It doesn’t occur often, but occasionally I run across an article, webinar, or blog post with content so good I am eager to share it with you and expand upon it. Such is the case with a recent post from Tim Cool at eSpace, called “If It’s Phase-able, It’s Feasible.” I’ve known Tim for almost 15 years now, and have high respect for the work he does for ministries around the country.
Tim and I share a common frustration – seeing a set of well-intentioned church building plans sitting on a desk in the office that will never be built. Why? Because the church simply cannot afford to build what was designed.
How does this happen and, more importantly, what can you do to avoid making these same mistakes that lead to a similarly expensive and ineffective result? Let’s get to that in a moment. But first, some important background information.
HOW IT USED TO BE
Twenty-five years ago or more, it was fairly common that a church with a need to take on a construction project would do a three-year capital campaign to support it. As a result, the church building was built, being funded by the campaign, and the church incurred little to no long-term debt. Results in capital campaigns in those days averaged returns of approximately two times the annual income of the church.
Today, results in capital campaigns continue to return approximately two times the annual income of the church. However, that same church building project may require multiple campaigns and/or significant long-term debt to fund the project.
So what has changed? We raise the same multiple of income today as we did then. Church buildings built then were regularly funded with one campaign with little to no long-term debt, but today multiple campaigns and/or long term debt are required to build.
As valued clients, ministry partners, and friends, I’m excited to share some great news with you today. Generis will be making an announcement later this week, but because I appreciate our relationship I wanted you to hear from me first.
Late last year, we initiated a conversation with the parent company of RSI Church Solutions, that resulted in a consolidation of both teams under the name and leadership of Generis. These are two of the most respected names in church stewardship and generosity joining forces because we believe we can serve churches better together. I value our relationship and wanted you to hear this exciting news from me first.
Here are a few of the key benefits for you and your ministry:
- We will have a hand in creating new data tools for effective on-going analysis of giving metrics that will help your ministry more effectively nurture a growing culture of generosity. I am most excited by this aspect of this announcement.
- One of our values is collaborative strength. With a larger team and a deeper bench, our expertise and passion to innovate will only increase.
- With Generis and RSI combined, more churches can apply proven strategies shaped to fit their needs to make their God-given visions a reality.
Additional information will be forthcoming through the official corporate announcement and subsequent press release. In the meantime, If you have questions or would like to speak with me directly, please reach out. I would value the conversation!
phone: 800.233.0561 x243
Working with churches in the realm of generosity, I see it quite often – common mistakes in the church budget planning process. I see these with regularity, which makes me wonder if perhaps you too have committed one or more of the three most common mistakes in your church budget planning process and not realized it. (It’s ok – not only will I share with you what these three mistakes are, I will also share some ideas on how to avoid or fix them!)
The three mistakes listed below come straight from a recent webinar on the subject. You will want to pull it up soon to hear Jim Sheppard, one of our Principal Partners at Generis, and William Vanderbloemen of Vanderbloemen Search Group discuss these common mistakes made in the church budget planning process.
MISTAKE #1 – Operational Expense Mistakes
Regardless of church size and mission focus, there are three common line item “categories” in every church budget: people (personnel) expenses, building/facility expenses, and everything else (ministry, missions, etc.). What problems do we typically see in this area?
Churches often let the people and building/facility expense categories grow too large, at the expense of ministry and missions. The most common mistakes here are:
- staffing expenses that have grown larger than they should for a specific church’s model of ministry.
- facility costs, usually including over-sized mortgage management, on a space that is too large or was a bit too aggressive financially to construct.
If you have too much going to one or both of these categories, little is left to actually fund the mission of your ministry! For example, if you have 50% of your budget going to personnel expenses, and 40% to building/facility expenses, that only leaves 10% for everything else. And that 10% is supposed to fund all of your ministries and missions while staying within budget.)
So what portion of a church’s total budget should these categories hold? That depends largely on your individual church, but here are some benchmarks to consider:
The standard rule that has floated for years is to keep personnel expenses between 45-52% of total budget. But that isn’t appropriate for every church. It’s too much for some, and perhaps not enough for others. It depends on how you do ministry, and what resources you provide.
