Inflation is sitting near 8%, the Federal Reserve has indicated its target rate for the Federal Funds Rate will be 4.4% by the end of 2022, the major markets are all in the red for the year and requests for assistance to your Church continue to rise.
This is the time to review your Church’s operation to ensure you are being good stewards of your Church’s finances, and you will be successful in your ministries during a recession. A couple of things to consider during these turbulent times:
- Review your budget regularly. While many Church council’s sit down in the fall and create a budget for the following year, the document needs to be reviewed regularly. Ensure you are pinpointing areas that are not meeting the budget and create an action plan.
- Review the balance sheet to make certain you have sufficient cash or liquid assets to ensure your continued ability to operate. Have an emergency fund in case revenues drop quickly and needs increase.
- Monitor revenue streams, not only the total amount given but the number of givers. A reduction in givers may indicate a larger long-term issue of declining membership that can be discovered prior to renewing church enrollment/rolls. If declining membership is discovered a church win-back program could be initiated.
- Members who have stopped giving can be contacted to obtain a better understanding as to why they stopped. This can create additional options for the Church. If the member has left, do an exit interview to discover why. If the member has stopped tithing and it is due to their financial situation, the member may have skills that could assist the Church through a rescission.
- Review debt, and determine if long term debt be reworked to improve cash flow so basic operations of the church can continue.
- Review paid staff; Can jobs be reworked to achieve better utilization of staff to maximize their potential. Cross train teammates. Delay filling open jobs until the financial position has improved.
- Review programs: Are there programs that are not being utilized because of a changing demographic in your church or because of a societal change? This is also a great time to review the ministries that are more important in your community and add them.
- Look at additional revenue streams. This could include maximizing the use of your physical plant. Quite often buildings used by religious institutions are not fully utilized. Program or meeting space could be rented for a couple of hours during the week when the building is normally locked up to generate rental income. Live streaming services behind a paywall for nonmembers is another example of an additional revenue stream
Nobody knows where this volatile economy is going. However, you know you can count on the Trusted Choice Independent Insurance agents at Richey-Barrett to work with you to create a comprehensive insurance program that will meet your needs in a recession or during an economic boom.