A few years ago, our church decided to put on a 5K fun run as a fundraising event for a charity that provides shoes for the people in Uganda. Not to oversimplify things, but to me, there are two types of people: those who can run more than a few feet and me. But, I was determined to not just participate in the 5K; I wanted to run the entire 3.1 miles. The thought of running that far was quite intimidating. The leaders of this event equipped us with a plan to prepare for the run. The program they provided started slow (walking a mile and running 30 seconds at a time), gradually working us up to running the entire 3.1 miles. By following the plan for about four months, many of us, including me, were able to run the 5K.
For many, building a church budget can be like running a 5K for the first time. It’s intimidating and can feel overwhelming, but with a solid plan, success is attainable. Since churches focus on ministry, the administration and operations often take a back seat. Let’s be honest; most people don’t pick a church because of its excellent systems, procedures, and budget. Add to the mix increasing inflation along with reduced attendance and giving, and the need for a budget is more significant now than ever. These factors cause many churches to turn to budget templates to kickstart their budget process. I think about the countless hours and headaches it would have saved me if the internet had as many budget template options when I began my journey in ministry as they do today. But, I’m not sure I would have developed the processes and procedures our church enjoys today. As with anything, there are pros and cons to using a church budget template, and evaluating them is prudent before deciding to invest in one.
Pros
Saves Time: Even the savviest Excel power user knows that starting with a blank spreadsheet to create something as complex as a budget will take time – a lot of time. Using a template is like hitting the fast-forward button. The Chart of Accounts, formulas, structure, and formatting come complete with a good template.
Saves Money: Even when the finance team is composed primarily of volunteers, the budget process has a labor cost. Using a template lowers the costs by helping to reduce hours spent by paid church staff on the budget. Church budget templates refine the process and Chart of Accounts, thus decreasing the likelihood of duplicating or omitting a crucial line item.
Promotes Best Practices: No one is an expert at everything, and it is unrealistic and unfair to pressure the Lead Pastor to be a theologian, social activist, teacher, pastor, CEO, CFO, counselor, and best friend to everyone at the church. Even for churches that can separate duties and have a financial team or a pastor to oversee the finances, there are things to learn from others. These are known as best practices. According to Greg Satell in his Forbes article How To Use Best Practices To Spur Innovation Forward, employing best practices intelligently can increase performance in areas in weaker areas. A good church budget template used intelligently will strengthen church budgeting processes and procedures while making the financial team more efficient.
Cons
The Template May Not Fit Your Church: Each church is unique and has distinctive needs, and a church budget should reflect the church’s mission, vision, and values. Often, church budget templates are too generic and cannot reflect a church’s specific needs. Your church may place a high value on local outreach and require a more detailed Chart of Accounts to accurately budget and track those expenses. Churches with a facility should budget sinking funds to address upcoming costs, like HVAC replacements or a new roof, before they are due. When using a church budget template, ensure it addresses your church’s specific needs.
Not all Templates are Good: Some people have good intentions but lousy execution. Before using a church budget template, ensure it helps, not hinders your efforts. For example, does it accurately factor in housing allowances under compensation for pastors? What about FICA or benefits? Is it flexible enough to allow for modification without breaking it? Does it help you build the annual giving target (projected income)? Remember, the church budget template should help you, not create more work.
The Template is not a Magic Bullet: A church budget template is a tool to get you started; it won’t solve all the issues. There is still a lot of work to create a church budget. Take the time necessary to do it right. Project the income based on facts and trends. Cast the focus for the upcoming fiscal year that reflects the church’s mission, vision, and values to the teams. Adjust the budget accordingly so that it is a reflection of what matters most to your church.
Using a church budget template can accelerate the process and provide insights into best practices established by others with more experience. However, use discernment to ensure the church budget template you select is flexible enough to fit your church’s specific needs and will not create more work for you and the team down the road.
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