November 11, 2009
Church Budgets: How Much for Staff, Buildings, and Ministry?
An executive pastor suggests a different analysis of expenses.
Paul Clark, one of Your Church's contributing editors, wrote an interesting post this week on his blog. Paul is an executive pastor who at one time spent several years in a managerial role with General Electric. His business background gives him an interesting perspective on how churches operate.
This week, Paul challenges three common questions often asked among church administrators: What percentage of a church's budget should go toward personnel expenses? Facilities? Ministries?
"Those are great questions, but they are a bit narrow in their scope. The reality is that a church budget is a reflection of the overall strategy and focus of the church in a given calendar year. That focus can change from year to year and consequently, the budget percentages will change accordingly."
Paul then illustrates what he means, making the case for projecting expenses further into the future to truly understand overall budget ramifications.
The average breakdown in expenses for church operating budgets, based on responses from 1,168 church leaders:
- 38% toward salaries and wages
- 12% toward buildings/facilities
- 8% toward utilities
- 7% toward ministries and support
Our survey participants mostly hail from small- to mid-sized churches; organizations like NACBA and Leadership Network, both of which typically survey larger churches, report salaries and wages, on average, take up 45% to 50% of church operating budgets.
Like Paul asks, how does your church assess these expenses, and how those expenses reflect--or don't reflect--the church's direction now and in the future? Is an analysis like Paul proposes more instructive for current and future church budget planning?