How to Keep from Running a Deficit in Your Church

So, how’s your church budget doing this year? It’s March now, which means it’s also a good time to look at church finances. You can probably already tell what kind of start the church is off too. Granted, January and February are not strong months for offerings, historically. However, you can take this into account and make some adjustments if you need to. If you’re off to a better year than anticipated, praise God. If you aren’t, praise God anyway, and make a small tweak or two now. It will save you greater pain down the road.

Church budgeting isn’t the same as personal budgeting for a variety of reasons. One of them is the unexpected happens on the opposite side of the ledger. In personal budgeting, I can generally expect a paycheck every pay period. The variables are my expenses–an unforeseen medical bill, a surprise car repair, etc. Church budgeting has surprises on both side of the ledger. You can get caught by a big facility related expense, etc. and (more commonly) get caught off-guard on the “offerings” side of things.

Tell me if this sounds familiar. Your church steps out on faith with some ministry plans that will require increased offerings–say 5-7% above last year’s offerings. They don’t materialize. Not to be deterred, your church runs a slight deficit through about July, until someone on the Board throws the flag–calling for something to be done about the deficit. They want to cut. Other elders want to challenge the church to give more generously. The preacher doesn’t want to do either–because both mean significant pain for him personally. This process goes on for a few months until the church is at a crisis point. So, a special offering is called for the purpose of making up the deficit. Usually, the church still comes up a little short and a deficit is left at year’s end. So, some new ambitious ministry plans are put out there that will require increased offerings of 5-7%, they don’t materialize…

Then, the process gets repeated the next year.

Let me suggest a more disciplined process: Don’t stop dreaming, but budget a bit a more conservatively, then make small adjustments every 2 months based on data–not dreams. This doesn’t mean you can’t run any deficit ever. It’s normal to run some deficit during the first part of the year, because the back half is always better than the first in terms of offerings. I’m suggesting we not let that deficit run too deep. I’m suggesting you run a smaller deficit and avoid the loss of credibility that comes from always needing a bailout.

There’s a difference between asking the church to give generously at year’s end to make up a $5,000 gap and needing to ask in July for $50,000 and then again in December for $40,000. Managing God’s money that way hurts your church long-term by eroding credibility and training the church to give to need rather than vision, and crisis instead of love for Christ.

Most of a church’s financial problems are self-inflicted. One of our biggest mistakes is not adjusting down before we absolutely have to adjust.

Take for instance, the “sequester.” Regardless of whether you think the sequester was a good idea, the real reason it happened wasn’t just because of President Obama or the Republicans. It happened because for years, no one did anything about the deficit to the point something had to be done. When you’re in crisis, your options are limited and anxiety rules the day–not logic or the Spirit. Political interests may have caused gridlock when it came to finding another solution. But, the problem wasn’t political. It was perennial, self-inflicted financial decay.

Rather than run that play in your church, look at how you’re doing this year, and make small tweaks now. How small? 2% might be about right. If you feel that’s too steep, go with 1%. Right now, someone is thinking, “if we lower the “weekly need” number, people might give less.” Yes. But, that tells you a lot about how your church has been formed spiritually. In addition, if you really want people to give less, mismanage the budget year after year :)

You might consider telling the church what you’re doing in the name of stewardship–and part of biblical stewardship is responsible spending. However, also remind them stewardship’s essence in the Bible is generosity.

Tomorrow’s post will deal specifically with choosing what to cut. For now, I hope you’ll keep your mind open to the idea now, not in August.

Question: Does your church make small tweaks throughout the year, or does do you run deficits most of the year hoping to make it up at the end?

 

Author: Tim Spivey

Dr. Tim Spivey is Lead Planter of New Vintage Church in San Diego, California. He is the author of numerous articles and one book, "Jesus: The Powerful Servant." A sought after speaker for events, Tim also serves as Adjunct Professor of Religion at Pepperdine University. Tim serves as a church consultant, and his writings are featured on ChurchLeaders.com, Church Executive magazine, Faith Village, Sermon Central, and Giving Rocket.

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