Why Financial Education & Stewardship Classes are Important

You Can’t Challenge Insolvent People to Give

This is what you will find:

• The top 1/3 of your donors will give on a monthly basis and these donors represent at least 75% of your total church giving!

• The middle 1/3 of your donors will give sporadically, two or three times a year.

Sometimes these donors will give a meaningful amount.  The bottom 1/3 of your donors will give $10 to $25 on a monthly and / or random basis.

How do we know this? How can we say this with such certainly?

We’ve pulled hundreds of these Donor Reports for our various clients and the reporting results are consistent across the board.

What’s the conclusion?

This report provides you with empirical evidence that 2/3’s of your congregation is not tithing. Some of these donors may have the financial means to give more, that’s another conversation. However, one must conclude that many of these donors may have little to no financial margin in their lives!

This is where financial education classes come into play! What better way to help those who are struggling financially than to offer classes on financial education and stewardship? Churches so often overlook this pervasive malady.

Approach to Developing a Stewardship Culture

• You’ve got to establish an ongoing dialogue around stewardship in your church. That includes sermons and small group discussion. Be intentional about creating stewardship terminology within you church.

  • For instance, from Andy’s book, Fields of Gold (http://www.amazon.com/Fields-Gold-Generous-Giving-Stanley/dp/0842385401) consider developing these terms:

    • Percentage giving

    • Priority giving

    • Progressive giving

  • Get everyone on board with the financial principle of: Give –> Safe –> Life.

    • Stewardship has both revenue and expense components

  • Revenue: develop a culture of generous giving within you congregation.

  • Expense: develop a culture of frugality among your staff.

    • In order to develop a culture of stewardship, you must:

  • Preach It (for more: see Tips on Preaching Stewardship).

  • Teach it (for more: see Tips on Teaching Stewardship).

  • Celebrate it (for more: see Tips on Celebrating Stewardship).

  • Apply it (for more: see Tips on Applying Stewardship).

     

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What else? Any more ideas on how to develop a culture of giving?

Why You Should Respond to a Large Donation

Don’t Miss the Chance to Connect and Discover!

In the previous blog, we talked about how to respond to a large donation. So, let’s talk about why you should respond to a large donation.

Here are the three reasons we believe you should always respond to a large donation:

1. Thank You! You simply don’t want to miss the opportunity to say thank you! If you are one of those church leaders who believe it’s better to not know your donor giving numbers, then you can have your bookkeeper tell you when a particular donor has given a substantial gift. Set a threshold and if any gift reaches that amount or higher, then ring the bell! In such case, you will know the gift was significant but at least you will not know the actual dollar amount of the gift.
2. Discovery! Something inspired the donor to make the large donation. Find outeverything you can on what motivated the donor to give by conversing with the donor (see out next blog: How to Respond to a Large Donation).
3. Connect! Again, something inspired the donor to make the large donation, so get to know this person! Even if the donor is a long-standing member of your church, it’s still important to re-connect with them. And listen, listen and listen to them because you want to find out why they were so inspired to give!

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What do you think? Should a church leader respond to a large donation?

How to Respond to a Large Donation

Don’t Miss the Chance to Connect!

One mega-church has a large donation policy and that policy is to notify the Senior Pastor whenever the church has received a gift of $20,000 or more.

Once notified, the Senior Pastor telephones the donor to personally thank him or her. In addition, the Senior Pastor asks the donor if he can delve a little deeper into what inspired the donor into making the gift.

If the donor is interested in talking, then the Pastor will ask a range of questions, such as:

• Was the gift motivated by any particular heart felt story?

• Is there any specific vision of the church that inspired the donor to give?

• What does the donor like about the church?

• Are there any areas that the donor thinks has a need for improvement?

• Does the donor have any particular desired use for those funds? Do you see what these questions are doing? The questions are creating a conversation, enabling the Pastor to connect with the donor.

These questions provide the Pastor with valuable insight and perspective.

Large donations are usually given by business leaders who attribute their success to having made wise decisions. And don’t forget, that large gift was a decision!

12 Channels in which to Communicate Giving

It’s About Moving the Giving Challenge to a Conversation

One of our goals at Local Church Finance is to help steer our clients away from making earnest pleas for financial support and toward making the concept of giving part of the daily conversation.

We believe that the more communication avenues you use, then the greater the awareness, and thus, the greater the conversation.

