How to Avoid the Epidemic Killing Our Churches

by | March 21, 2018

An epidemic of Biblical proportions is significantly impacting churches of today. Currently sweeping across the landscape of Christianity, this epidemic disables and ruins countless churches every year. This deadly disease is debt. The debt epidemic begins innocently enough. It typically begins with someone from the building or finance team passionately misquoting the famous line from Field of Dreams, saying “Build it and they will come.” Soon people begin to nod in agreement. The debt epidemic has begun.

The debt epidemic gains momentum when the architect says, “tell me everything you want in your building and don’t worry about the cost.” Recently, I visited a church in the midwest. In the beginning stages of this disease, the church’s annual budget is less than $300,000. After meeting with the architect, the plans for the new building were presented–a $3 million project. The drawings were beautiful and very enticing. One church member even exclaimed, “there is even a fireplace in the gathering space!” Other early symptoms of the debt epidemic include phrases like, “I’m sure the people in our community will want to help pay for it” or “All of the new people that we attract will pay for it.”

“Build it and they will come” has become, “Build it and they will pay for it.”

The next phase of the debt disease usually includes the church hiring a firm such as Horizons to help them raise the money to build their Field of Dreams. Often what they really want is a plan to inspire others to pay for their building.  During this phase, the church either becomes deathly ill or finds the right prescription to avoid succumbing to death by debt.

How does a church avoid succumbing to the debt epidemic?

 

Here are some ways to avoid the debt epidemic in your church.

1. Preventive medicine is always the best.

Hire someone like Horizons before you hire the architect. We can help set parameters that will prevent your architect from proposing a project that could result in extraordinary debt. This first step can prevent the disease from taking hold and save your church from contracting the debt disease.

2. Always insist on a pre-campaign feasibility study.

A quality study will include a projection of the dollars your church will likely raise from a capital campaign. Although a quality study will provide the data you need to prevent deadly debt, the results can often be a bitter pill to swallow. Churches typically spend thousands of dollars on building plans and church leaders are excited to see it become a reality. However, as your partners in ministry, Horizons’ strategists will honestly tell you if the current plan is beyond your congregation’s capacity to fund it. While potentially painful, knowing (rather than guessing) your congregation’s willingness and ability to fund your project is a necessary step for preventing deadly debt.

3. Test your plan with key financial leaders before going public.

A capital campaign will invite everyone to participate in making your church’s vision a reality, but a few key financial leaders will contribute the majority of funds. (Here’s how to identify and grow a few key financial leaders.) Inviting high-capacity donors to weigh in before unveiling your project to the congregation may illicit substantial support.  For example, a church had fallen in love with a project that cost eight times their budget. Initially it seemed they might take on a deadly amount of debt in order to fund it. After showing the project to key financial leaders, one couple became was so excited they decided to give nearly 40% of the project. Death by debt avoided.

 

How much debt is healthy and how much is deadly?

1. The most effective strategy is to conduct no more than two capital campaigns in a row for any one project.

Many pastors, donors, and volunteers experience campaign fatigue following two three-year capital campaigns. In addition often these same church members are involved in the building project, leading to a strain on volunteer resources. I’ve worked with churches that have had to conduct six and seven campaigns in succession to eliminate their deadly debt. Not only did it exhaust church leaders, but it also prohibited any growth in mission and ministry  until the debt was paid.

2. The pre-campaign feasibility study is an essential tool in right-sizing your project and avoiding deadly debt.

For most churches, it is unwise to take on a project that exceeds two times your feasibility study projection. Of course, this is simply a rule of thumb and may not apply to every situation. Things like high-capacity donors, investment income from endowments, and other factors may play a significant role in determining your church’s ability to fund your project. Also consider whether you have resources misaligned to your mission.

3. Debt service should not exceed 10-15% of your annual operating income.

Most churches that carry debt service exceeding 15% of annual income are unable to begin new programs, hire staff, or expand ministry. Death by debt becomes a real possibility.

