Leading ministry in today's rapidly changing environment continues to become more challenging. Not only do you need to be aware of effective growth strategies, but you also need to beware of the many potential pitfalls that can quickly become costly mistakes.
Whether you are new to ministry or a seasoned veteran, this blog post will provide valuable insights and strategies for navigating the complex world of money and ministry.
1. What are the most common financial mistakes in ministry organizations?
There are many common financial mistakes churches and faith-based ministries make. While not a complete list, here are a few that Horizons most often encounter: wishful/aspirational budgeting, ineffective financial forecasting, failure to manage spending, ignoring negative trends, a lack of internal controls, failure to establish or act upon key performance indicators, failing to thank donors, ineffective donor communication strategies, and a failure to create a year-round generosity plan.
2. How can you avoid these mistakes?
It is important to be aware of the signs that you may be heading down the wrong path. A great resource to help you identify and avoid common mistakes is found in 7 Financial Mistakes You Don’t Want to Make which was created in partnership with CapinCrouse.
Another way to avoid common mistakes is to follow Horizons Integrated Funding Model when developing a year-round generosity or ministry funding plan. This approach is built upon dozens of proven strategies segmented into five key disciplines that are focused on growing annual, capital, special, and planned giving, as well as stewarding your assets to create additional ministry funding.
Additionally, it is important to be aware of current trends and best practices in money management so that you can make informed decisions and adapt quickly. Giving365 is a highly recommended free generosity resource library full of all kinds of generosity and financial management helps.
3. How can you balance your time and energy effectively when managing money and ministry?
To effectively manage competing demands, it is important to set clear priorities and develop plans for managing your time and energy effectively. Begin by asking yourself, what thing can only you accomplish and what can be delegated to other staff, leaders, or volunteers. Inviting volunteer skilled leaders and entrepreneurs to help identify and solve challenges you are facing. They have often solved similar challenges in their own work.
Other strategies that may help with balancing time and energy include creating a detailed schedule or routine for your work tasks, utilizing tools such as project management software to stay organized, making use of support systems such as mentors or coaches, and actively prioritizing rest and self-care when needed. With commitment and discipline, finding the right balance between your professional responsibilities and other areas of your life is possible.
You don’t have to go it alone. Horizons offers a variety of coaching and consulting options that can be tailored to your needs and organization.
4. What immediate steps should you be considering to prepare for growing and funding your organization?
One of the most important steps to building strong personal relationships with key stakeholders such as your ministry and financial leaders. You can start by reaching out regularly to stay in touch by sharing news and updates about your organization's work. Your next step is to schedule one-on-one time with these key leaders. Remember, you primarily want something for these leaders, not something from them in these relationship-building moments. Ask open-ended questions like, "what is God doing in your spiritual life right now?", "what most excites you about the ministries of our church?" or "who thought you to be generous?" Ministry and financial leaders also enjoy being asked for their insights and thoughts about challenges you might be facing.
Another critical task is to understand what is currently working and what is not providing the return you need on the investment of time and financial resources. Horizons calls this discipline "measuring effectiveness." Before you can measure, you need to establish clear outcomes for each area that are consistent with your mission. The realities of limited resources often force us to choose between good, better, and best. We simply cannot afford to do everything that is good. Equipped with clarity of the outcomes you desire to achieve, collecting and analyzing relevant data points is your next step. There is great software to help you easily access the information you are already collecting but probably not using to its fullest. To learn more about analytics read Every Number Has a Story.
Funding and managing ministry is an ongoing challenge even in the best-run organizations. An excellent overview of successful best practices can be seen in the eCourse, Five Disciplines of Financially Thriving Churches.
With these tips in mind, you can begin to confidently navigate the world of money and ministry and achieve your goals.
Want to learn more? Check out our on-demand money and ministry learning experience: Money and Ministry: 7 Financial Mistake You Don’t Want to Make.