What are the cornerstones of a thriving church? The success and impact of your church depends on your pastor, an active church community, and some would even say an engaging music program. Yet there’s another important, often overlooked, driver of your church’s success—your church’s financial management process.
You may be thinking, “Wait, at our church, it’s about the mission, not the money!” Yes, sharing God’s Word is your purpose and mission, but to continue that important work, good financial management is absolutely necessary. It allows you to manage your church finances efficiently and get a clear picture of your church’s overall financial health.
How to manage church finances
Streamlined church financial management processes can help you create accurate projections, make important budgeting decisions, and provide transparency and accountability to your congregation. Church software, embedded with intelligent finance tools, makes these processes faster, easier, and more accurate, helping you lay a strong foundation for your church’s successful operations, today and in the future.
Successful Church Financial Management Relies on Data
Are you meeting your church’s individual donor goals? Can you afford that new roof or playground makeover? With the constantly changing economy, have you adjusted your five year financial forecast? These questions are critical to the financial health of your church. But they’re virtually impossible to answer without reviewing and analyzing data. A streamlined church financial management system helps you:
- Track income patterns to anticipate financial trends.
- Use predictive modeling to adjust budgets for long-term financial stability.
- Understand donor’s journeys for more effective campaigns.
- Confidently provide accurate reporting to financial stewards, auditors, and your community.
Idlewild Baptist Church’s Men’s Ministry and Financial Steward, Rob Taylor, shares that to minister effectively, you need to consider the numbers. “Behind every number there’s a person and behind every person there’s a story and every story matters to God. It’s not just about data, but the data will help us in a great way. You’re not going to be a church long if you don’t make strategic moves and engage with technology.”
The Cost of Manual Church Financial Management
Church leaders everywhere feel the challenges of manual financial management. The old cliche “preaching to the choir” likely resonates here! While each ministry’s scenario is unique, here are some of the most common pain points of trying to manually keep track of church finances.
- Manual processes are error-prone. Entering donations manually, usually by different part-time staff or volunteers, leaves you open to errors that are hard to track and correct. And let’s not forget the arduous trips for bank deposits and follow ups when expired credit cards interrupt scheduled giving. Did you know 49% of all church giving transactions are made with a card? (Nonprofit Source) Automating and updating this payment method should be a priority.
- There’s a lack of transparency. Creating important financial statements by copying and pasting numbers and formulas from different sources is not only time-consuming and potentially inaccurate, but it doesn’t convey transparency and trust. Auditors, financial stewards, and your congregation all expect clear and easy-to-understand financial reporting.
- It’s very time consuming. Manual financial management processes take hours, even days, to complete each month. Often by the time reports are ready for review, these numbers are already out of date.
- There’s no automated data analysis. Most churches don’t have the valuable insights from a data analyst on staff to cull through the reports, so financial opportunities or red flags may be missed.
If one (or more) of those pain points resonated with you, it’s likely time to reassess how your ministry handles your financial management.
Embracing Technology to Better Manage Church Finances
One of the easiest ways to transition away from manual financial management is to invest in an all-in-one church platform with embedded financial tools. This type of comprehensive software houses all your church’s data points so you can automatically track growth and engagement, freeing up time to focus more on your ministry and purpose. With all your data in a single place, you can whip up more accurate projections at a moment’s notice, giving you the confidence to plan for the future.
This kind of on-demand access is invaluable when you’re considering big projects like new capital campaigns, calculating and allocating budgets, and creating smaller fundraising and digital giving initiatives. Plus, with the ability to evaluate donor trends as they happen, you’re perfectly positioned to uncover fresh ways to re-engage members, convert offline donors to online giving, and even encourage recurring donations. Research shows recurring givers donate 42% more annually (Nonprofit Source).
Digital giving and financial management software can also go beyond data analysis, offering automated giving features, like notifications when payment processes stumble or cards are nearing expiration. They can even provide options for donors to cover processing fees. These features help make the giving experience for your donors as easy and joyful as possible. Additionally, robust security measures to secure payments and billing, and maintain necessary documentation for compliance and audits, bring peace of mind to everyone involved.
Dive deeper in building budgets for your church
When looking for a church financial management platform, make sure the system is easily customizable. It should also be smart enough to highlight opportunities for saving and growth. Reporting and accounting should include and analyze all facets of giving, operating expenses, forecasting and predictive modeling. Look for vendors who are industry leaders, incorporating new technology and machine learning into everyday software requirements.
The Role of Ongoing Financial Management for Churches
Financial management is more than maintaining books or ensuring bills are paid on time. It’s also about using data to continually refine your ministry’s financial strategies and processes. Data insights help churches make informed decisions about their finances. From identifying successful fundraising efforts to finding areas to cut costs, data can streamline processes, optimize resources, and drive the church’s mission with financial stability.
Regular audits and reviews are another integral part of ongoing church financial management. Beyond meeting legal and tax requirements, they serve as an important step in risk management. These reviews can also help identify potential issues before they become major problems. It’s an opportunity to spot inconsistencies, errors, or anomalies that might indicate a risk to the church’s financial health. These ongoing efforts are key to the successful operation of a church.
Fuel Your Mission With Pushpay’s Financial Management Software
It’s your mission to spread God’s Word. Pushpay’s software is designed to fuel that mission. We know you need a clear financial picture today and an accurate path to move forward tomorrow. By streamlining your church’s financial management processes, you not only foster trust within your community but also strengthen the foundation from which your mission can continue to grow and touch more lives.
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