Here are 12 mediums in which to communicate giving. Find those mediums that you are underutilizing and start putting them to work for your church.

1. Video – Most churches have one or more video screens, and yet fail to use this great technology tool to communicate the impact of giving. For instance: consider videoing personal testimonials and then delivering these compelling stories on the screen. The audience is always rocked by personal testimonies. And then follow the testimonial by saying: once again, we just want to remind you that your giving is making a difference in the live of those in our community.

Consider videoing mission trips, high school trips and financial education classes. Tell personal stories from these activities and, again, always close by saying: once again, we just want to remind you that your giving is making a difference in the lives of those in our community.

People will never tire of hearing the stories of life’s being changed.

2. Hard Copy – Perhaps, the most common use of hard copy today is sending out tax donation letters. So many times, we see nothing on the back of the tax donation letters. Why not put a picture on the back of the letter and relate a personal story to the picture! And again, don’t forget to say: once again, we just want to remind you that your giving is making a difference.

3. Sermon Series – Consider delivering an annual sermon series on stewardship. The series can be a three, or four part series on stewardship and have only one of the series discussing the principle of tithing.

4. Story Telling @ Various Venues  – Tell stories at as many venues as possible. Begin each board meeting, church cookout, and event with a story. People remember stories much better than data. People identify with stories, i.e., they see themselves in these stories.

5. Thank You Letter to First-Time Donors – Develop a thank you letter system for first time donors. If you don’t develop a sound system, then you are going to fail to thank each new donor. On the back of the letter, place a photograph at the top and relate a personal story to the photograph. This way, you are utilizing both sides of the paper!

6. Train Leaders – Train leaders in the church on how to discuss the principles of giving to others in the church. If your church model is centered around community groups, then train all the community group leaders, at one time, on how to communicate giving to their groups. Similarly, if you church model is centered around adult Sunday school, then have train the leaders of these classes on how to communicate giving to their attendees.

7. Demonstrations – Consider demonstrating online giving during the offering time. It takes maybe a minute to make a gift online, so why not show your congregation how to make an online donation. Better yet, show you congregation how to make a recurring online donation and tell you congregation why recurring online donations really helps your church in budgeting ahead.

8. Donor Dinners – Consider holding a donor dinner for all of your monthly tithers. And yes, bring one or two new believers who can’t wait to tell their story of their new found hope and belief. End the dinner by giving them a heart-felt thank you for their long-standing support to the church.

Consider holding a donor dinner for all of those attendees who give only marginally. And yes again, bring one or two new believers to tell their story. Consider encouraging the audience to taking a financial stewardship class that you will soon be offering because many of the small donors may not have the financial margin in their life to give more to the church.

9. One-on-One Conversations – Sometimes, for various reasons, you have to have that the one-on-one conversation with a particular donor. It should never be difficult at all, particularly if you are equipped in how to present yourself and your message to the particular donor. Download here if you would like to receive more information on how to make the one-on-one presentation.

10. Electronic Publishing – Remember all these personal stories that we keep pushing? Simply convert them from print to electronic newsletters.

11. Conversation: Small Audience – Don’t pass on the opportunity when you are speaking to just the leaders of your church. This is an opportune time for you to simply thank them for their financial generosity. Again, try to attach a story to the thank you message. Thanking the leaders of one’s church is so often overlooked.

12. Conversation: Large Audience – Oftentimes, the giving conversation with a larger audience will be quite different than the giving conversation with a smaller audience. But remember, the giving conversation does not need to happen only during the worship service. Share a story and a thank you before every event and gathering.

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What else? Do any more channels come to mind that we missed? Can you add more to any of the channels we provided?

4 Ways to Collect Donations

Do You See What’s Happening before Our Eyes?

Ok, you are well aware of these 4 ways to collect donations, right? The bigger question is whether or not you are aware of the trend that is taking place and what are your doing about it?

Let’s touch on each collection process:

1. Collection Plate – This is the tried and true method of collecting most donations, but it’s slowly, but surely, going the way of the dinosaur. If you don’t believe us, then please read the post: Why Electronic Checks Trump Manual Checks.

2. Snail Mail – Somewhere between 5 and 15% of the manual checks that don’t make the Sunday collection plate, end up getting mailed in to your church.

