What is your church's approach to its budget?

Discussion in 'Pastoral Ministries' started by scooter, Nov 17, 2004.

  1. scooter

    scooter
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    What approach does your church use when developing an annual budget. In particular, how much of the budget is predicated on the previous year giving versus a "stretch" budget?
     
  2. Pastor J

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    We base our Income on the previous six months.
    Spending is based on the previous year.
    The reason for the income, is we have seen a pattern over the last 10 years that the third and fourth quarter's income are equal to the following years 1st and 2nd quarter. We then typically see an increase in the 3rd and 4th. Therefore, if we budget based on the previous years 3rd & 4th qtr, we are usually over what we expect for income. Expenditures haven't changed significantly over the years. We make minor changes for utilities and fuel
     
  3. Bro. James Reed

    Bro. James Reed
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    We don't have a budget. When we get the bills in we pay them. People give each month whatever they feel they can afford. Sometimes it's more, sometimes it's less. Even without a budget, there is always somehow enough money in the bank each month to cover expenses.

    A few years ago we got down to $98.00 in the bank. We sent out letters to all the members stating such and the Lord provided. That is the lowest the church account has ever been and it was at one of our lowest times, spiritually and physically speaking.

    Very rarely have we ever spent more than $10,000 in a year, and those times we were purchasing major items or refurbishing the church. We're sitting pretty right now though. If only we had a building to spend our money on. One day...
     
  4. Jimmy C

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    We just came through our budget process. We typically start in late August or early September with our personnell team doing reviews in conjunction with the Pastor. Our Stewardship team then begins looking at how the money was spent each of the last three years - budget vs spending vs receipts. We collect budget wish lists from committees and the staff - what do they want to do, how much do they need to do it for. We, as a stewardship team then have the task of looking at our fixed expenses - salaries, building costs and upkeep, insurance (medical as well as P&C) missions. We then look at the ministires our teams want to do in the next year - AWANA, youth, children, music, senior adults, benevolence etc. and try to allocate those precious resources in line with the churches overall mission and goals. We try to work closely with our ministers and the ministry teams as the wants usually are much greater than what the expected income will be. We then come out with a fairly conservative plan and a Praise the Lord plan if giving comes in greater than expected.

    Seems to work for us, we accomplish some great ministries for our Church and our community. If funds are not available for a ministry to do exactly as they want initially, we seem to find a way to get it done.

    Our Church budget is around $450,000, we average about 300 in attendance. Our personnell costs are about 45% of our budget - 3 ft one pt plus 2 pt secretaries
     
  5. Dr. Bob

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    We establish a "firm" budget and "loose" budget. Firm are salaries, missions, etc. Loose are variables like utilities, insurance.

    More than 1/2 of the giving and expense is not in the budget. It is for special needs, speakers, building fund, special missions, etc.
     
  6. Todd

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    I think the key to preparing any budget is to keep you priorities in order. I believe that a church's financial priorities should be as follows:

    1. Payment of all FT/PT staff (not just wages, but making sure all needed benefits are addressed as well)
    2. Missions - how can we truly be the church if we are not willing to prioritize missions? Our church budgets about 20% of our budget for missions causes.
    3. Outreach & Evangelism - Some tie this in with missions, but what I'm talking about here is local missions (door to door, block parties, servanthood evangelism projects, etc.)
    4. Everyday necessities - utilities, insurance, maintenance, custodial costs, etc. The upkeep of God's house and the protection of its ministers/congregants must be a priority.
    5. Other ministries of the church - AWANA's, Youth, Children's, Senior Adults, SS Literature, etc.
    6. Fellowship Expenses - money for Homecoming, Church Picnics, etc.

    I know that these are kind of broad categories, but the whole subject of church budgets is a big one! Not everyone agrees that salaries/benefits needs to come first, but I can promise you that a church that puts anything before the welfare of its leaders will not receive the manifold blessings of God. What's odd is that I've been in churches where the folks wanted to send high percentages of their budget to the Cooperative Program, while starving their Pastor or at least making him live on a poverty level income (which I did for the first two years of my ministry - even qualified for medicaid with a wife and 2 kids). It is hypocritical for a church to say "we are committed to missions" if they are not willing to adequately minister and provide for its leaders.

    This year we had some important decisions to make when budget time came around. We had a full-time minister who was well underpaid, yet we were not making our current budget. Also, we were not doing near enough community missions. Thus, I led them to take money from wherever they needed to in order to increase my staff member's salary and to put some money in the budget for community missions. Unfortunately, we had to cut our gifts to the Cooperative Program by 2% and our gifts to the local association by 1% in order to accomplish that goal. Also, we had to go through our budget with a fine-tooth comb to cut out all the "fluff" that really didn't belong in their to begin with.

    One such "fluff" item was a line item for what the church had historically called "Christmas Treats." Basically it was a little goody-bag that every member (about 125) received at Christmas time that served no purpose at all except to make our folks a little fatter. We cut the treats out, and as you can probably guess, several of our older folks got quite upset. One person even voiced his concern from the floor the evening we went to approve our '04-'05 budget. He asked why the treats were cut out. When he was told we could no longer afford them, he replied, "Well, how can we afford salary increases if we can't even afford Christmas treat bags?" I went home and said, "Honey, isn't it good to know that there are some folks in our church who would rather get Christmas treat bags than to give you and I a cost-of-living raise?" We shared a good laugh. I mention that just to point out that not everyone is where they should be when it comes to being good stewards of God's money - that is THE CHALLENGE of preparing a budget. Just be faithful to God and he will deal with the critics.
     
  7. Salty

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    How will the possible expected high fuel costs effect your budget this year?
     
  8. blackbird

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    Saltcity---we just got our electric bill this past weekend from the power company! We are probably 75 % electric and 25% gas

    Pre Katrina electric for the month

    $550.00

    Post Katrina electric for the following month

    $985.00
     
  9. TomVols

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    As much as possible, I like to use Zero Based budgeting for the ministries. That is, each year, you start with $0. You have to plan your activities and come up with a number relative to your vision for the year. This can always be tweaked up or down during the year. It's a helpful way to get people to dreaming the dreams and seeing the visions for their ministries. That's not to say you don't discard the previous year completely. But I'm no proponent of the typical "Well, the WMU got $500 last year, so let's give 'em $500 this year since they'll do pretty much the same thing."

    Some things are fixed, like utilities, etc. You have to budget with inflation and so forth. Salaries need to be adjusted with COLAs, educational needs, etc.
     
  10. TaterTot

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    This may sound odd, but our church doesnt have a budget. It really threw us for a loop when we first came here, but for some reason it works. Of course we are not a mega church. We do percentage giving and we have set salaries. Everything else, we pay it as it comes. And we always have plenty.
     

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