 

Succumbing to death by debt is not inevitable. There is a cure.

Incurring a healthy level of debt within the guidelines I’ve shared may be an important strategy for achieving the vision God has for your church.  Field of Dreams may be a great movie, but it does not include sound advice for your building or renovation project.

4 Comments

  1. Avatar

    As always Scott is spot on. Miss you my friend!

    Reply
    • Kristine Miller

      Thank you, Paul!

      Reply
  2. Avatar

    Thanks for a great article. I especially appreciated the value placed on the feasibility study.

    Reply
  3. Kristine Miller

    Thank you for your affirmation, Ed. Much appreciated.

    Reply

Submit a Comment

Your email address will not be published. Required fields are marked *

Everything you need to inspire generosity.

RECENT Posts

Three Prescriptions for Curing a Scarcity Mindset

Do you hear things like, “Money is tight! We need to tighten our belts?” Or “People are giving all they can. We can’t ask them to do more?”

 

If the answer is yes, then your church may be afflicted with a scarcity mindset.

 

In this video, Kristine Miller, CFRE, Partner and SVP at Horizons, will discuss ways to overcome a scarcity mindset and the fear and hesitancy created by a glass-is-half-empty attitude. Also, you will learn how to build a culture that celebrates God’s abounding blessings and grows generous hearts.

 

In this next video in Horizons’ Giving Intelligence Series will help your church giving and move to the next level of generosity.

 

 

Horizons’ Next Level Generosity (NLG) framework can help you create and carry out your Generosity Battle Plan. Beginning with a comprehensive 360-degree analysis, your Horizons Ministry Strategist will create a clear and effective strategy for shifting your generosity culture. The result is more money for ministry and authentic life-change for your congregation. To arrange a free 20-minute consultation, contact info@horizons.net

 

Did you miss the first installments in Horizons’ Giving Intelligence Series? Find them in our free Giving365 vault by clicking on the Giving365 logo below.

Giving365 - Blog - Horizons - church stewardship resource

To find out more about Kristine Miller, click here.

 

What Church Leaders Need to Know About New Giving Trends

Ten years ago, in Not Your Parents’ Offering Plate, I voiced my concern that giving to religion, as a share of overall giving, had fallen significantly over the last several decades and was half of what it once was. At the time, the giving trends indicated that if we did not change the way we do overall stewardship in the church, the decline in giving would continue. Well, now it has happened!

 

For the first time ever, giving to religion as a percent of overall charitable donations has dropped below 30%.

 

For 2018, Giving USA reports gifts to religious organizations are down 1.5% to just 29% of total charitable giving. Total giving to charity rose to 427 billion dollars, but this came more from foundations and corporations and not from individuals–the church’s primary revenue source. On average, Americans gave away only 1.9% of their disposable income.

These giving trends are as alarming to me today as they were back in 2008 when I first rang the bell of concern. Financial resources are not our mission, but they are the fuel that propels the mission.

 

Without money, there can be no mission and no ministry in these days when the faith is struggling around the world.

 

What caused the latest decline? Some will blame the last tax law changes that significantly increased the standard deduction and thus reduced the number of people who itemize. Others will say that it just reflects that fewer people are in church and the world is more secular. I do not buy into the theory that the causes are all external and thus any solution must be external. I still hold to the conviction that the solution is within the church to save the church, but we have avoided the hard work necessary to make the cultural adjustment to get it done. In the strongest possible way, I am encouraging you to re-examine how you are teaching and preaching financial stewardship. How are you moving your church away from the stewardship methods of the 20th century and responding to a new 21st century culture?

 

How will you respond to the latest giving trends?

 

You do not need the new 2019 annual campaign in a box. You may not even need a capital campaign. What you do need is a systematic long-term culture shift that creates not just funds for the budget but generous hearts and minds. As I shared in my latest book God vs. Money, you need a Battle Plan.

