Managing Church Finances | 7 Must-Know Tips

As a member of church leadership, you can often find yourself tasked with things you didn’t sign up for when you first birthed the idea of starting your place of worship. However, running a church is so much more than just preaching a few times a week and running worship groups. Perhaps one of the most complicated parts of being a church leader is managing church finances. 

Finances are difficult to manage for the best of us, but when your sole income source is donations, offerings, and tithes, it adds a whole new level. 

Whether you’re new to financial management or just new to this kind of financial management, you shouldn’t worry. This article will cover all the basics you need to know to keep your church up and running: 

#1: Establish a Budget

Your budget is one of the single most important aspects of managing church finances. By establishing both how much money you expect to receive in a given period of time and how much you expect to spend in that same period, you can effectively create a budget to guide you and make sure your church is heading in the right direction.   

Not only that but knowing how much you need to make within a certain length of time will allow you to take measures to hit that amount when you’re running behind. For example, you might host a bake sale or a donation drive. 

How to get your budget in order

Whether you’re building a new church or taking over an old one, you should get with your other church leaders and decide on a central accounting system before you start trying to budget (such as QuickBooks by Intuit). After all, you don’t want to set the financial tone with paper records and tons of files. Instead, it would help if you aimed for a central system that can keep everything well-organized. 

Moreover, once you have your accounting system in place, produce by establishing your yearly goals on expenditures. Your duty for the rest of the year will then be to remain under those goals. 

The typical breakdown for church expenses looks something like this: 

● 38% toward wages.

● 12% toward building maintenance and repair.

● 8% for utilities.

● 7% for office expenses.

This equates to a total of 65%. The remaining 35% should be stored in the church’s bank account and used only for expenses that aren’t covered by the budget, emergencies, or budgetary overages. 

Once these goals are in place, you can actively manage church finances and know that you’re operating within your means. 

managing church finances

#2: Actively Work to Increase your Income

As previously stated, most churches run solely off the generosity of their members. Because of this, working to raise the number of donations and offerings you receive is paramount to managing church finances. 

To do this, first, work to understand how much you’re receiving per week compared to your attendance. Based on several different analyses, most churches average about $20 per adult per week. This means that if your average weekly attendance is 50 people, your church should be bringing in $1,000 each week. 

If you notice your attendance steadily growing while your donations are remaining the same or even decreasing, it could be that your new members aren’t familiar with your church’s system. You may consider holding a fundraiser or discussing with your members the importance of giving and elaborating to them how vital their generosity is to the church’s health.  

Some other ways of increasing your weekly tithes are as follows:

● Make it a point to share specific financial goals with your members. Each time a goal is hit, let them know and celebrate!

● Plan sermons that emphasize generosity. 

● Create an email list or newsletter that your members can opt-in to and share your successes and goals there.

● Make it easy for members to donate anytime they have the thought by creating an online portal to donate using their debit card. 

These are just a few ideas, but you get the picture!

#3: Create a Rainy-Day Fund

Sometimes, the best method of managing church finances involves going further than leaving those extra dollars sitting in your church’s account. After all, if you see that money in there, you may decide to purchase some luxuries that aren’t needed because you have the extra funding. 

That’s completely fine (after all, no one lives solely off necessities, we all indulge occasionally), but you should make sure you have money set aside in case something unpredictable happens. 

Our recommendation is to create a Rainy-Day fund that you treat as an expense—every week or month; you save a certain amount in the fund. This will help you with both future unexpected expenditures and to maintain your peace of mind. 

#4: Ensure Your Staff Has the Church’s Best Interests in Mind

The unfortunate reality of our current world is that theft is a prevalent issue. As a church, your leadership should always remain above these temptations (1 Tim. 3:2; Titus 1:6-7). You want to make sure you’re keeping it away from your organization at all costs. There are a few ways you can do this: 

Require two people to handle cash at all times

From taking your daily offerings to the bank to withdrawing from the church’s account, you should require that two people are present at all times. You may also consider telling the bank to require double signatures at all times; this way, no one can withdraw without someone else knowing. 

It may be inconvenient, but it will protect you in the long run. 

Limit Access to Bank Info

Speaking of bank accounts, you should be limiting who has access to them. For example, regular volunteers shouldn’t be allowed to handle the cash alone, depositing it in the bank, or managing church finances in general. 

Instead, we recommend reserving account access to only a select few trusted members. 

#5: Create a Plan to Avoid or Eliminate Debt

Debt can be a disaster to keep up with, especially when you’re a church organization running off donations. Because of this, creating a plan to avoid or eliminate debt can be a lifesaver. 

Here are a few things you can do to establish a plan that will better help you in managing church finances: 

● Identify current debt and try to pay more than the minimum payment. This will help you eliminate your debt faster and avoid additional interest. 

● Set goals within your congregation and keep them updated on their progress. 

● Be honest and open with your members about the financial state of the church. If you’re struggling, don’t be afraid to let them know. They’d rather help than watch the church fail. 

We know that sometimes it’s difficult to admit that you’re struggling, but in this case, doing so could get you the help you need. 

#6: Understand How Today’s Choices Affect Tomorrow’s Reality

Sometimes, it may be tempting to spring for that brand new carpeting or a few extra chandeliers. After all, you want your church to look as beautiful as it feels—and there’s nothing wrong with that. However, the financial decisions you make today could be the reason you are over your budget tomorrow. 

When making major financial decisions that are more than a hundred dollars, try not to decide immediately. Instead, make it a point to wait a minimum of one week so that you have time to get over the excitement of your idea and really take time to think things through. 

#7: Don’t Be Afraid to Take Out a Church Loan

If despite your effort in managing church finances, you’re still struggling financially, a church loan may be exactly what you need. However, figuring out where to go, what to look for in a loan, or who to trust can be difficult. 

That’s why Griffin Church Loans is more than happy to help. 

At Griffin Church Loans, we make it a point to serve you and your church above all else. More than anyone, we want to see you succeed. 

We have experts specializing in church loans, and from 1999 to 2021, we have closed over $1.5 Billion in loans to churches to date. 

If you’re ready to take the next step toward your church’s financial future, you can read more about our process or apply for a loan today

We’d love to help.

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