5 Indicators that your Church is Financially Overextended

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5 Indicators that your Church is Financially Overextended

Sunday, November 29, 2015

Earlier this fall in a post entitled “Breaking Through your Capacity Lid,” I wrote that financial shortfalls at churches can limit opportunities. I suggested that there are two sides to finances in a church setting. One is building a culture of generosity in your church and then the other is managing that generosity so you position yourself organizationally to say yes to Jesus when He provides clear vision and opportunity

Immature organizations over extend themselves financially and self impose artificial lids as a result.

In a time of year where most churches are finalizing budgets I thought it might be helpful to share some indicators that I’ve observed in churches that are financially overextended.

#1 Your Staff Salaries are not Competitive

If you’re not able to be competitive with your salaries you’re not going to able to attract and keep the talent you’re hoping to have on your team. This is an indicator that you’re financially overreaching somewhere. Not sure how much you should be paying your staff? This post will help.

#2 You’re spending more that 50% of your income of Staff Salaries

As strange as it may seem, if more than 50% of your income is being spent on Staff salaries then you’re staffing costs are beginning to constrict other ministry areas of the church.

#3 Low Cash Reserves

In my work with churches across the country I’ve discovered that if you have less than 8 weeks of undesignated cash reserves available at any given time you probably have too little financial margin to deal with unforeseen obstacles and set backs.

#4 High Debt Levels

Again, in my work with churches through the Unstuck Group I’ve discovered that if your church is carrying more than 2x your annual budget in debt than your debt load is beginning to constrict ministry opportunities.

#5 You Can’t Say Yes to the Opportunity Jesus is Giving You

If you can’t say yes to the vision Jesus has given you then your church is financially overextended. The bottom line is fairly simple. If Jesus has given you a clear vision to lead the church towards then part of your responsibility as a steward of that vision is to build (or enlist others to help you build) a financial strategy that will get you to that vision.

Posted in Leadership

Why People don’t Financially Invest in your Church

Sunday, March 15, 2015

I recently read Not Your Parents’ Offering Plate by Clif Christopher. It’s a quick read that you can get through in one sitting, but it’s full of principles that you’ll come back to over and over again. There are a lot of reasons why people don’t give to churches as much as they used to. This book does a great job of helping to identify those reasons but it also gives pastors and church leaders steps they can take to move things in the right direction. If you’re a church leader and you haven’t read this book…you should. Here are some of the key ideas that stood out to me from my reading:

1. There is more Competition than ever for Charitable Dollars in America

The number of non-profit organizations is increasing every year and as a result competition for charitable dollars is increasing. It’s not that people are less charitable; it’s just that they’re directing it to other places than the church. “Since 2001, giving to religion has shown a rate of growth of 3.6%, while disposable income has increased more than 8%. People have the money and they continue to give. Religion is just no longer their charity of choice.” Church leaders should be asking themselves, “Why?”

2. Nonprofits know Why people Give while Churches just think people should give out of Obedience to the Scriptures

Multiple research studies have shown that there are three key reasons that people give: (1) A belief in the mission of the institution, (2) A high regard for staff leadership, and (3) Fiscal responsibility of the institution.

3. Nonprofits communicate from a position of Strength while Churches communicate from a position of Weakness

Nonprofits rarely, if ever, communicate about finances. What they communicate is stories of life change, real results from the investments that others have made in the nonprofit. Then they ask for more money. Churches don’t talk about results (probably because truth be told not many are actually producing many life changing results) instead they talk about their needs and how they are behind budget or need more volunteers. People with the ability to significantly invest in the Gospel work at your church don’t want to throw good money after bad. They are looking for a return on their investment, and rightly so. The Scriptures teach us that Jesus is too.

4. The Pastor should know who gives what

I know this may sound off to some but listen…(1) It will help them raise more money to fund the work of the Gospel [different people have different gifts and roles to play in the body of Christ] (2) It helps determine if what the church is doing is actually working. [people give to and support what changes their lives] (3) It allows the pastor to say thank you to donors [the church is notorious for not saying thank you]. Most people whose hair stands up at this idea simply don’t want their pastor to know what they give because they’re not being generous and following the Bible’s teachings on finances.

5. Help people Give

Many people want to obey Jesus and be generous with what they have to advance the Kingdom of God through the local church. Unfortunately many of those same people have not used the money that God has given them very well up to this point and they’re not in a position to be generous. Does your church have a plan or resource to help people learn how to manage what God has given them in a God honoring way?

