Find what is hiding in your budget
The expiration date of my current business credit card is at the end of the year, and well before Thanksgiving I was receiving notifications from all sorts of services that the card on file was nearing its expiration. My new business credit card arrived around Thanksgiving, and I blocked out time to update the credit card in all the different services that are automatically charged.
It turns out the list of all the places the info needs to be updated is long and it got me questioning if I needed each of those recurring payments. It was time for me to do a full assessment of how I was spending my hard-earned revenue. It turns out it is also the time of year when I build the budget and projections for the business, so I was able to integrate the two activities.
As we enter the new year, building budgets and planning revenue goals and projections is a common practice. (If you do not do this activity at any point in the year, let’s talk).
In many cases, business owners create budgets around general numbers, determining what percentage of expenses they want or need to allocate to each category. The budget becomes a general sum, say $200 per month on reading subscriptions or $500 per month on software tools. Using previous spending as a means of determining how much to spend in the coming year, without digging in or allocating specific amounts where possible, can hide waste.
This year, as you go through that process, dig deeper and review where all the money has been going and decide if you want to continue. As you build your budget, here are two areas to go deep to see if there are opportunities to cut or reallocate for more effective spending.
Look at Every Recurring Charge
Don't just budget "$200 for subscriptions." Pull up your credit card statements from the past 12 months and find every single recurring charge. (Many credit card companies already flag those for you on their site.) Identify every software tool, every membership, every publication, every service that auto-renews.
When I did this exercise, I knew of all the subscriptions and services I was paying for. However, I did find an extra license for one tool and an add-on for another tool that was no longer necessary.
Going line by line on each subscription is not about being cheap. It is about intentionally spending on the things that help you run your business better.
Break Down Your Category Totals
When a category involves a variety of activities, look at all the different subcategories. Marketing tends to be one of the biggest line items. You budget $3,000 per month for marketing, and it includes social media, networking events, sponsorships, content creation, website work, and who knows what else. When was the last time you evaluated the value of each activity or how much business it generates?
Take the time to review your 2025 data (include 2024 if you can as both years were quite different in their economic environments). For marketing, identify which activities generate referrals, leads and actual revenue. If you have a transaction fee category, look at all the different sources of those fees. Are there tools that are costing more to collect revenue than others?
Breaking down where you want to prioritize spending in the categories that have different subcategories allows you to focus more time and money on activities that will generate the most value.
The budget you build now will guide your decisions for the next twelve months. Make sure it is based on reality, not just on what you have spent historically but also on where you want to prioritize spending for the greatest return. 2026 can be better than 2025, but only if you do the work now to learn from what happened, plan for what might happen, and optimize how you are allocating your most precious resources.