment and the cost is set by the governing body. Some clubs add a membership fee of their own on top of the payment to help raise funds.
- You will want to make fees as affordable as possible. But remember, the cost to members has to cover running costs otherwise the club may slide into debt and eventually fold.
- Be open with members about how much it costs to run the club. They are more likely to understand that the fees are reasonable.
Need more money?
Your club may want to run projects but the cost cannot be covered by membership fees alone. If you are looking for extra funds, think about:
- Could you generate income from your facility?
- Are you eligible to apply for grants?
- Are you able to source sponsorship?
- Could you undertake commercial activity like selling kit or refreshments?
- Can your club organise fundraising events and activities? There is guidance available at The Institute of Fundraising.
- Register your club at easyfundraising.org.uk and encourage your members to visit the site before they do any online shopping. Picking from almost 3000 retailers such as John Lewis and Amazon, they can shop as usual while your club can earn money from the retailer.
Crowdfunding is the practice of funding a project or venture by raising monetary contributions from a large number of people, today often performed via internet-mediated registries, but the concept can also be executed through mail-order subscriptions, benefit events, and other methods. Crowdfunding is a form of alternative finance, which has emerged outside of the traditional financial system.
If you would like finance training, Business Wales offer online courses. You need to register before taking a look at the Managing Your Finances module which covers cash flow, budgeting, accounts, profit and loss and balance statements.