Tag Archive: budget

Creating A Church Personnel Budget

Whether the personnel portion of your church’s budget is $50,000, $500,000 or 5,000,000, it should have at its core, some common elements.

If you’re involved in putting together your church’s personnel budget, here are key components and tactical steps you need to include (you can see it graphically here).

Step 1

Know and show your personnel budget number for the current year (ex. $200,000).

Step 2

Make any changes you’ve made to the budgeted amount throughout the current year (ex. you made a new hire and paid them $5,000 more than you had budgeted for the position. And you increased custodial hours from PT to FT, adding $14,000). You’ve then added $19,000 mid-year dollars to your personnel budget.

Step 3

This gives you your Revised budget number (in this example, $219,000).

Step 4

Estimate your insurance costs for the new year. An insurance broker can often anticipate increased costs based on what they’re seeing in the market. They can provide you the percentage increase for your plan before actual increases are determined (an estimate is usually available in late summer). For the sake of example, let’s show your needed reserve for insurance to be $6,000. (Obviously, if you’re church does not offer heath insurance, you can skip this step.)

Step 5

Determine your anticipated merit raise figure. While I don’t affirm the idea of a pre-determined % increase for everyone, and instead, prefer a merit increase that ties into a performance management system, you can still have a percentage as the average increase.

So let’s assume that on average, you want to be able to provide a 3% merit increase. You’ll do the math to add 3% to the base salary portion of your personnel budget (remember to add in the impact of merit on retirement benefits if you provide for them).

Step 6

Show any anticipated next year personnel hires. Or if you’re reducing your staff, you’d show that reduced number.

Step 7

Add these steps together. This will give you your next year’s personnel budget figure, you’d begin with your “revised current year budget,” add “health insurance,” add merit raise dollar figure, and add any new hires (or reduce any eliminations) to get to your total proposed next year’s personnel budget.

Here’s an example of how to show these steps in a personnel budget document.

The personnel part of a church budget is typically a large percentage of a church’s budget. So you’ll need to justify it by having a well thought out procedure and explanation.

Having this prepared budget will help you as you take the budget to your church’s decision makers. For other suggestions for presenting an overall compelling church budget, see this previous post.

Happy budgeting.

Continue Reading

My Top Five Blog Posts for Readers

I’ve now been blogging a year. Below are the posts that received the most views, or based on feedback from readers, were the most helpful in providing practical takeaways for everyday church leadership.

Thanks for being a reader.

The hardest thing a leader has to say—the last 2%

Succession planning for pastors (an interview with the Village Church)

Coping with church leader jealously syndrome

How to present a compelling budget

Hiring ministers and avoiding nepotism

Continue Reading

3 Months Blogging and My 3 Most Read Posts

I’ve now been blogging three months, and if you missed them when they were published, here are my three most read posts:

The Humble Brag Among Ministers http://bbapt.us/17wqjA5

How You’re Disrespecting Others http://bbapt.us/19BR5fV

How To Create A Compelling Church Budget http://bbapt.us/14zw2py

And because I’m in a giving mood, here’s #4 and 5 too:

When Success = Lost Focus http://bbapt.us/1fhD4qb

What Lice Taught Me About Evangelism http://bbapt.us/1b0Ma82


Continue Reading