Since we’re all hearing a lot about money and anxiety these days, I thought I’d keep on the subject and talk about church endowments. (You know, it’s interesting how individual money anxieties can be played out on in our congregations. But that’s another post for another day….)
Our church has an endowment. And often I hear, “Of course your church can feed the homeless, build a clinic in Ethiopia, run on wind power, (fill in the blank). You have an endowment.”
Well, that’s true… in a sense…. The endowment does help, but we were feeding the homeless before we had a chunk of change in the bank. And I’ve seen many, many congregations wither and die, while sitting on a huge pile of money.
So, I’m wondering, what’s the healthiest way for church leadership to handle an endowment? If you asked me five years ago, I probably would have said, “Completely and utterly ignore it. An endowment is not worth the fight. It keeps the church from reaching out, it keeps them from needing people, and it makes their mission all about protecting investments.”
I probably would have told you that an endowment is more likely to kill a church than to revitalize it. I would have compared most churches with an endowment to a greedy dragon who breathed fire on anyone who tried to touch its gold.
As you can see… I’ve had bad experiences….
But, now I’m happy that we have one. I don’t really live under that anxiety, that feeling that I’m going to lose my job every time someone moves away or dies (which was a very real feeling as I pastored a small church). And we keep the money working, even in times of economic crisis. I could go through a laundry list of what we’ve done with it, but I’ll just sum it up by saying that in the last fifteen years, we have done a whole lot of mission work and planted two churches (one succeeded, one didn’t).
Here’s what we do. We have a draw, a set percentage of money that we take from the endowment each year, based on the endowment’s worth from the last 3 years. A conservative draw is 4-6%. We draw a bit more than that.
With a set percentage, you can plan your church budget, with a realistic number. And, you can keep the endowment working during lean years and fat years.
Another thing we do is talk about it. Have you ever seen one of those churches where no one knows about the endowment? All the statements are hiding under some treasurer’s mattress somewhere. And the church leadership says thing like, “If they knew we had money, they would stop giving.”
We talk about it. We tell people about it during new member classes, and have detailed slide shows during annual meetings. I think the endowment’s even on our website history. Everyone knows it’s there, and that it’s being used.
We even fight about it sometimes. There’s always a healthy discussion gong on about stewardship, long-term goals, and mission. When people have serious concerns about the endowment (whether our draw is too high, whether it should grow with inflation, whether we should invest some of it into pastor housing, etc.), then the person is invited to present their concerns to the church board.
An interesting things to note: whether a church has $50,000 or 5,000,000, the fights are still the same. Especially when it come to whether or not to spend the principal. I have to say… Presbyterians have the tendency to hold on to that principal no matter what. Which is sad, because when we have a load of dying churches filled with dying members, the principal is going to keep growing. And yet, we act like we’re holding on to the last quarter on earth.
The vitality of a congregation, and a denomination, depends much more on generous people who are willing to give of their whole lives than what happens to that number on the bottom line.
So what have you learned about church and money?
Photo’s by inkyfingerz