4) What is the last budget area you would cut in an emergency?
This question often stumps even the best of strategic churches because leadership isn’t static because the answer can change upon circumstances.
Nonetheless, wrestling down the issue of priorities help bring much-needed clarity.
For example, some churches will cut personnel as the very last measure; others want to preserve some monies for ministry to operate. What do you think?
5) What are you doing to increase the income of your church?
I’ve visited churches that talk openly, freely, and boldly about giving and generosity regularly. Others rarely talk about it, and when they do, it’s almost with an air of apology.
The point isn’t about any style or method that is right or wrong, but that you believe you are doing all you can to inspire your congregation to trust God with their finances and contribute to life-changing ministry.
This includes a wide variety of things from cultivating a deep trust for your financial management to practical classes for handling money in a way that honors God.
6) Do you believe you are too frugal or not frugal enough?
How do you base your thinking on frugality? It’s a subjective question. Good stewardship is essential, but there’s a difference between shrewd money management and a spirit of austerity.
7) What debt level are you comfortable with?
Debt is a subject of high debate. No church considers debt something to aspire to, but some churches avoid it like the plague, and others accept it if managed with sound cash margins and income to debt ratios.
8) If you have excess income above the budget needs, how will you allocate these funds?
Margin within a church budget and overall income is similar to momentum to the overall church; it’s pure oxygen.
For example, some churches will allocate all margin income to savings. Other churches reject that idea and believe that all income should be allocated for ministry use.
Most churches, however, are in the middle somewhere with a pre-determined amount of “days cash on hand.” (90 -120 days operating cash is standard.)
The most crucial factor is that you decide in advance about any excess income to budget (margin) and what you will do with it.
A more strategic move is to intentionally build margin into your church budget, even if it’s small to start. One necessary step to accomplish that is to set your next year’s budget based on last year’s income.
9) Who has primary decision-making authority for major financial decisions?
Similar to question # 3 (Who is responsible for income?) knowing who makes what financial decisions is critical to smooth and unified operations. In the case of this question, I’ve narrowed it to major financial decisions.
10) In what specific ways would your community or city see you as a generous church?
This question is meant to be straight-forward and practical. What ministries of your church are making a substantial impact in your community?
The word “substantial” isn’t necessarily about the amount of money. For example, you may give a modest amount to a food co-op, but it makes a big difference in your community.
11) Do you have a sufficient number of competent financial advisors?
Some pastors and church leaders are gifted when it comes to money matters, and many are not. (It’s not my gifting!)
If you don’t have spiritual leaders within your church who understand both church ministry and sound business principles, don’t hesitate to get wisdom and advice from trusted financial advisors outside your church.
12) Who is coaching your staff on how to manage their budgets?
Your staff is no doubt good at what they do, but don’t assume that they all know how to design and manage a budget. Make sure they have the much-needed training.
These questions will not remove all the financial complexities from your ministry, but they will help you solve them in a more team-oriented, productive, and morale-building way.
This article about church finances originally appeared here.
