The Economics of the Average Church

MoneyMatters_categoryGraphicOn this blog we try to focus on the average experience for the average pastor. So much of the church world is focused on the exceptional experience of the most successful churches. Many of the experiences written in leadership books usually reflect the 5-15% of pastors who pastor churches of over 200.

One place where the experience of the average pastor is most profound is in finances.  Nothing is perhaps more of a struggle for the average church than church finances.  My experience over the past 6 years has been a good one.  It has always been a struggle but we have managed our finances well and have had very few crisis moments. For that I thank God and my leadership team that has helped me navigate that.  My church pays me a full time salary and I have several part time staff members we are able to give a small weekly salary to.  But, I know even my experience is the exception.  For many average pastors, they would love to have even my experience.

The economics of the average church are difficult considering a couple of factors:

  • The average church is America is 80 people.
  • The average giving per attendee per month is between $80-$100.
  • The average church in America can only sustain one full time salary (if they can afford it at all) and only at the attendance level of 120 are they able to hire someone to help them. For example, 60% of churches in my state are pastored by bi-vocational pastors. These churches cannot afford to pay a full time salary.
  • Churches that are under 100, if they can pay a pastor full time, usually have to devote between 45%-55% of the income to the salaries, where as larger churches can be 35%-50%.
  • Many average churches are in smaller communities that do not have professional jobs available to people. Smaller communities are only getting smaller. And small churches are only getting poorer.

The economics of the average pastor and average church presents a unique set of challenges that small churches have to face:

  • You are expected to do more with less – People visiting your church expect you to have everything a larger church has, but with only a fraction of the resources.  We simply can’t keep up.
  • The pastor is expected to be just as committed to church life, despite the fact that 60% work jobs outside the church.  There isn’t enough time in the day to be working on developing vision, programs and people like  churches that can support a full time pastor.
  • The pastor usually is dealing with the burden of both the church and their own family money pressures.  Its a double edged sword for most pastors.
  • Many of the burdens of the menial tasks and issues cannot be solved by hiring people or buying a new one of something.  That means more energy is given to keeping something going by doing it yourself or going without.

Average Finances in the Average Church

As frustrating as the above challenges are, some economic realities also come into play for the average church verses the larger church.  If the average church is 80 people and the average per capita giving is $100 per month, then your average monthly income is $8,000.

  • If you pay a pastor, its $3,000 – $4,000 per month (45%-55%).  That is about the average salary for churches that can afford a full time pastor.
  • If you have a mortgage, a good range is 30% of your income; $2,500.
  • That leaves you $1,500-$2,500 for other expenses taxes, insurance, utilities and emergencies.  There is not much room for purchases, additional staff and luxuries like advertisement, hiring people to do lawn care, etc.

However, the example given above of $100 per month per person is the exception.  $80 per month for 50-70 people might be more normal for most of the average pastors I know.

  • Total income would be $4,000-$5,600 per month
  • Pastor’s salary could only be $2,000-$2,800 per month
  • Plus a mortgage, utilities, etc.
  • It is a real challenge to have a great church that offers lots of things and does lots of ministry when you barely can make your financial obligations!

Here is the reality of the average church and economics.

If you lose a family of 4 for whatever reason (move, go to another church, etc), you stand to lose $300-$400 per month for that one family leaving.  If you lose several families in a year, you could lose up to 15-20% of your income.

  • That could mean not buying a new computer for the pastor. So he buys it himself
  • That could mean the church not paying the pastor’s medical insurance (if they are able to at all).
  • That could mean not being able to pay a part time kids pastor or worship leader.
  • That could mean not doing an outreach that would cost $300 or not spending money on an event for the church.
  • That could mean not being able to buy ink cartridges to print bulletins.
  • All of these are realities that average pastors deal with simply by losing one family.

On the flip side, if it is a church of 300 people and the average income is $24,000 per month and they lose one family ($300 pm), you may not even notice it.  It doesn’t change whether or not you pay insurance, whether you can buy printer ink, whether you can by curriculum.  In many ways, a larger church may not even notice an average family giving an average amount in an average month.

The Blessings of Average Church Finances…

Yes, there are some! Its not all bad news and difficulty for us average pastors. There are some benefits I have found for average church economics:

  1. I am forced to be creative.  I used to just buy everything. Now I think of ways to do something without the option of buying it.  For example, most of my stage designs cost less that $25 because I buy things at the dollar store or borrow them from others.  Once you get used to not buying things, you appreciate the value of creativity.
  2. I am forced to use people.  Its easier to hire someone to mow or fix plumbing  or clean the church or build something.  But when you don’t have money, you look to the people in your church to chip in.  I have found that there usually people who enjoy those small tasks that make a big difference.
  3. I appreciate what giving means.  Every dollar has a face in a small church.  I see hard working people giving because they love God.  Therefore I respect each dollar. Its precious and is a gift of worship. The fewer dollars you have, the more you appreciate the people who give them.
  4. One family can change everything.  Because losing one family affects the average church so much, gaining one family can also help so much. For us, there is a huge difference between 70 people and 90 people.  Gaining three or four families can take the stress off and allow us to do so much more. There is a lot of hope that one of two families can bring.
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