- Are you a staff-driven church, or one that is more congregationally driven, leveraging a large volunteer pool?
- What kinds of programming do you offer? A church that offers an on-site counseling center, daycare, or school might have larger personnel budgets than those that don’t have those programs on site.
- A church that outsources some roles might have a lower total personnel expense. I am seeing more and more the outsourcing of several areas previously handled by church staff, including communications (print design, website creation and management, video production of church announcements, etc.) and finance (accounting, payroll, etc.).
- What is too much or too little? Vanderbloemen shared that a personnel budget running lower than 40% or higher than 65% would both be numbers that might indicate need for some study and review.
Did you know 31% of all online giving occurs in the month of December? 18% of total giving happens in December. And, even more shocking is this statistic – 12% of all giving occurs during the last three days of the year!
Here’s a snippet from Network for Good’s Digital Giving Index infographic recapping 2015 giving. (view infographic online)
Many of your givers often want to make their year-end gift on the very last Sunday of the year. This year that Sunday falls on December 25 – Christmas Day – while your people may likely be out of town enjoying celebrations with relatives and friends. More significant - I see many churches in my area not even planning to have worship services on Christmas Day this year. (If you’re doing an online or streaming service on Christmas Day, make sure your offering moment is well prepared!)
I anticipate there will be several who will drive to your church office during the last week of the year to give that last gift in time to include it in this year’s tax deductions. (I remember doing this more than once before the convenience of online giving.)
What should you be doing to prepare for this?
I want to share a very important task with you today. This is an idea that, if you implement it by December 20, will increase giving in your church during the last two weeks of the year.
We know a large percentage of giving happens right at the end of the year. One third of all charitable giving happens in the last 3 months of the year, and 18% comes in the month of December. Also 31% of all ONLINE giving occurs in the month of December! Do I have your attention?
So here’s a way to receive a bigger slice of the pie. I’ll get right to the point of this post, and then let you read on for the full story: prepare and send an 11-month giving statement by December 20 (earlier if possible).
I’m not like most people sitting in the seats of your worship center during the weekend. I monitor giving closely. My wife and I set giving goals every year, and we strive to reach them. Giving is a priority for us.
I recall a few years back when I thought we were right on track toward our giving goal. At the end of December, I ran my usual giving report from my personal finance software. (I said I’m unusual, so here’s more proof: I actually run giving reports in my personal finance software!)
Expecting to see my giving at a particular place, I was surprised, (shocked actually) that where I THOUGHT we were for the year, and where we ACTUALLY were, didn’t match. We were significantly behind. How could that have happened? It didn’t matter – it had happened.
Fortunately it was December 30, so I was able to run a check up to the church office, and our goal was attained. (I am now in the practice of running my giving report more frequently. I don’t like last minute surprises!)
While engaged with churches across the country, I get the opportunity to work with some really outstanding people and organizations. Sometimes these people have resources and expertise I suspect my readers might value.
And that’s the case with Don Corder, Founder of The Provisum Group - an organization driven to assist pastors and leadership teams in the effective day-to-day management of the church. Don and I met while I was engaged with his church in a recent generosity initiative. His church is also a Provisum Group client, and they speak very highly of the assistance they receive from their partnership.
I had a recent conversation with Don to get a bit more information about the book and his work with churches. Here’s what he had to say:
Q: You recently wrote a book called Minding His Business - what prompted you to write it?
A: I wrote Minding His Business for one reason: To make pastors’ and ministry leaders’ lives easier by sharing 35 years of experience conducting business in and out of the Church. If you think about it, the people God calls to be pastors are usually creative, relational lovers of people. That person is more like an artist than an accountant. Yet, sometimes pastors are expected to have expertise in accounting, finance, marketing, web development and more. They are sometimes expected to be pastors and CEO’s. It does not happen in all churches but it does happen in many. It is a recipe for burn-out and failure.
Minding His Business is a business primer written specifically for churches and faith based charities, but written to the right side of the brain. The book is divided into 40 short, easy to read chapters and the content is written in parable and anecdote. On its pages you will read of church after church facing similar challenges, what was done to meet the challenge, and how it turned out.
Q: Tell me about the book and how it helps “make life easier” for those in ministry.
