“Money isn’t the most important thing in life, but it does affect everything that is important.” Robert Kiyosaki
Regardless of what size church you are a part of, the one thing you can’t ignore is the stewardship of the finances. You are responsible for other people’s money that has freely given it to you to manage and stretch to its greatest extent. The goal is to be as effective as possible in reaching the community you serve, and money is an important factor to consider.
This means that your budget and financial management is one of the most important things you do as a pastor in the organizational health of the church.
Let me be clear, though. It isn’t the most important thing you do. Not more important than preaching, discipling, training volunteers, and caring for people’s needs. However, as Kiyosaki said, it makes all those important things more effective.
Budgeting for the church is challenging though since we are based on a volunteer giving model. We don’t offer products and services that we transactionally trade for people’s hard-earned money.
Instead, we teach a biblical model of giving as an act of obedience to God, as a discipline for ourselves, and as a service to those we are trying to reach. We teach that giving is a choice of sacrifice as an expression of worship to God our provider.
This means the annual cash flow can fluctuate considerably in some cases, leaving us as pastors trying to navigate the uncertainties.
So, here are some guidelines for building an effective budget:
- Events pay for themselves
- Spiritual Growth Gets a High Percentage
- Budgeting isn’t Personal
- Impose Accountability
Introduction
As an Executive Pastor, budgeting is always an interesting season for me. I personally love the process because it allows us to look forward to the next year, plan for what is possible, and dream about what God is going to do through us as a church staff and community.
I get it, though, not everyone enjoys it. For some, it is like nails on a chalkboard, while others get lost in the numbers and planning. Despite how we individually feel about building a budget, it is imperative.
I have had my experiences with churches who have been against building budgets on a philosophical, and even theological, perspective. Some felt it was unspiritual to confine God to a financial plan and that we should rely on faith for the finances to come in.
Unfortunately, some of those churches have been unable to pay their bills, unable to pay their payroll, unable to take advantage of opportunities when they arose, and even had to close their doors because of their mismanagement of the money.
As pastors, we have to find an intersection between good financial stewardship and walking by faith. We have to understand how to be responsible while also taking some chances and following God’s leading.
The way I look at a budget is that it is a baseline to work from. It is a living document that is set before the next year, revisited continuously, and adjusted as needed. It is accountability for the frivolous spender, it is commitment to the penny pincher, and it is permission for the uncertain steward. It is not a prison for the movement of the Holy Spirit or a roadblock to our ability to follow him.
In reality, as ministry leaders, we are stewards of people’s giving. God has entrusted money to those in our faith communities believing they will give sacrificially. In turn, they have entrusted their finances to us to use it for the advancement of God’s Kingdom and the maintenance of their faith community.
We have all seen ministry leaders who have used the giving of their congregations to create lavish lifestyles and numerous perks for themselves personally. Though I don’t think it is necessary for ministry leaders to live like paupers, I do think we walk a fine line between purchasing what we need and purchasing little perks that we just want.
We walk a fine line when it comes to church finances, which is why I want to give some guidelines to help us build better budgets that effectively support the ministries of the church as well as safeguard us from the temptation and mismanagement that has occurred in churches.
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Guideline #1: Events Pay For Themselves
This is good for all departments, but encourage your Kids and Students pastors in particular who tend to be heavily event-driven.
Depending on the size of your budget and the number of events you have in a year, you could eat up your budget in a hurry and not leave room for curriculum, culture development pieces, and other elements that directly impact the spiritual development of those in your faith community.
I have a simple rule for the staff pastors I have led…events pay for themselves.
Now, occasionally there is an exception to the rule, like an outreach event. However, if your events are focused on regular attendees, such as conventions, camps, back-to-school activity, retreats, or luncheons, then charge a fee that covers the cost.
By doing this, you will preserve your budget money, increase the perceived value of the events, and will create a built-in metric to help decide if it is a viable event or not.
Guideline #2: High Percentage Is Designated To Spiritual Growth
Referring to our first guideline, events can be high energy, high cost, and low spiritual growth. That’s okay, as long as a high percentage of your budget isn’t going towards high-energy events with little to no spiritual growth impact.
If events are paying for themselves, then you can channel a higher percentage of your budget towards spiritual development. Investing in a small group system, in curriculum, in service opportunities, and in volunteer training will increase the spiritual depth of your faith community. This investment in spiritual depth will increase volunteerism, giving, congregant satisfaction, and relational connections.
By investing your budget into spiritual growth, you are investing in church health. Over time, the Flywheel Effect will kick in and your increased spiritual health will result in greater spiritual disciplines such as giving. Then multiplication will just happen with little effort.
Guideline #3: Budgeting Isn’t Personal
As ministry leaders, we are bought in completely. This is great and can help us be successful, but when our buy-in becomes personal, then it can create landmines for us to step on. The budgeting process can create a landmine if we are not aware of the challenges.
At some point in the budget process, a finance committee or church board is going to review the budget and make cuts. When this happens, there is the temptation for staff members, including us, to take things personally.
Now, I am always an advocate for staff members being willing to step up and fight for their ministries. It shows passion, buy-in, and a desire to make things as good as possible. However, it is also important for each team member to remember they are a team first.
I once heard Alton Garrison say, “Be loyal to the team you are on before the team you lead.” I share this with my teams when budgeting season comes along. It is important for us all to remember that, even though we are passionate about our ministries, the whole of the church comes first and we need to embrace the full mission our church is on.
When we remember we are stewards of other people’s money, we roll when the cuts come. We don’t hold our budgets with closed fists creating tension, frustration, and silos. We recognize our role is to advocate for ministry initiatives, for particular events and activities, and for ministry innovation that congregants often don’t see the value in. At the same time, we also recognize we need accountability as well. Our priority is to promote unity and effectiveness. When we don’t approach the budget process personally, then we will be able to navigate the tricky waters with a clear mind and a strategic heart.
Guidelines #4: Impose Accountability
We have all heard of the stories of improper use of finances by a ministry leader. The temptation for us is to shake our heads, question the moral depth of that ministry leader, and then resolve to never allow that to happen to us.
However, if we don’t take intentional steps toward having accountability, we either won’t have it or it will be forced on us. We need to take the initiative to impose accountability on ourselves. We should feel uneasy about having complete access to the finances when no one else has the same level of access as us. If there is an area in the budget that you are the only one who sees it (staff salaries, other accounts besides the general fund, missions giving, etc.), then you are flirting with compromise.
Even when our hearts are in the right place and we make the best decisions we can, they may not be the best decisions at all. We need others to see everything and advise us in the management of our ministry finances. By imposing accountability ourselves, we increase our defenses against moral compromise, we increase the loyalty of those who follow us, and we increase the effective usage of the budget.
The primary drawback is that you may lose complete control, but, as Lord Acton said, absolute power corrupts absolutely.
Conclusion
These guidelines are here to provide you with parameters for your budgeting process. The goal is to steward what we are entrusted with well.
By building a sound budget you will increase your ministry effectiveness, stretch your budget further, and safeguard yourself from compromise.
