Building Your Annual Church Budget in a Post-Pandemic World
Before we get too far, I completely understand that the pandemic is officially not over. I realize that our world is still in a state of confusion and no one really seems to know what’s going on or what will happen next. It unfortunately seems that we’re at a point where we’ve never been more divided as a country. Regardless of your stance on the current issues, I’m sure we can all agree that things are a little bit chaotic right now.
You’re probably experiencing that chaos first hand as you try to continue to lead your local church and meet the needs of people in your congregation and community in these unprecedented times.
If you’re like most pastors, you may feel like you’re hanging on by just a thin thread, but rest assured, your efforts are for a far greater purpose than we see right now.
It's Time to Build Your Annual Church Budget
As we head into a new year (can you believe it?!), it’s time that we discuss your church’s budget for the upcoming calendar year.
In 2021, the finances and financial accounts of many churches were unpredictable to say the least. Your church might have experienced this. And because of this unpredictability, you might be thinking that you have no idea how to budget for 2022 based off the current year.
Here are some considerations to help you start planning for your 2022 church budget.
Assess the Current State of Your Church Budget
In our Church Budget Blueprint Course, one of the first steps we discuss for planning your budget is that you need to know where you are. If you’re looking for directions on your phone, it will always ask you to choose a starting location. It’s virtually impossible to give directions if you don’t know the starting point.
The same is true for budgeting. Because your budget is a plan, it is really hard to chart a course if you don’t know where you’re starting from.
How To Review Your CURRENT Church Budget
Begin by taking a look at this year’s financial reports. While the church finances may have been all over the place, you should be able to get some information about the current financial status of your church.
What do your financial numbers tell you? Has church giving increased, decreased or stayed roughly the same versus last year?
There are a lot of churches that look vastly different than they did in February of 2020. After months of virtual church services, many congregations are seeing fewer attendees than they did before everything started. At the same time, there are many churches that are seeing new people that they didn’t have prior to the pandemic. By being forced to do ministry differently, many churches are seeing people that may not have otherwise stepped foot inside a church and that is a good thing.
In order to know where to go from here, though, you’ll need to get honest about your current situation.
What questions do you need to ask?
What does your attendance currently look like? Are you seeing the same number of regular attenders each week? Are you seeing the same number of visitors? If you are still offering virtual services, how many people tune into these services regularly?
What does church giving look like? Do you know your giving per unit and giving per capita? These two metrics will help assess the health of your church giving.
Along with church giving, what is your average weekly and monthly amount? How do those compare to previous years?
Without a good understanding of these numbers, it will be difficult to accurately plan for the future.
To be honest, the last 6-9 months are probably a good indicator for your new reality moving forward. While uncertainty still exists, we must realize that many people have established a new normal for themselves, and decided how they will live and what level of socialization they are comfortable with, at least for the foreseeable future. The people showing up on Sunday mornings and those participating in giving right now are probably the ones you can count on moving forward.
How to Draft a New Church Budget
Now that you know your numbers, and have some understanding of where you are, we can begin to formulate a plan to move forward into 2022.
As you develop your budget, take the numbers you found from the past 6-9 months and use those as a baseline for projected giving trend moving forward. Then take a look at your spending and expenses over that same time period. Is your spending in check or are you spending more than you are bringing in? Do you need to make some adjustments?
Finally, think through what you want for your church in the year ahead. What vision do you have for your congregation? Does your projected spending and budget allocations help move you towards that vision?
Be prepared to drastically change your budget if necessary. Don’t allow yourself to get so tied in how things were done in the past that you neglect an opportunity to pivot. One thing pastors and church leaders have learned over the past few months is how lean some ministries can be. We’ve also had the opportunity to get clear and prioritize what really matters. Perhaps there are some areas of ministry that you don’t need to fund or prioritize moving forward.
Once you’ve thought through these important questions, formulate a church budget plan that will guide you and your church in 2022.
Can you adjust your budget Mid-year?
What if you need help with your church budget?
If church financial planning or developing your church budget is causing you stress, don’t hesitate to ask for help and guidance!
One thing that became evident during the pandemic is that pastors need pastors. Let me suggest two opportunities for you as we head full speed into the new year.
First, if you know you need help, schedule a free discovery call with us. We will talk with you about church financial support options for your church and help you decide what is best for your church. Getting financial help is way more affordable than you think!
Second, consider joining our FB group for pastors we call Oasis. Be connected with other pastors who know what you’re experiencing and are open to real discussions about the joys and hassles of being a pastor. You can be real with us without fear of losing your “pastor card.”
Regardless of your next steps, be sure to take the time now to plan for 2022. How you plan now will determine the trajectory of ministry going into the new year. One thing is certain, time will continue moving forward. It’s up to you to determine what you do with what you have been entrusted with. The old adage is still true, people don’t plan to fail, they fail to plan. While plans are never a guarantee of success, and you may need to make some pivots along the way, you will never get to where you want to go without a plan in place.
Here’s to building a great church budget plan and seeing your church thrive in 2022!