Eight Common Money Questions Asked by Pastors

I have informally counseled hundreds of ministers about financial matters. My background lends itself to such interaction. I have a business degree with a double major in finance and economics. I served as a corporate banker before answering the call to vocational ministry.

In ministry I went to seminary and received two degrees. I served as pastor of four churches, and as dean of a seminary.

My life has consistently been the intersection of business and ministry. Indeed, my current position as president of LifeWay is the perfect example of that intersection.

The purpose of sharing my brief bio is not to brag, but to explain why ministers gravitate toward me on financial matters. Hundreds of ministers have sought my advice. I am humbled and happy to share my knowledge with these servants of God.

Allow me to share in this post some of the more common questions I have been asked. There are probably more than a hundred questions I omitted; these are simply the top eight I have been asked most frequently.

1. How do I broach the subject of getting an increase in my pay? Pastors and other ministers are typically very sensitive about this issue. They fear asking the question lest they appear lacking in faith or money hungry. The pastor must first determine if his pay is indeed well short of standards for his area and position. We discussed this issue in my previous blog post about pastors' salaries. I then recommend he find a trusted friend in the church, preferably a leader and a businessperson, who can be both his mentor and guide for broaching this subject. Someone other than the pastor himself should speak to this issue.

2. Will I be okay for retirement? This question may soon move to number one as boomer pastors approach retirement. Sadly, a number of aging pastors are not prepared for this day. They had this naïve idea that things would just work out. They did not prepare for the inevitable. Often churches did not offer any retirement benefits. Many boomer pastors are getting some sad wake-up calls. I encourage pastors to seek a financial advisor as soon as possible to plan with the few years they have left in fulltime ministry.

3. How much can I designate as housing allowance? First, I encourage pastors to make certain they meet the IRS requirements to have an allowance. If they do, the housing allowance can be no more than the lowest of these three items: 1. The housing allowance designated by the church; 2. Actual housing expense; and 3. Fair rental value of the home. Guidestone has an excellent FAQ on housing allowances.

4. How much should I save for retirement? I really like this question, because it means that the pastor understands the nature of retirement. In the past in most vocations, we often depended on "the company" to provide our retirement income through pensions. That has all but disappeared. Today the employee is responsible for his or her own future. It's great if an employer has a 401(k) or a 403(b) for employees to save toward retirement. It's even better if the employer offers some type of matching funds. But ultimately, it's up to the employee, in this case the pastor, to be prepared. Many times that means supplementing employer plans with savings or Individual Retirement Accounts. The question itself is difficult to answer because it involves so many variables. The best answer is "as much as you can as early as you can." Sometimes the number of 10 to 15 percent of gross income is offered, but that too is a very rough guideline.

5. Is it okay to accept a small stipend for weddings and funerals? Though there are always exceptions, the general answer is "yes." The pastor typically has to spend work and time (especially for weddings) beyond his weekly responsibilities. Weddings, with Friday rehearsals and Saturday ceremonies, take a pastor from his family for the entire weekend. One year as a pastor I officiated 40 weekend weddings.

6. Should a pastor's salary be clearly shown on every church financial statement? Polity, policy, and tradition determine the response to this question. In most of the churches I served, my salary was not itemized on the financial statements; it was lumped with other salaries. We did, however, have an open book policy that allowed any member to see the salaries if he or she requested.

7. I can't pay my bills. What do I do? Find a trusted advisor immediately. Find someone who understands personal finance well. The first thing you will need to do is determine if you have an income or expense problem. An income problem means that you simply do not have sufficient income for someone in your position. An expense problem means that you are managing your finances poorly. Don't wait to get help. Your emotional health and reputation are at risk.

8. Is it okay to leave a church for financial reasons? The Bible clearly teaches that we are to manage our household well (1 Timothy 3:4-5). That management includes the financial stewardship we have been entrusted. In that sense, if someone cannot provide for his family, it is likely okay to seek another church. The pastor, however, must first ask himself some tough questions. Am I struggling because of my own mismanagement of money? Am I demonstrating too little faith? Have I shared my plight with any trusted person in the church?

Dr. Thom Rainer is president and CEO of LifeWay Christian Resources of the Southern Baptist Convention.

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