Jesus didn’t pull punches in his parable of the rich fool, condemning the man who built larger barns to store his ever-increasing wealth (Luke 12:13–21). If this is such a big issue, how ought church leaders to think about money in the bank? What’s the minimum a church should hold in reserve? When is a church flirting with the rich fool’s barns?
Such questions might make you uncomfortable. Christians sometimes talk about church finances as if they’re awkward cousins of real gospel ministry: “It’s a shame, but you’ve got to think about the church like it’s a business.” We assume preaching, evangelism, and discipleship are truly spiritual activities while finances are an unfortunate necessity—if not an outright distraction.
We assume preaching, evangelism, and discipleship are truly spiritual activities while finances are an unfortunate necessity.
The implication is that financial questions belong in the domain of the businessman, not the pastor.
The Bible, by contrast, calls money a window into the human heart (Matt. 6:21) and a tool for kingdom purposes (Phil. 4:14–18). Church leaders must consider the congregation’s cash reserves in terms of heart disposition and kingdom advancement. In his helpful book Budgeting for a Healthy Church, Jamie Dunlop points out that a church’s budget tells a story: “A good budget will tell a story about Jesus and his promises being worth more than anything this world could offer.” The church’s savings account is a page in that story.
There’s no shortage of philosophies about how much reserve cash a church should hold. A common approach is to consider what it costs on average for the church to operate each month and then build a savings goal using that metric. Opinions vary, but two to three months’ worth is a common guideline. The advantage of this approach is its simplicity. It’s easy to calculate and easy to understand. The related metric of days of cash on hand allows for a finely tuned savings goal.
Such a strategy makes sense for an individual who could lose his job and rely entirely on savings for a time period, but Dunlop notes it’s a less helpful guide for a church that’s unlikely to lose all income at once.
A church’s expenses are relatively consistent over the course of the year, but its income ebbs and flows. At the very least, a church must have enough in reserve to pay salaries and other fixed costs in those months when giving is lower. Beyond that, it’s wise to hold enough money in reserve to absorb a year-end shortfall if giving is less than expected. This gives the church time to recover financially in the next year.
For example, if the current-year budget calls for a 10 percent increase in spending over the previous year, it may be prudent to hold in reserve at least the equivalent of that 10 percent difference. This provides the church with the flexibility to recover from a giving shortfall gradually and prevent a crisis.
Some churches are more likely than others to encounter large, unplanned expenditures. A facility-heavy church, for instance, will inevitably contend with sudden and costly air conditioner and roofing problems; a church that leases meeting space won’t. A church’s philosophy of cash reserves should reflect these realities.
Neither Poverty nor Riches
Opportunities and dangers abound for both the church with little and the church with an abundance of cash in the bank. Churches with less than they desire in savings may consider questions like the following:
- Why do we think we need more? Is our desire legitimate? If so, are we corporately asking the Lord to provide?
- How might we take incremental steps to increase our savings over several years? Even a small monthly addition to the reserve account will make a difference over time (see Prov. 6:6–8).
- Might our financial need be a sign of poor spiritual health in the congregation (disobedience in giving) or in the leaders (unwise spending, failing to teach what the Bible says about giving)?
- How can we be faithful to make disciples and advance the gospel amid our financial need? How might we uniquely glorify God in our relative lack of resources (see 2 Cor 8:1–7)?
Churches with ample cash reserves should beware of the premature conclusion that abundance is a sign of spiritual health. They might ponder the following questions:
- Are we accumulating cash because we don’t have a plan to guide us in spending it for the advance of the kingdom?
- Are we hoarding cash because we lack faith in the Lord’s ability to provide for his church? Does our level of savings cause us to ignore our need for the Lord (Prov. 30:8–9)?
- Are our pastors, staff, and current ministries adequately supplied, or are we building up cash while our responsibilities go underfunded (see Prov. 3:27–28)?
- Are there needs within our church body, partnerships, or denomination that could be met with the abundance God has provided for us (Acts 4:34–35)?
- Might God be leading us to open a new front for the gospel by supporting a nearby church plant or a missionary in another part of the world (see Rom. 1:11–12)?
Jesus said, “Where your treasure is, there your heart will be also” (Matt. 6:21). What does your church’s reserve indicate about its heart? Is the savings account orienting the heart of your people toward the King who is coming again?
What does your church’s reserve fund indicate about its heart?
A church’s philosophy of savings is itself a form of instruction. When a church is tightfisted in spending, undisciplined in spending, or preoccupied with money, it can create disciples who reflect those attributes.
By contrast, when a church is wise and kingdom-oriented in its financial stewardship, saving what’s prudent and joyfully spending the rest for the sake of the King and his kingdom, it influences members to do the same.