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One of the most important steps a self-managed condominium corporation can take to control expenses and moderate condo fees is to create an operating plan or budget. Ongoing property maintenance depends on adequate funding, and it is important to maintain or grow your condo equity and property values. An Operating Budget and a multi year Reserve Plan/Budget will provide a financial guideline for the future.
A couple of months prior to your fiscal year end is a good time to give thought to beginning the budget process. A review of the year’s income and expenses to-date, with a projection of next year’s expenses, will permit you to formulate a budget plan for the upcoming year. In addition, a longer term review of the adequacy of your Reserve Fund balance should also be a part of the process.
It is important to note that budgeting is the best way to insure that future monthly contributions are both reasonable and adequate. No owner likes unhappy surprises that involve large condo fee increases.
