Smart Church Finances

A Pastor's Guide to Budgets, Spreadsheets, and Other Things You Didn't Learn in Seminary

George M. Hillman Jr., John Reece

• Publisher: Lexham Press
• Year: 2020
• ISBN:
  9781683593751
• Topic: Theology & Religion
• Subtopic: Christian Church

What can the Church learn from the business world? You're a leader of a ministry, nonprofit, or church. You trained to be a faithful counselor, preacher, interpreter of God's Word—so why do you find yourself spending so much energy on administration tasks that threaten to drain your time, energy, and joy?Look to this book for the coaching you needed, yesterday. Written from years of ministry and business experience, Business for Ministry is built on a solid foundation of business principles but—unlike many business books—in a straightforward style that anyone can grasp. You'll learn how to:

• Communicate vision and strategize with a team
• Steward resources well (yes, including budgeting)
• Prioritize goals, wisely make decisions, and evaluate outcomes based on vision and data
• Leverage the existing talents of men and women at your church, many of whom don't fit in "traditional" ministry roles

This field guide to building a holistic, sustainable system for your church will both help you address the business needs of your church and free your leaders to serve, fully and joyfully.

CHAPTER 1

Stewardship and Joy

In the parable of the talents, Jesus illustrated some clear business principles relevant to today’s church:

For it will be like a man going on a journey, who called his servants and entrusted to them his property. To one he gave five talents, to another two, to another one, to each according to his ability. Then he went away. He who had received the five talents went at once and traded with them, and he made five talents more. So also he who had the two talents made two talents more. But he who had received the one talent went and dug in the ground and hid his master’s money.

Now after a long time the master of those servants came and settled accounts with them. And he who had received the five talents came forward, bringing five talents more, saying, “Master, you delivered to me five talents; here, I have made five talents more.” His master said to him, “Well done, good and faithful servant. You have been faithful over a little; I will set you over much. Enter into the joy of your master.” And he also who had the two talents came forward, saying, “Master, you delivered to me two talents; here, I have made two talents more.” His master said to him, “Well done, good and faithful servant. You have been faithful over a little; I will set you over much. Enter into the joy of your master.”

He also who had received the one talent came forward, saying, “Master, I knew you to be a hard man, reaping where you did not sow, and gathering where you scattered no seed, so I was afraid, and I went and hid your talent in the ground. Here, you have what is yours.” But his master answered him, “You wicked and slothful servant! You knew that I reap where I have not sown and gather where I scattered no seed? Then you ought to have invested my money with the bankers, and at my coming I should have received what was my own with interest. So take the talent from him and give it to him who has the ten talents. For to everyone who has will more be given, and he will have an abundance. But from the one who has not, even what he has will be taken away. And cast the worthless servant into the outer darkness. In that place there will be weeping and gnashing of teeth.”

Matthew 25:14–30

In this parable, the servants are given five, two, and one talent(s) respectively. While we no longer use the term “talent” (talantŏn in Greek) to communicate monetary value, these servants were given significant amounts of money to invest. A talent is equal to anywhere from sixty to eighty pounds of precious metal. If it was silver, that would equal sixteen years of wages an average person would earn. If it was gold, it would equal 493 years of wages. We are talking about substantial amounts of money these three servants were put in charge of. Implied in the story is Jesus wanted the servants to conduct business. Jesus did not want the servants to sit idly by. Furthermore, the servants were rewarded by how they conducted their business.

CHURCHES DO BUSINESS

The activities of business are so much a part of life that you cannot escape making transactions. You conduct business every time you buy groceries, put gas in your car, purchase your latte at the local coffee shop, pay your rent, download the latest phone app, or deposit your paycheck. Business in its simplest form is the exchange of money and time for goods and services. Business is about making wise choices and beneficial exchanges in your life and for the organizations you are a part of. This is also true for your church.

Business activities are unavoidable in your church. While the visible work of your church is being done to fulfill its mission and vision, the business activities are happening “behind the scenes” to make sure the visible work of your church is accomplished. This may include:

•Paying the rent or the mortgage for the building your church meets in

•Paying the salaries of your church staff

•Buying the supplies for all of the various ministry areas

•Providing adequate insurance coverage

•Collecting the weekly offering donations

•Sending out contribution statements to donors

•Having the technology you need

•Organizing mission trips and retreats

•Providing transportation

•Feeding participants and volunteer leaders

•Having all of the correct legal documentation

•Recruiting and training the right people in the right serving positions

•Conducting your governing board meetings

•Defining workflows and procedures

These are all business activities that are required to run things in your church. While some business concepts in this book may sound foreign to you if you are not familiar with business lingo, this book will translate the business principles and activities we share directly into a useable approach for pastors and ministry leaders like you. We combine our experiences in business and ministry to bring you methods and tools you can use in running the business of your church.

Here is a case study (modeled after a real-life situation both of us as authors are very familiar with) that helps us explore the business side of church ministry.

