Over the last week I have posted part one of the twelve best practices of church finances and also part two.
I hope this series has been helpful and here’s part three.
8. Plan Your Finances
An excellent way to plan your church finances is to develop an annual church budget. This should be standard practice and has many benefits and will help you:
clarify your resource allocation
plan programs and ministries
set faith goals
share with your team the burden of raising and allocating finances
allocate resources to your visions’ priorities
resist the temptation to just repeat last year’s program
I written previously about how to establish a vision centred budget and it’s certainly worth checking out that post if you want to sharpen your budget process.
9. Develop Contentment
Pastors, like all people, compare themselves and their performance with others.
Healthy leaders however, are able to protect their heart from envy and covetousness by managing the juggle of being content with the resources they have while maintaining a dissatisfaction with the status quo.
This is no easy task.
It requires a prayerful and diligent approach to weeding out envy while maintaining a spirit of contentment and yet pursuing the future with faith.
May we all be like Paul who in the latter years of his ministry wrote:
“I have learned the secret of being content in any and every situation, whether well fed or hungry, whether living in plenty or in want.” Philippians 4:12
10. Policies and Procedures
As a good friend of mine says, a policy is a decision already made.
Sound financial policies prevent inefficiencies and uncertainty in your decision-making process. They prevent time wasting repetitive discussions and automate recurring events.
For instance, a policy of automatic salary increases for staff, based on a nation’s wage price index, in a set month each year, help boards avoid labouring over whether or not to increase salaries.
The policy makes the annual hand-wringing redundant and ensures staff salaries keep pace with the cost of living increases.
Likewise, established procedures for financial reporting, receiving offerings, counting money, handling cash, bank transactions and the like will make your financial management efficient as well as protecting your church from fraud.
11. Trained Personnel and Professional Advice
Some movements manage the financial arrangements and procedures for the local church and the church therefore does not need to separately engage trained personnel or professional financial services.
However, if your church does not have access to support services of this nature then it is imperative in today’s climate of complex and ever changing legislation that you use trained and skilled personnel to manage the finances and also access, as needed, professional financial services.
Incompetent management of your finances may lead to illegal and unethical practices and must be stringently avoided.
12. Special Offerings
It’s been my experience that churches respond well to special offerings for specific needs.
It may be an offering for a guest speaker, mission’s project, an unforeseen building maintenance issue or a community crisis need.
While churches should utilise spontaneous special offerings sparingly they should diligently conduct annual faith promise/pledge programs to raise money for buildings and missions.
Unfortunately, such programs are used all too rarely in churches or conducted poorly.
I’ve seen client churches increase their overall giving by over 30% when conducting annual giving programs. However, that’s a topic for another post.
I hope you’ve enjoyed this series of best practices in church finances.