Church Finance & Stewardship – Purchasing or Building: Reasons For, and Complications Of

I felt convicted to write this article to assist those who may be in ministerial leadership roles that oversight over Church or any Not-For-Profit governance and more specifically, finances.

I am very fortunate and blessed in the regard that I get to serve God through my passion in business & finance. I’ve always been fascinated by the business world since I was a child and have been fortunate to receive opportunities from God to grow this passion through my experience that ultimately led to working with organisations who may be responsible for a few funds, to organisations responsible for billions of funds – with many of these organisations being not-for-profit or religious based.

So could say have learned a thing or two about what appropriate stewardship of finance looks like in an organisational sense!

As for now, I am working in my own organisation that, whilst has different finance offerings, was originally established to provide a service to help churches and NFP’s with their lending or finance needs.

Often when helping churches the main questions we receive is along the lines of “how much money do we need to purchase this building/complete this project” or “how much money do we need to be making to borrow the remaining funds?”. We then advise the church that based on what they want to achieve they need to achieve $X-surplus over the year (or in normal business/for-profit terms, achieve $X profit per year).

The elders or key people of the church then rightly start to plan on how they may achieve this goal:

• We could start a building fund and communicate our vision, ask the church members to bless us
• We can save for the deposit and monitor our expenses a bit more closely
• We can pray that he will show us how to complete this project (this should be the first step!)

All of those ideas are wonderful, and I strongly encourage churches that if they are going to pursue purchasing a site or completing a build that these are expensive projects and the congregation should be kept informed and understand why the church wants to pursue it in the first place; whether it be because your church is at capacity, whether it’s because Landlords are being difficult for the church and you want that security, or whether its because that building is located in an area the church feels called to witness to.

Some of the strongest churches I’ve seen with regards to finance (noting strong doesn’t necessarily mean the highest tithes received) are the ones whom communicate openly and effectively regarding their organisations finances to their members. Members tithe or offer the money that God gave them through wages & income back to the church, but if they trust the church then, anecdotally, I notice that offerings above the members’ tithes seem to be higher and more consistent.

Purchasing also requires the stewardship or a large amount of funds that churches may not usually have access to, and this requires leadership to manage.

Now some people may differ, and it may not always be the right thing for every church, but I do think churches should buy buildings for two main reasons:

1. It secures land that can be used for religious use: we know all too well that Government and certain lobby groups try to make it harder for churches to operate, and if a church can purchase land it provides greater security that it can be held for generations as a place of worship. Even if the church moves, they can sell that land to another church or hold on to it for kingdom purposes. Once zoning is changed away from religious use, it is a fight to get it changed back.
2. It saves cost over the long-run: once a building is paid off the church no longer has to pay rent (noting that initially it is more expensive but as a loan reduces it is cheaper than leasing a premise). Churches should be long-term focused as opposed to the short term focus we see in Governments or large organisations where leaders are mostly incentivised on short-term metrics (bonuses, shareholder returns, or re-election). This then means the church has more money for kingdom investments in their local community (that is investing in seeing people return to Christ… only a Christian banker could make a godly analogy out of finance!) through outreach programs and the like.

So what are some downsides or risks of purchasing then?

It can be difficult to raise the deposit required and it’s often a journey. One of my encouragements I give to churches when they seek my advice is that if purchasing is truly in their church’s vision, that they shouldn’t forget that investing in their community is what helped them grow in the first place.

Yes – churches should focus on the income and expenses and appropriately managing both of them to make sure there is a healthy or sustainable income surplus to cover the expenses of a sought loan, but no – do not forego investing in your local community or outreach just to get the building, otherwise who is going to come in through your new building’s doors!!

So to summarise; yes elders should review finances and see if unnecessary expenses can be saved, but not at the opportunity cost of kingdom investing in their community, and it you want or need to lift the offerings for the project then communicate to your congregation why you want to purchase or build. If it’s a true calling for the church and its members are onboard, they will support the church through additional offerings God calls them to give.

There’s no formula as to appropriate management of church funds, it’s just as much an art & act of faith as it is a science.

However if your Church is on the journey to buy or build and requires support, then it’s good to have clarity on how the financials need to look.

And you don’t have to do it alone – sometimes being appropriate stewards is seeking the right advice, and there are Christian networks of business professionals whom love and serve the Lord and can apply their God-given knowledge and experience to benefit the Kingdom and improve the kingdom-returns in your community or outreach.