BUSINESS CHALLENGES FOR A CHURCH

Sam and Joy met in college, got married right after graduation, and headed off to seminary to prepare for ministry. During their time in seminary, both Sam and Joy became increasingly burdened about the New England region of the United States. After a vision trip to that region of the country, Sam and Joy began a relationship with a church planting organization focused on New England. A prayer team of their friends and family formed to cover them in prayer, and the sending organization started coaching them in fundraising and practical church planting skills. Everyone who knew Sam and Joy knew they had the God-given abilities, values, and passions needed to plant a church, and all of them were confident (in the Lord) that Sam and Joy would succeed.

With May graduation behind them, Sam and Joy, along with their newborn daughter, packed up their belongings and drove to New England to start their new ministry. The church planting organization helped Sam and Joy identify other core launch team members already in the area, and very quickly they formed a nucleus of like-minded believers passionate for the gospel in their community. Modeled after Acts 9:2, where the believers in Jesus were called followers of “the Way,” this core team decided to call their new church plant The Way Church.

Sam took plenty of courses in seminary on how to study his Bible, do solid theology, and preach, but very early on in the church plant process, Sam and Joy discovered there were many things they did not know or were not prepared for. Just consider some of the real-life business decisions a church plant has to think through even from the very beginning.

STARTUP CHALLENGES

When they moved to their new town, Sam, Joy, and the launch team found a really cool Art Deco movie theater on the town square that was converted into a local performing arts center. They thought this would be the perfect retro venue for their Easter Sunday preview service next spring, and as their first church home. While they thought it would be a simple thing to just rent the theater, very soon they realized there was much more involved.

The performing arts society who ran the theater had a lengthy contractual agreement for the young church plant to sign. Besides all of the “lawyer” language in the contract (which was hard for the team to understand), the contract asked about the church’s nonprofit status with the state. The team quickly realized they had not filed the proper paperwork with the state to register as a nonprofit in the first place. In all of their excitement to launch a church and share the gospel, they had not even thought about this mundane (but legally important) step.*

The contract for the theater also asked for a significant security deposit (which the young church plant did not have) and for proof of liability insurance (again, which the young church plant did not have). And once they actually walked into the theater, the team began thinking about how to set up a baby nursery in an old movie theater that did not have a nursery. They would have to buy baby beds, rocking chairs, toys, room dividers, carpets, etc. And what about safety procedures for checking the children in and out of the nursery? And then once they bought all of these items for the nursery and had all of the processes in place, where would they store the stuff during the week since the theater had no storage space available?

All of this would take money. No one had thought to set up a local banking account in the church’s name yet. While there had been some donations from family and friends (which Sam and Joy kept in their personal checking account), the tracking of the funds had been pretty haphazard, honestly. The team realized there would need to be a budget and accounting procedures in place to handle both donations to the church and payments out from the church.

CASH CHALLENGES

In the early days of The Way Church, money was extremely tight. Family and friends had given personally to Sam and Joy to help make this church plant a reality. These monthly donations, along with some meager savings Sam and Joy had scrounged together while at seminary, would help keep them afloat for a season, but there was little money for much else in this church plant. While the rest of the launch team members were putting in long hours to make the church plant a reality, none of them drew a paycheck from the church. Most of the team members had full-time jobs, and the young families (on the launch team as well as the new church members) gave whatever extra cash they had to the offering plate to make ends meet. Sometimes at the end of the month, a special offering was needed just to pay an unexpected bill. The Lord always provided, but every month was a faith journey for these new leaders.

GROWTH CHALLENGES

Fast forward one year to the church’s second Easter. The Way Church was now celebrating its first birthday. God’s hand had been most definitely on the work of Sam, Joy, and the launch team. A core group of consistent members were now calling The Way Church their church home. Some of these church members were mature believers who had recently moved to the community. But more exciting were the new believers who had come to faith in Christ and were now growing in their faith at The Way Church. Now with these new Christians in their midst, the church was needing a discipleship pathway for spiritual growth.

Everyone serving at The Way Church was super busy in these early days. It took a team of people every Sunday morning to unload the trailers with all of the nursery stuff and the sound equipment for the worship team. And unfortunately, it was usually the same faithful volunteers who also loaded up the trailers on Sunday afternoons to take them back to the storage shed for the week. And yes, it was usually the same faithful volunteers who were teaching the children’s Sunday school classes, singing on the worship team, serving on the communion team, and parking the cars. While everyone loved the ministry taking place at The Way Church, the leadership team had not established a good process for mobilizing more volunteers for ministry needs.

There was also a demand for new ministries as the church grew. For example, there were now some families coming who had teenagers. Was it time to start a youth ministry? And if so, who was going to lead the youth ministry—the same volunteers who were already stretched too thin? What should the model for the youth ministry be? And how was the church going to pay for another ministry? As a church plant, the donations were just barely covering the essentials. And a bigger question was how would the church decide what to prioritize, since it couldn’t do everything a larger church could? Just like the youth ministry need, there were other internal needs that were starting to pop up.

Also, as Sam, ...