February 9, 2011 Tony Morgan

When Is a Budget Too Big?

I saw a great article over the weekend highlighting the ministry of Church of the Highlands in Birmingham, Alabama. You should check out the entire article, but this particular paragraph grabbed my attention:

“The church sets its annual budget as 90 percent of the previous year’s income, to leave a 10 percent cushion in case of an economic downturn, and limits salaries to 35 percent of the total budget.”

Though I’m familiar with other churches that are pushing to lower staff salaries as a percentage of the total budget, Church of the Highlands is the only church I’m aware of that sets their budget based on 90 percent of the previous year’s income.

I’m familiar with many, many churches who take a look at the previous year’s income and then add a percentage based on their projections, prayers and hopes for what the future will look like. That may be described as the “faith factor”. I’m a man of faith as well, but I’d rather deal with the the problem of determining how to invest the extra money that exceeds a disciplined budget than deal with the challenges, stress and frustration that results when our “faith” exceeds God’s provision. (See Luke 14:28-30.)

This kind of approach to budgeting does takes discipline. What’s always amazing to me, though, is that when we create boundaries and live within those boundaries, it leads to more freedom. Church of the Highlands has been able to experience significant ministry impact because of their wise financial planning. They can do more because they’ve learned to live with less.

Are you familiar with other churches who have implemented this type of budgeting strategy? Do you agree that it has the potential of allowing a church to make a bigger impact? Join the conversation by sharing your comment.

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Tony Morgan

Tony is the Chief Strategic Officer and founder of The Unstuck Group, theunstuckgroup.com. For 14 years, Tony served on the senior leadership teams at West Ridge Church (Dallas, GA), NewSpring Church (Anderson, SC) and Granger Community Church (Granger, IN). He's written several books and articles that have been featured with the Willow Creek Association, Catalyst and Pastors.com.
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