A: After years of helping churches all over the United States with their business administration, I kept seeing the same problems and challenges happening over and over again. I began to realize that there are very few “new” problems in the Church. There are just “new” people having the same “old” problems, usually for similar reasons and requiring similar solutions.
Count on it: your givers and potential givers are not all alike. In fact, they break down into at least four kinds of givers.
The Generis team has just released a new resource designed to help pastors in churches across the country increase giving – with all four types of givers.
This new, 26-page e-book will share with you the differences between each of the different types of givers, as well as what you can do to bridge the gap between funding and vision.
This new resource will:
- help you identify the different givers in your ministry
- give best practices to engage different types of givers
- encourage and equip your discipleship efforts
- and much more!
The more you recognize different types of givers and meet them at their level of need and expectation, the stronger your culture of generosity can become.
This guide, available to you now as a free download, was designed to equip you with the knowledge Generis has gained through 3,000+ successful capital campaigns. This e-book provides you with a practical tool to help fund your church into its next phase of ministry expansion.
Looking for more resources like this one? Check my resources page for more great material!
Looking for more information or personal assistance? Let me know. I’d love to help you and your church fund its God-sized vision!
I did something a couple years ago that was super helpful to me and to the churches I serve. I asked for feedback. I asked for input. I asked the church leaders in the trenches day in and day out what they needed most in the realm of generosity.
That feedback led to several practical blog posts about creating a culture of generosity, preaching on generosity, and how to talk about it outside the offering moment. (Great stuff – thank you for requesting it!)
It also led to the creation of several e-books about giving technology, communicating to impact giving, and the importance of recurring giving.
And now it’s time to circle back and ask again:
What do you need, want, and desire most to help you and your team impact the generosity of your people to fulfill the God-sized vision of your church?
As is always my focus, I want to make sure I’m providing you what you need – not just what I think you need. So I would love to give you an opportunity to share with me exactly how I can best help you.
Please take five minutes to answer a few quick questions for me. I’ve put together a short survey (yes, it’s short – I promise!) to allow a quick and easy way to speak into what’s coming in the near future.
Now is the time. The floor is yours.
I look forward to hearing what you have to say.
TAKE THE SURVEY
Generosity has reached record-setting levels, making 2015 “America’s most generous year ever,” according to Giving USA in a report they published just last week.
An estimated $373.25 billion in charitable giving came from individuals, estates, foundations, and corporations last year, growing donations by 4.1% over the previous year. Giving USA marks this as a new record for the second year in a row.
As for donations categorized as religious giving, numbers were up 2.7% over the previous year, accounting for $119.30 billion in gifts and 32% of total giving.
That’s the good news.
This small percentage of growth, however, shows us religious giving is losing ground when compared to other categories of giving that are growing at a higher rate.
What’s Coming Next?
Looking at the 2016 predictions, The Atlas of Giving is calling this year a potentially “perfect storm” for charitable giving.
Your people have questions. And they’re not just about the next children’s ministry event or where to take their canned goods for the food pantry. They have questions about giving – big questions about why they should give and what happens to their money when they give.
As their pastor, it’s your responsibility to make sure they have answers to these questions. This is an opportunity for you to make sure your people are being guided and encouraged on their generosity journey, all while making sure your God-sized vision for ministry is being funded.
So here are 5 questions your people are likely asking, based on 5 things people need to know before they will give. (Trust me – most of your people are asking at least one of these questions!)
1. CAN I TRUST YOU?
The news is unfortunately frequent with stories of improper use of charitable gifts – the Wounded Warriors Project being the most recent example. People want to give where they know their gifts will be stewarded well. Be transparent. Work to build integrity and trust in your personal leadership, and in those in positions of leadership. Communicate well, and often.
Follow through. Do what you say you are going to do. Don’t ask people to do something you yourself are not doing. (Be an example.) People give to those they can believe in and trust. How have you shown your church is trustworthy in the last six months?
2. WHAT’S THE VISION?
Givers give when the mission of the organization aligns with their passions. Most people aren’t as motivated by need; they give to vision. It’s not about the money, but what the money will accomplish. It’s not about facilities, but the ministry the facilities allow.