Falling into Financial Strength
As a child, I loved everything about the Autumn Season. I grew up in the northeast in the heart of the Berkshires, so each fall, the hillsides surrounding my town would explode with various shades of yellow, orange, and red. In the first week of October, my small town would host a parade to celebrate this season. The following week, people from around the area gathered to hike Mount Greylock, the tallest mountain in Massachusetts. My favorite part of this festivity was my family’s annual tradition of visiting the Apple Barn, where we purchased my favorite apples and ate warm apple cider donuts. While I no longer live on the East Coast, I still love this season. Over the years, I have learned to celebrate it with my favorite fall flavors — apple, cinnamon, and pumpkin spice- and I have even learned how to make apple cider donuts.
It is relatively easy to know when fall has arrived in the northwest. The morning air is crisp, carrying a faint smell of wood fireplaces being brought back to life. The leaves begin to turn shades of yellow and red, and Starbucks brings back the Pumpkin Spice Latte. Unfortunately, knowing when a church is headed for financial trouble is not as easy.
Over the last decade, I have served or supervised churches at various stages of financial difficulty. Some were easy to spot as their attendance and giving had dropped over the previous 10 years. Another church depended on its endowments for missional work but could not fund its operating budget. While a different congregation had rented out all its building space to stay afloat, it left them with no place to hold educational or missional programming. Just as many congregations were also struggling financially, but you couldn’t tell as easily.
In order to determine whether your church is financially strong, consider these signs of financial health:
Transparency: A financially strong congregation does not shy away from discussing money. They speak openly and honestly about where they are struggling and what they need to ease the financial burden. They hold stewardship drives that clearly and directly name what funding the congregation needs to balance the budget. Additionally, they prepare an annual budget, distribute financial statements to committees and ministry teams, and review their books annually.
Financial Controls: Financially strong churches adhere to best practices regarding the handling of funds and comply with internal financial controls recommended for non-profits. They also have a financial policy that outlines how they handle various funds and which gifts they will accept.
Payment of Staff: Congregations that are strong in this area seek to pay their staff equitably for their work, including annual cost-of-living adjustments. They also regularly complete a compensation survey (i.e., researching the cost to hire a new staff person and survey other congregations about what they pay their staff) to ensure they are paying market rates for each position.
Givers: A faith community is financially strong if the pastor and/or staff members are not among the top ten givers to the congregation. It is also important for financial strength that no single program is dependent on any one or a few members for its continued operation.
If your church is financially strong, there are many faithful options available to you when you are considering where God is calling your congregation. Depending on your faith community’s strength in Spiritual/Emotional, People, and Building, your options may include merger, revitalization, yoking with another congregation, relocating or redeveloping your property or faithful completion. If you are not financially strong, there are several ways to increase your financial strength, including being transparent about your financial needs, adhering to internal controls, understanding your giving pattern, and diversifying your income streams.
Just as fall will eventually give way to winter, and winter will give way to spring. Similarly, a congregation’s financial health will change over time. Intentionally focusing on the skills that lead a congregation toward financial strength will help a church navigate every season of its life.
Curious about your congregation’s strengths? For a more in-depth analysis of your Spiritual/Emotional, People, Financial, and Building resources, download our Congregational Self-Assessment or—if you are a regional leader—the Judicatory Leaders’ Assessment.
