With many churches facing financial challenges in the midst of an economic recession, I’ve been curious to know if there are some common themes that are compounding the problems. Since Casey is working with churches across the country to help solve their financial issues, I asked him to outline the most common mistakes he has identified. Here’s what he shared:
1. Lack of clarity
“When I ask a church leader where they want to be twelve months from now financially, few can tell me. When I ask a church leader what their annual operational budget is, they look at their executive pastor or bookkeeper and say, ‘How much did we bring in last week?’ The lack of financial education among pastors is VERY scary to me.
“With this lack of understanding about dollars, few churches we meet with plan more than a few months in advance. Well, it isn’t rocket science to figure out that if you don’t plan, you probably will not accomplish! We suggest every church develop a whiteboard session with their key team and write no more than four financial goals for the year. The goal has to be twitterable (140 characters of less) and has to have a date and amount connected to it. When its clear, it works!”
2. Living on faith more than wisdom
“Unfortunately, leaders run their church finances like they run their personal finances. Most pastors I meet with believe God will just ‘provide’ and there is no need to plan more than paycheck to paycheck. This is not biblical. The Bible is full of examples of people making faith moves but it was usually a few times in their life, not everyday or weekend! The Scripture has way more examples about being diligent and wise with our money than living with faith in a miracle all the time. We suggest living in reality with budgeting, spending and debt. Base your budget on past REAL trends of income and expense more than HOPING we take in more this year. God is into miracles, but he is also into margin.”
3. Too many staff
“Tony, you are the expert on this, but I see so many churches that hire people to do what volunteers could easily do. Overhead walks on two feet! One of the quickest ways to limit the ministry God has for you is to just hire a bunch of people to do administrative work that volunteers can do. The litmus test for staff (especially early on) should be can they build volunteer teams and raise up leaders?”
4. Low accountability
“Staff will spend the churches money DRY unless you have a plan they can follow. Churches that have a low accountability spending system spend more than churches that are on top of it. We suggest developing a monthly allotment that each person can spend in each budget category. If they go over, take it out of their paycheck (just kidding). You have to monitor spending or it will get out of control.”
Casey Graham is the co-founder of The Change Group, one of my new ministry partners that helps churches with their finances. If you’d like to learn more about how his team helps churches address these financial mistakes, fill out this online form.
So those are Casey’s top four mistakes? Do you agree? What would you add to the list?
