Church budget preparation season is upon us. There may be a spring in your step as you dream about all the possibilities. Or some serious slumping shoulders as you think about the late night meetings and attempts to fund more initiatives than there are resources available.
Your mind is swirling. There will be topics you dream about discussing because you can finally fix a lingering challenge. Then there will be those cuts you dread because you cannot fund everything.
Let me name some common challenges that often go unnoticed, then present an alternate approach that will help your team go down a smoother path and end up in a better place.
When it comes to budget planning, churches often follow a sequence something like this:
- They reflect upon the current year and project their budget spending for the future year. The number usually rises which puts pressure on the team on day one.
- Staff will present their dream figure to fund their program fully.
- The church administrator gathers the requests and does the number crunching.
- Then everyone shows up at a meeting to figure out what makes the cut and what doesn’t. In other words, who wins and who loses. Sometimes the conversations are just too hard so the budget expands beyond giving limits. Other times, everyone leaves exhausted, deflated, or jealous of the ministry that appears to have won the lottery.
This may be a little extreme, but for many, it is not far off. Some have avoided the back-and-forth challenge by simply assigning budget figures or giving the same spending increase across the board. However, let’s zoom out toward a broader process that may solve more than one challenge for you – it will clarify budget priorities, unite your team, and speed up ministry development.
As you’ll see, a lot of the leg work goes in before you even start allocating funds.
Step 1 – Begin With Vision
Highlight how the vision has been pushed forward this year. Pull together a recap of the year-to-date in terms of ministry progress and success. Show the team where God is changing lives. Let them see how their hard work is paying off. It may also serve as a hint to where God is going in the future.
Every church does not possess every ministry, and every ministry in the church is not functioning at the same level. Name the places where fruit is growing. This can be an indicator of where your church should continue to invest, or even increase investment. You can direct a strategic plan towards God’s activity and build excitement over what’s to come.
The best starting point when entering the budget-building process is to unify the team around the vision.
The best starting point when entering the budget-building process is to unify the team around the vision.
Step 2 – Create A Church-Wide Ministry Goal For The Next Year
This goal should be tied to both the previous year’s success and long-term projected direction. You cannot accomplish everything in one year, but you can make significant progress in selected areas. These areas need to be named and funded.
You can also name initiatives for coming years. This will help your team see that every ministry has an important place in the future, even if what they want for their area isn’t the immediate next step. Understanding their role in the longer-term plan will get them rallied around the focused goal of the coming year.
Step 3 – Block The Church Calendar For The Next Year
You only have 52 weeks in a year, so make the most of them. First, set your church-wide ministry goal as the top priority. You want to maximize your resources of time, space, volunteers, and dollars to accomplish what’s most important. Then, name your regular programming and must-do events.
Finally, only add items to the calendar that either create value for your visionary direction or keep your base strong. Limit the number of extra activities you create that do not add value to future direction. You can only use time, money, and space once so be wise to help you get to your dreams quicker. If it doesn’t add to the future vision or keep ongoing ministry strong, it probably doesn’t need to happen.
You can only use time, money, and space once so be wise to help you get to your dreams quicker.
Step 4 – Plan Your Ministry Investment Fund (aka, Budget)
Once a staff member has planned his or her budget without visionary direction it becomes a challenge to redirect. At that point, the odds of hurt feelings and discouragement are pretty high. That’s why you should not be talking about how to allocate dollars until you’ve clearly set specific goals and what it will take to accomplish them. It enables you to ask, “Does this further the goal, and if not, should it be funded?”
The unfortunate truth is most churches are over-funding ministries that had a better past than future, but few are courageous enough to address the situation head-on. Building your budget around a unified vision and clear ministry goals will establish a new normal – one where the vision can direct the resources rather than the staff.
The unfortunate truth is most churches are over-funding ministries that had a better past than future, but few are courageous enough to address the situation head-on.
While there are plenty of obstacles to be navigated simply by suggesting a new approach, there is a bigger theological issue that church leaders need to ponder. What are the spiritual implications of misspending God’s resources? If the tithe is holy when it is given, it is also holy when it is spent. We have a pretty big responsibility to handle this planning season well.
If the tithe is holy when it is given, it is also holy when it is spent.
I have been at the table leading processes like this and watched staff members willingly surrender funds for the greater good. I have heard statements like, “If we are going there, then I am all in.” I have also witnessed programming-heavy staff start to redirect their events and ministry offerings to better serve the larger vision. Conversations like these are quite the contrast to delivering news that “we could not fund your entire request.”
Tweaking your process allows for new conversations to happen that can affect many other areas of leadership. Churches can exist year after year without a clearly articulated vision with aligned goals. The conversation of strategy being redesigned or the calendar being optimized never occurs. But when process guides the way, there are many tangential development conversations that are naturally navigated. You’ll find greater clarity in not only how money should be allocated, but how your ministry should be focused.
Maybe you are not ready to completely re-engineer your budget process. You can probably do one thing to make it better or test out a new idea. Why not take one aspect and give it a test? Then, in the years ahead you can keep adding elements that work in your context to lift your slumping shoulders and put a spring in your step during budget planning season.
Want to discuss some of these topics with generosity expert, Todd McMichen? Request a meeting and gain invaluable insights and personalized guidance to inspire generosity within your congregation.