Plan Now to Move Forward in 2010

Needless to say, 2009 has been the year the air was left out of the global financial balloon. But there are signs of hope for 2010. Home sales have been up 9 percent in the past two months. Car sales, primarily due to the Cash for Clunkers program, saw a recent boost. An Aug. 13 Wall Street Journal op-ed read, “The Fed is keeping the money pumping … which is an acknowledgement that the recession is all but over.”

What does all of this mean for 2010? Your guess is probably as good as mine. There simply remains too much uncertainty to predict next year’s fortunes (or lack thereof) at this time. Health care reform alone, if not done properly, could seriously dampen our economic future. The effect of the huge deficits our country has incurred are mostly unknown. It is quite possible that 2010 could be a repeat of 2009.

So what do you do about it? I suggest you focus on things you can control and that includes your estimating budget for 2010.  

The Strategy
Now is the time to start preparing your estimating or fair-market value budget for 2010. You may not have all of the data (end-of-year financial statements, latest state unemployment rates and insurance rates, etc.) but that shouldn’t stop you from thinking about the future. You can update your 2010 budget as more current data comes available. It can help you deal with the uncertainty. You can calculate your pricing and what you need to charge for your products, services and labor rates. It will also allow you to analyze what happened and did not happen in 2009. In short, it should boost your confidence and clarify your options if you go about it properly.

The Process
I use an Excel worksheet to prepare budgets for my clients. First, I estimate 2010 revenue for the various divisions of the company. Immediately a problem surfaces because we have little or no idea what is going to happen next year. To deal with this problem, I recommend putting together two budgets – one is a best-case scenario and the other is a worst-case scenario. This allows you to bracket your future even in the midst of much uncertainty. You might call this a hand grenade approach as compared to a sharpshooter one. You don’t know precisely what is going to happen, but it’s probably somewhere between your best- and worst-case scenarios.

What You Get

Conclusion
You may have little control over what the bureaucrats and politicians in Washington do with the big picture. But you certainly can take control of your part of the equation and work the little picture. While there still remains a lot of uncertainty concerning 2010, there is much you can do about it.