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One Budgeting Idea when Funds are Scarce

Sometimes funds are scarce. God has created the world abundant with water, trees, blue skies and people we love. Though we have what we need, we don’t have everything. In congregations, this lack is sometimes evident regarding budgets.

Budget realities
The finance team would like to increase the budget for youth ministry, but the cost for the new parking lot is an unpleasant surprise. Or, pledges are down because a major employer left town. There is a widening gap between income and expenses.

Sometimes a congregation’s board does have to decrease the budget. Tough decisions are part of leadership in a faith community, just as they are in a business or a family. It is common for leaders to have difficulty deciding where to make budget cuts and for how much. The discussions about budget cuts can be as unpleasant as the cuts themselves.

Shortened budget
Here’s an idea that might be helpful if you face decreasing income. Try creating a budget for a period less than a year. Create a provisional first quarter budget or establish a half-year budget.

By shortening the time frame of your budget, you leave room for positive, unforeseen adaptations. You also feel the pain of shortfalls incrementally. The downside to this is that your congregation could be delaying a painful decision; pushing the inevitable down the path and hoping someone else doesn’t stumble over it later. However, shortening the timeline of your budget in times of scarcity can be a way for your congregation to be more nimble, to adjust more quickly to difficulties or opportunities.

Congregational story
During a recession, one congregation chose to freeze salaries, but only for the first quarter. The board agreed to revisit the decision after four months. When the time arrived for further consideration, giving had increased almost ten percent. This happened, in part, because the congregants knew about the provisional decision and many members boosted their offering because they wanted to support the hard working staff. As a result, each staff member received a two percent raise.

Resources you can use
When it comes to congregational budgeting, sometimes tried and true resources are among the best. Kennon Callahan’s Effective Church Finances is a practical book for clergy and laity alike.

When money is tight, illustrate the budget situation with more than numbers. Some congregations create narrative budgets, a way to represent income and expenses with graphs, illustrations, and even stories. The article Narrative Budgets, prepared by the Anglican Church of Canada, will provide you with more information.

If you have a specific budgeting question, use our chat function or email us to begin a conversation.

We want to help you move from scarcity to possibility.

web resource
ChurchSalary: A Service of Church Law and Tax
This searchable database for congregations with paid staff contains information on salary levels, retirement, and debt calculators.
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National Association of State Charity Officials (NASCO)
This association helps congregations find state agencies that offer state-specific information about regulations for new congregations and congregations that conduct charitable activities or solicit charitable contributions.
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Growing Small Group Leaders: One Year of Resources for Small Group Coaches
This one-year program uses a variety of tools like instructional handouts and training sessions to coach small group leaders.
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A Pastor's Toolbox 2: More Management Skills for Parish Leadership
This all-encompassing guidebook explains how to manage a parish, addressing issues ranging from job discrimination to adapting to change.
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Sustainable Children's Ministry: From Last-Minute Scrambling to Long-Term Solutions
This resource provides congregations with the tips and tools to build a children's ministry that lasts, drawing upon the experience of two ministry veterans.
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The Four Tendencies: The Indispensable Personality Profiles That Reveal How to Make Your Life Better (and Other People's Lives Better, Too)
This book analyzes four personality types as they relate to why individuals act and why they don't.
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Debtcibel: a Non-technical Sound Book that Teaches the Church How to Spend, When to Spend and Who to Spend It On
Written by a Grammy-winning sound engineer, this resource shows how congregations can achieve excellent sound systems using available resources.
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Bivocational Pastors
This brief video from PBS looks at the challenges and opportunities that arise when the pastor has a second job.
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Setting Wages and Benefits for Church Staff
This five-part guide provides technical and creative insights to manage personnel, budgets and IRS compliance to retain the best possible staff.
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The Power and Promise of a Communications Audit
This article presents a simple, ten-step framework to guide congregations through an annual communications strategy audit.
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10 Ways to Have a Better Conversation
This light-hearted TedTalk is an important reminder of the skills required to have a meaningful, quality conversation with others.
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