Cost estimation methods

The Government Accountability Office (GAO) outlines specific ways to estimate project costs. This structured approach helps teams predict expenses and plan budgets correctly.

Key estimation types include:

• Program estimates: Team-based calculations covering the full project life
• Independent estimates: Outside expert reviews to check cost accuracy
• Budget estimates: Focused calculations for upcoming funding needs
• Quick estimates: Basic calculations when limited information is available

Each project phase needs matching estimation approaches. Early planning works with basic estimates, while final approvals need detailed calculations.

Using the right type of estimate matters. Basic estimates help with early decisions, while detailed ones support budget requests. Each estimate type serves different purposes in project planning.^[1]