6. The best way to raise money for your church is to DO YOUR JOB!

Peter Drucker wrote, “A business has discharged its task when the customer buys the product, pays for it, and is satisfied with it. Government has discharged its function when its policies are effective. The nonprofit institution neither supplies goods, services, or controls. Its product is neither a pair of shoes nor an effective regulation. Its product is a changed human being. The nonprofit institutions are human change agents. Their ‘product’ is a cured patient, a child that learns, a young man or woman grown into a self-respecting adult; a changed human life altogether.” In other words when your church consistently shows how lives are being changed, when marriages are healed, addicts find freedom, people fall on their knees and follow Jesus – people will support your church.

Posted in Leadership, Spiritual Formation

Top 10 Reasons Churches get Stuck

Wednesday, October 1, 2014

For more than 18 years I’ve been working full-time in a local church setting. The last 13 of those have been in large mega-church and multi-site settings. I’ve had the unique opportunity to work with an incredible team of people at a the Unstuck Group a successful consulting firm specializing in helping churches get unstuck. Over this span of time I’ve seen churches get and stay stuck for all kinds of reasons but there are 10 catalysts for church stuckness that I see come up over and over again. Here they are in no particular order:

1. Insider Focus

Alright so I said these weren’t in any particular order, well that’s mostly true. All except for this one. The most common area where I see churches get stuck is this issue of being insider focused. And it’s rooted in this fundamental question, “What is the church for?” I feel like I write about this topic a lot so I won’t regurgitate it here, just search “insider focus” in the search bar to your right and you’ll get a grocery list of stuff. Bottom line is a majority of churches that are stuck get that way and stay that way because they’re focused on insiders instead of outsiders. They would resist that diagnosis and the label, but they’re practices, language, guest services (or lack thereof), and low number of annual conversations and baptisms tell a different story.

2. Staffing and Structure

There are very common growth barriers that churches hit and get stuck at. A start up church that is setting up and tearing down in rented space, the medium sized church, the megachurch and multisite church aren’t different in size or economies of scale. They are completely different organizations. To get through these barriers and stay past these barriers takes more than momentum it takes changing the staffing and organizational structure of the church, and often times the way the Church Board operates in relationship to the staff. Do you have a staffing plan to get you where you want to go? Do you know what structure best fits your size and strategies?

3. Misalignment

A majority of churches do not organize around a central vision. Many don’t have a clearly stated, meaningful, actionable, and relevant mission statement, vision statement, or organizational values. Or if they do they’re on a piece of paper in a drawer somewhere. It’s the rare church that actually organizes the staffing strategy, budgeting process, ministry calendar, weekend teaching schedule, and communication strategies to synergistically move the whole church in a particular direction. There is no clear plan to move from where they are to where God wants them to be. And a failure to plan is planning to fail.

4. Leadership

I love what Bill Hybles, the Sr. Pastor at Willow Creek has said about leadership, “Everyone gets better when the leader gets better.” A leader can be the lid on a church. In other words, sometimes churches get stuck because the leader is stuck. And it’s one thing to get stuck and a whole other thing to stay stuck. Leaders need to invest in their own leadership gifts and keep growing or they’ll end up being the reason the church gets stuck.

5. Teaching

So I may be about to get some speaking pastors a bit upset. But speaking/preaching is a gift. Not everyone has it. Right? The other truth is not everyone who has a preaching gift has that gift given in the same amount. There are some that are simply great preachers. And guess what. Mediocre teaching, even good solid teaching is a barrier to growth and can lead to stuckness if great teaching isn’t developed or hired. Your church may be stuck because the teaching is stuck.

6. Weekend Experience

A lot of ministry segment leaders aren’t going to like what I’m about to say here, but it’s true, even if you don’t like it. In North America, it’s all about the weekend experience. That total street to seat experience that people have when they come to your church. It’s why your children’s ministry is growing (kids don’t drive themselves to church because they like the crafts that much), it’s why people say things like, “I’m not sure what it is but there is something special going on here.” New people bring new people when the weekend experience is going well. But when it’s stuck, there are no new people.

7. Volunteers

I rarely come across a church that says they have all the volunteers they need. I also rarely come across a church that makes it easy for people to get connected and start volunteering and they view volunteering as a part of the discipleship process. Meaning that when you serve you are actually becoming more like Jesus. In most churches the same people are still doing everything that they’ve always done. And until things change, nothing is going to change.

8. Finances

Many churches are stuck because of finances. Some are over extended in debt with no clear plan to pay it off. Many don’t have and haven’t thought through a clear strategy to engage the givers in their churches. Few have a clear and effective budgeting process, much less know what financial health looks like in a church setting. Many don’t teach about generosity for fear of sounding like all they care about is money. Your church doesn’t have a generous culture and as a result the Kingdom isn’t taking the ground that it should be. If you don’t have a clear plan to manage today’s resources for tomorrow, your church is probably stuck financially.

