Podcast Episode #093
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Ministry finance is an area many pastors and church leaders lack adequate training. So today, Jonathan and I discuss five areas of finance of which every minister should be aware.
Some highlights from today’s episode include:
- Churches shouldn’t be focused on money, but without it, there will be no ministry.
- Pastors should at least know the broad parameters of the church budget.
- It’s one thing to know what the budget is. It’s another thing to know if you are meeting budget with receipts.
- Debt (or the lack of it) can radically change how a church can (or cannot) fund ministry with its budget receipts.
- If there’s one financial ratio pastors need to know, it’s the weekly per capita giving.
- Church leaders should stop being so shy and discuss stewardship of money.
The five things to know about church finances are:
- Know the church budget
- Know actual receipts
- Know personnel expenditures
- Know facility costs
- Know weekly per capita giving
Episode Sponsor
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Feedback
If you have a question you would like answered on the show, fill out the form on the podcast page here at ThomRainer.com. If we use your question, you’ll receive a free copy of Autopsy of a Deceased Church.
Resources
- Next: Pastoral Succession That Works
- Seven Reasons Pastors May Need a Virtual Assistant
- EAHelp
- Weekly per capita giving = (Total annual receipts ÷ 52) ÷ average weekly attendance
It is unbelievable that so many seminaries and Bible colleges have NO mandatory church/Christian finance classes for the leaders they are training. Sound financial management is a reflection of Godly living/choices, and lack of it damages ministries and ministers and members. No church member likes the idea of contributing to a church that is paying thousands–tens of thousands sometimes–of dollars in debt, often on a weekly basis (for larger entities in our country). That is money that could/should go to pastoral/staff salaries, ministry efforts and missions. Pastors can’t say things in their church are going well if there is an undercurrent of financial mismanagement behind all the smiles and happy stories. Pastors have to learn how to LEAD and operate from a debt-free mentality if they want to be truly successful in their bodies. If they can’t get that training from their schools of choice, they need to get to Crown Financial Ministries or Dave Ramsey or some other Biblical financial entity so they can get right financial training before they begin to lead others down a wrong path.
Thanks, Louise. Seminaries have to offer so much training. It can be difficult to provide all the theological and practical training they need. I do agree that pastors need to have some type of training in finances before they lead a church.
Yet those same churches sponsor Dave Ramsey’s FPU…
Dr. Rainer (and Jonathan)
It was great meeting you two Sunday night at 12th Street Baptist’s #Revitalize15 Conference.
I made yet another infographic based on this episode of your podcast. Hope you like it. Hope to talk to you two again sometime soon. Here’s the link: http://deknumi.com/rainer-leadership-5-things-know-church-finance/
Phillip Swindall
The Show Notes Guy
http://shownotesguy.com
http://www.deknumi.com
Thanks again, Phillip. It was good to meet you in person.
Would someone care to tell me why many churches will not use their “undesirable” members with finance, banking, and investing expertise to handle the finances/budgeting/investing of the church money? It seems that church leaders with no experience in finance tend to handle the money without taking any advice.
I’m sure that it is a combination of things. The two congregations that I have been a part of enough to know who it is that handles those things did happen to have members with accounting and/or finance backgrounds taking care of such things.
As in all things you would want to make sure that you know and trust the person that you were asking to handle it. The person obviously has to exist within the congregation and be willing to help as well.
I’m sure there are some less than stellar reasons that this doesn’t happen, but there are certainly some valid ones too. If they aren’t there or aren’t willing to help there isn’t much you can do. If you don’t know them well enough to trust them, then that might be as poor in the way of stewardship as having a novice handle it.
There needs to be a careful balance. Finances should be approached in a spiritual manner. E.g. someone may know a lot about investing, but be stingy with raises and fair treatment of staff because they only think from a business perspective.
But the wise man built his house on the rock. If you don’t hold back some money in reserves, you will be left wanting when the air conditioner goes out in the middle of a hot southern summer. Jobs are prized these days and people want to think that their donations aren’t being wasted.
Thanks for making this simple and to the point; this is essential for positive financial health.
ECatherine Pearson, Author- An Attribute A Day
Thank you, Emma.
Does anyone have any information on what the weekly per capita giving is for a healthy church?
Dave –
It depends on the household income of the families in the church. The median annual U.S. household income is $53,000. If your church families have incomes right at the median, the average weekly per capita giving is $29. Healthy per capita giving is $34 and above. You would need to make adjustments on those two numbers depending on the household income of the church members.
This number really surprises me. 10% of $53,000 would be $5,300 or $101/wk. I guess tithing is more rare than I thought.
“Churches shouldn’t be focused on money, but without it, there will be no ministry.” While I understand the principle, this phrase seems to be biblically flawed. I believe we have attached the dollar sign to ministry as if one cannot operate without the other. Perhaps our western culture has conditioned us to think that ministry can only co-exist with a brick and mortar church along with a budget and staff. However, the truth of the matter is that my ability to share Jesus to the person who is next to me in the grocery aisle is not linked to a financial bottom line. I have great concern for a follower of Christ who does not find it possible to make disciples (or minister in the name of Jesus) without having to spend money. Luke 10:7, Acts 3:6, and 1 Corinthians 9:18 are just a few verses that come to mind regarding this issue. This is only my opinion of course.
In a previous church body– congregations were asked to tithe back to the larger church as individuals are giving to the church, they fulfilled a larger mission. In fact, churches were asked to grow it to 20%.
Now that we are no longer in that church body — how much are we to give outside our local church? Some leaders believe everything we do now is mission…so we have lost sight of what we do outside of our church walls.
How can we address this?
I listen to your podcast regularly and find it very helpful. You recently mentioned a resource for church staffing and I cannot remember which podcast it was on. I also cannot find a link to it on your webpage. The resource was mentioned in the context of churches needing to get away from the search committee model. Any help is appreciated.
Dr. Rainer, is there is any research available on differences in church finances between 1st and 3rd world churches, particularly? Just wondering what personnel, facility, and per capita results might be in such contexts. Wondering if, perhaps, their budgets are utilized differently than typical Western 1st world churches.
Mark: I am not familiar with such research.
Most of all, make certain that a policy you have bought is going to
be enough for your death because occasionally, the insurance
coverage benefit that beneficiaries receive
are insufficient for that recovery with the loss along with the expenses laid upon by it.
Beyond a forward thinking door painted red you will also
take advantage of having a simple, consistent line of flowers and plants that outline
the path through the doorway to the street. If you feel that you would rather use
the money you have saved for Christmas on getting the family together and enjoying your time and energy together, you’ll find new methods to pay for that expensive presents which you buy.