Budgeting is often seen as a necessary evil. It should never be. One big lesson from the Great Recession is that bad budgeting can lead your ministry to the brink of failure.
Conversely, the process of building a good budget is essential for ministry success. Without a good budget to guide the use of limited financial resources, too many “good” opportunities can distract you from your ministry’s mission.
Here are three key principles that can help you budget better:
- Align your budget to your mission and vision. Your ministry’s strategy should clearly outline key objectives and outcomes you intend to accomplish in the next year. With this clear strategy, you can invest your resources to accomplish these objectives and outcomes.
- Good budgeting requires extensive collaboration. Putting a budget together is not just for the finance team or senior leadership. It requires that leaders grapple together with how to achieve their ministry’s key objectives and outcomes. This will often require some give and take and may even prompt revision of the key objectives and outcomes to make them more realistic.
- Once your budget is approved, monitor it regularly, report to your leaders at least monthly, and hold them accountable. If revenue or expenses have changed significantly, you may need to make adjustments.
What have been some success factors for your ministry as you’ve gone through the budgeting process?