9. The Past

I commonly see churches that are still enamored with past practices and ministry programs that worked years ago to connect new people to Jesus, but now only serve to keep the committed comfortable. Most churches don’t know how to gracefully put old ministry programs out to pasture. Unfortunately as a result those same churches continue to engage in ministry practices that were successful in the past but keep them from being successful in the future.

10. Next Steps

Many churches haven’t defined next steps for people who are attending their church. What is the next step coming out of a sermon? Now that I’ve attended for the first time as a guest, what do I do now? How do I get into a Bible Study? How do I get involved volunteering? How do I financially contribute? Has your church defined the win regarding spiritual maturity and what you hope people will look like, and have you clearly charted a road map to help them get there?

What are some other reasons you’ve seen churches get stuck? What would you add to the list?

Does this list resonate with you? Is your church stuck in one or more of these areas? It might be worth a conversation with the Unstuck Group, we specialize in helping churches get unstuck!

Photo Credit: tricky (rick harrison) via Compfight cc

Posted in Leadership

5 Characteristics of Generous Churches

Monday, March 3, 2014

Generosity stands in direct opposition to our sin nature. After all most of us don’t wake up thinking about someone else’s day. But what we have to get done today sure has a tendency to consume our thoughts. Fortunately for us we have a generous God. After all “For God so loved the world that he GAVE His only Son,” Jesus gave His life, as a ransom for many, and it is the Holy Spirit who gives spiritual gifts. And God expects his church to reflect his personality and characteristics through becoming generous. To that end, here are 5 characteristics that all generous churches have in common:

Trusted Leadership

People don’t just give to churches that they believe in, they give to churches that they trust. Unfortunately trust is easy for church leaders to break. The 3 most common culprits are ingratitude, the appearance of waste, and duplicity (follow this link to learn more about these).

Teach a Proper Concept

Churches that are generous are consistently taught a proper biblical perspective of generosity. It’s not just mentioned in the occasional sermon or teaching series but it is consistently dripped in week after week.

A Compelling Story

If the story of your church doesn’t compel you and those closest to the core to be generous, it’s not going to compel anyone else to be generous either.

An Engaged Audience

Generous churches meet people where they are and lead people to join in, take personal ownership, and ask the question “What’s my role.”

A Spirit of Faith Not Fear

A spirit of faith drives generous churches. What are you trusting God for that you haven’t trusted Him for before?

Want to know more about building a culture of generosity in your church? Check out this 2-part blog post on “Engaging the Givers in Your Church.”

Posted in Leadership

Top Posts of 2013 #6: “Engaging the Givers in Your Church”

Wednesday, December 25, 2013

Money can be a touchy subject in churches, but it doesn’t have to be. This post includes the first 3 of 6 ideas that I’ve seen be effective in engaging with the givers in churches.

When it comes to engaging major givers in the church a majority pastors feel uncomfortable at best. Many pastors don’t know how to approach the subject and are afraid of saying the wrong thing. While churches have often built elaborate strategies to help people take steps in their spiritual journey and grow in their relationship with Jesus; they usually resort to a “just preach the Word and hope things work out” approach to giving. The problem is hope isn’t a strategy. It doesn’t have to be this way.

Here are first 3 of 6 ideas and principles to keep in mind when engaging the givers in your church.

1. Keep Track of Givers

I’ve heard it said in churches that the pastor shouldn’t know who is giving what. After all, didn’t Jesus say in Matthew 6:3, “When you give to the needy, do not let your left hand know what your right hand is doing.” Well yes He did…but it had more to do with the motive of the giver than anything else. What we have a tendency to forget is Jesus also clearly observed (along with everyone else), and went so far as to point out the actual dollar amount that a widow gave in Mark chapter 12. Now I’m not saying we should parade givers in front of the church to let everyone know what everyone else is giving but someone should know. After all if you don’t know who is giving, then it’s going to be pretty difficult to engage them at any level.

2. Say Thank You

You’d be surprised how far a simple thank you will get you, and sadly how few churches ever say it. A simple way for pastors to engage the givers in their church is to have a list of givers generated each week and write a hand written thank you note. The list can be of the top 10 or 20 givers that week, the top 20% each week, or simply set a dollar amount and each person who gives over that amount gets a note.

3. Give them Inside Information

Another simple way to engage givers at your church is to occasionally do small, intimate, invite only gatherings. Moments like this give you the opportunity to share wins and success stories (stories like this build culture by the way), have personal face-to-face conversations, share vision, and share inside information about steps that are being taken in the near future to accomplish the vision.

Here’s the other 3 ideas from the second part of the post if you’re interested.

Posted in Leadership

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