Right now, many of you are thinking about what you are going to do for a fall stewardship emphasis. That is fine, but that is not going to fix the problem. Let me encourage you to form your fall campaign committee and put them to work if you must, but at the same time form another group that will go to work on a Battle Plan for generosity to change your whole church. If you are brave enough, go ahead and start to execute the plan ASAP and just skip the old approach. Why would you think just doing the same old thing will produce a different result? You may not be able to change America’s giving to religion, but you sure can do something to change your congregation to be generous followers of Christ.

 

Horizons’ Next Level Generosity (NLG) framework can help you create and carry out your Generosity Battle Plan. Beginning with a comprehensive 360-degree analysis, your Horizons Ministry Strategist will create a clear and effective strategy for shifting your generosity culture. The result is more money for ministry and authentic life-change for your congregation. To arrange a free 20-minute consultation, contact info@horizons.net

 

The Top 5 Ways To Accidentally Reduce Church Giving

In my over forty years of ministry, I have never heard a pastor say he/she has more money than the church needs. I have certainly found pastors who shared that their people were very generous or that they had out-given their budget, but never that they had too much. The mission is too big and the need is too great to not always need more. Yet every year I come across dozens of pastors and laypeople who are doing things that absolutely reduce church giving.

 

Are you doing things right now that unintentionally reduce giving in your congregation?

 

Here are five ways to accidentally reduce church giving:

 

1 – Emphasizing numerical targets versus missional objectives.

I have seen so many pastors encourage their people to give “an increase,” “do 3% more,” or “help us balance the budget.” The facts are that people today just do not care whether you achieve some arbitrary target or not. They want their gift to have impact and change lives. Spend your energy sharing with people how their giving to the church will make the world a better place.

 

2 – Publishing church giving figures in the bulletin and/or newsletter.

This sends a signal to all that this is what you really are about. You are wanting to bring in more than you send out. It says nothing about your mission and it usually appears to reflect an unhealthy church because you are behind for the year. Facts are 90% of all churches are behind until December. It is normal, not a sign of impending death. Just stop doing it.

 

3 – Using a line item budget to communicate with the congregation.

There is nothing about a line item budget that helps your people understand what you are truly doing in ministry. From appearances it seems that all that you are supporting are some people and a building. Line item budgets should be used only by the finance people. Distribute a missional budget to the congregation.

 

4 – Apologizing or joking prior to delivering sermons on money.

When Moses came down from the mountain and saw the golden calf that the people had made to worship, he did not make a joke about it or apologize for what he was about to say. He was forceful and direct and they knew he meant what he was saying. There was no misunderstanding that he considered this a very serious matter. They had put worshipping a golden calf ahead of worshipping God. Your people are doing this every day that they choose money over God. It is a big deal. People need your help to give up that which they love more than God. Quit acting like it really does not matter.

 

5 – Thinking that “not knowing” what people give is a righteous act.

For some reason pastors think people will think more of them if they deny themselves knowledge of individual gifts. This behavior will keep you from putting the right people in leadership, being able to diagnosis spiritual health in persons, and thanking people when they truly need and often expect thanks.

 

Now, go forth and quit doing those things that hurt the Kingdom!

 

 

 

Have you missed the first installments of the Giving Intelligence video series?

If you’ve missed the beginning of the Giving Intelligence series, they can be found on Giving365 which is a free subscription from Horizons Stewardship that includes this new video series, blogs, ebooks, webinars, and more! Subscribers receive bi-monthly blogs including information on best practices, the latest trends in giving, and helpful tools to use immediately to grow giving. In addition, Horizons’ team of Ministry Strategists will share their insights and expertise through a series of webinars. To access more of Horizons’ free stewardship resources, click the Giving365 logo below.
Giving365 - Blog - Horizons - church stewardship resource

 

The blog was updated from the original published April 29, 2017.

 

 

OUR NETWORK

Follow Us

PO Box 627
Cabot, Arkansas 72023

Pin It on Pinterest

Share This