Math Is Money.. Budgets Equal Chaos
Monday, August 8, 2016
by: Annette Ahumada, Scripps Health

Section: News

With most property manager’s, our budget impacts us daily. I find myself with calculations in my head when a major leak occurs or the chiller goes down. Cost of the repairs, if insurance will cover, and the loss of business that most tenants will be calling to file a claim for are all calculations that are running in my mind. In the end, I still remain calm and confident in my decisions of the financial impacts on my budget.

I was not always like this when it came to numbers. As a teenager, math was not my best subject. It was honestly intimidating. Until one day, my grandfather taught me a concept that I still use today; “Math Is Money”. My grandfather explained that every aspect of math, truly impacts some sort of dollar and cents. It is how you look at it and understand the ripple effect of it to appreciate the concept. He simplified it for me, and he was right. We all care about money. Money is easier to understand because it’s personal. Your livelihood impacts your day to day life.  Keeping this concept in my mind while attending the Budget & Accounting BOMA class, provided me the opportunity to truly see the influence finance has with property management. Terminology that was defined in class had also been used by my finance director when I was an assistant, and it began to make sense. I was more confident on holding conversations with him and with our tenants when lease renewal came around or delinquent’s letters went out. Once my position changed and my portfolio grew, I had to become more creative. I began to see my budgets as a parameter and my PI’s (performance improvement) or cost savings as my goals. I truly believe the Budget & Accounting class should be taken for those who are new to property management. This class will provide a stronger foundation on finances for those APM or assistants, allowing for an extra pair of eyes for cost savings.

As we are all aware, the economy is changing. We all have current budgets due, and there is always a chance that we will be told that budgets need to be cut by 27% or budgets are due in 72 hours as clients and boards would like to review sooner to make necessary adjustments.  Most property managers do not panic, because we are problem solvers, forward thinkers, and we have the necessary training and tools to handle most situations. Luckily we also have a network of support through BOMA, colleagues to bounce ideas off, and others that have had a similar situation that can share their experience. As most property managers strive in chaos, it’s what we do and what we are good at. As there is no true conclusion to this article, as budgets are like an endless running loop with no conclusion but all chaos.