Archive for June, 2008

Tips for Daily Church Finances

Monday, June 9th, 2008

While the main focus of Church Financing is to assist churches looking to build or make improvements to their facilities, I thought it would be a good idea to post some information that pertains to the general, daily finances of the church. It’s important for a church to understand these basic aspects and to develop a solid financial foundation to accommodate regular day to day activities before attempting to finance a new project.

Check out all of the tips and facts below from an article by the North Indiana Conference of the United Methodist Church:

  1. Typical churches require a budget 1,000 times their average weekly worship attendance in order to fully fund their ministries. Or, their weekly gifts are at least $20 times the average weekly worship attendance.
  2. Total compensation for staff may be 50-60% of a small church’s total budget but 40-45% in a larger church.
  3. Between 5 and 10% of the total budget should be spent on outreach and evangelism.
  4. No more than 20-25% of a church’s total expenditures should be for debt retirement.
  5. It’s not wise to give more than 35% of your budget to missions; it will begin to limit your future ministry and growth.
  6. It’s best to raise 50% of funds needed for building projects before beginning construction (25% if land is already paid for).
  7. Having an offering drop box in a church’s lobby can increase donations.
  8. Sometimes the cost for a special part of the vision, such as hiring an additional staff person, can be seen as a mission outreach and thus, at least for a few years, be funded out of the church’s mission budget. Or in the case of a building expansion, the funds could come through a capital campaign.
  9. Expect additional program staff’s salaries to be paid through new giving units within 6-18 months.
  10. A church usually will raise far more money in a capital campaign if it uses a professional fund raising company.
  11. A church’s pledge drive should always come before the budget is formulated