Gallup did a poll some years back and found that 33% of households kept a formal budget. The adopting and living by a budget is really the first step for anyone wanting to feel more secure in their finances. The same is true for the church. While the vast majority of churches adopt a budget, few live by that budget. Why is that? Because most of them adopt a bad budget. The budget is usually unrealistic, doesn’t support the church’s vision, and feels like a waste of effort.
In our work with churches, Sheri Meister and I have identified three principles that will change the way you budget.
- Know your bottom line: You’re not the Federal Government so you can’t spend money you don’t have.
- Include your long-term goals: You should be looking forward to more than just surviving the year.
- Tell your story in numbers AND words: Go through the exercise of creating a narrative budget.
The first two will honestly be the most difficult and bring the most resistance. You will have to push forward because your church’s financial future depends on it.
- Budget Bottom Line Calculator: https://www.dakotasumc.org/media/files/old/00/Fin_Ben/Finance/FinAdminRes/Bottom_Line_Calculator.xlsx
- Managing Long-term Funds: https://www.dakotasumc.org/media/files/old/00/Conference/Finance/StewResrces/Managing_Long-Term_Funds.pdf
- Guide to Building Narrative Budget: https://jctaccounting.com/2020/07/24/budgeting-does-your-budget-tell-the-story-of-your-church/
- Narrative Budget Examples: https://centerforfaithandgiving.org/2016/01/narrative-budget-examples/