3. Electronic Deposit – This is how all money derived from online giving, giving kiosks and telephone giving apps is collected. This is how Generation X and Generation Y are making their donations. They are not writing manual checks and placing them in the offering plate! They don’t even know what a manual check looks like!!!

4. Funds / Stock Transfer – This is the most obscure collection process; however, it is the only process available for a donor who desires to give public securities to a church. That is, a church must have its own brokerage account in order to effectively receive a public security.

Here are the trends we are seeing:

• Online giving is steadily increasing each year. Most churches are seeing at least 30% of their giving coming from online giving. Whereas, some churches are experiencing online giving as high as 50% of total giving. (Amazingly, we see some churches that still don’t offer online giving).

• Telephone app giving is the next up and coming technology offering. Your bank must provide the technology in order for you to offer telephone app giving. Telephone app giving is amazing because it allows the donor to make a donation in the moment.

9 Ways to Make Donations

And the Importance of Recognizing the Slow and Certain Death of Manual Checks

In this blog, we will be discussing 9 ways a person can make a donation to your church. We’ll start with the oldest, most traditional, ways of giving and move to the new, evolving ways of giving. Finally, we’ll touch on the importance of understanding the trend that is developing right before our eyes.

1. Cash – Most companies would kill to be paid in cash; however, that’s not the case with churches. Cash in the collection plate can’t be credited to any one donor or donors. Committed donors know that their gifts are tax deductible and therefore, some sort of transaction trail must be established in order to substantiate their donation claims. No such transaction trail will be established by dropping dollar bills in the collection plate.

2. Manual Checks – Manual checks have been the main staple for making donations for the last century. 90% of the manual check writers drop their donations in the offering plate, while the remaining 10% snail mail their donations to the church. Manual checks are more likely to originate from the Baby Boom generation, those born between the mid 1940’s and the mid 1960’s.

3. Pledge Cards

4. Electronic Checks – Electronic checks come in two varieties: a) those originating via Internet banking portals and b) those originating via accounting software technology. Unlike manual checks, electronic checks can be set up to be recurring in nature, and that is obviously huge for your church.

Electronic checks are more likely to originate from the Generation X’ers (those born between the mid 1960’s to the mid 1980’s) and the Generation Y’ers (those born between the mid 1980’s and the mid 2000’s). Generation X and Generation Y are computer savvy and they are all about typing on their computer and mobile device. Any form of handwriting for them is considered sinful!

5. Online Giving (ACH) – ACH stands for automated clearing house. An ACH transaction is simply a manual check that is electronically written over the Internet via an online giving page on your church’s website.

6. Online Giving (Credit Cards) – Many churches offer credit card payment ability on the online giving page of their website. Other churches shy away from offering credit card payment because they don’t want to encourage the potential for incurring more personal debt.

7. Online Giving (Debit Cards) – Credit card merchant services now incorporate debit card services. As such, if a church offers credit card payments, then they will also be offering debit card payments as well.

8. Giving Kiosks are essentially ATM machines in reverse. Churches strategically position Giving Kiosks within their facilities, making it real easy for an attendee or member to step up to the plate to make a gift.

9. Telephone Apps – Telephone Apps are the naturally offspring of the online giving solution, the texting craze and the rise of the smart phone. So instead of opening one’s computer and going online to make a gift, the donor simply pulls his her smart phone out of the pocket and goes to the giving app to initiate the gift. As such, a donor can make a donation at anytime during and/or or after the worship service or church event.

As previously mentioned, the younger generations, notably the Generation X’ers and the Generation Y’ers, are sophisticated computer users and as a result, they are handling all of their financial transactions electronically, via their personal computer and smart phone. Many of the X’ers and Y’ers don’t even possess manual checks!

As such, if your electronic giving is not growing, then that’s proof positive that the younger generation is not walking into your church. As a matter of fact, one doesn’t need to see a congregation in order to determine the congregation’s average age. Rather, one only needs to analyze the giving mechanisms.

The time is steadily approaching where the passing of the offering plate will be rendered obsolete.

10 Keys to Maximizing Online Giving

Most churches are seeing at least 35% of their revenue coming from online giving. That’s a significant percentage! …and the trend is only going to rise over time.

Keep in mind that most Generation X’ers and all of the budding Millennial generations never knew what life was like before the computer and they use their computer for everything: including writing checks. Even the older Baby Boomers are recognizing the benefit and ease of online giving.

So, in order to stay relevant, here are 10 keys to help you foster and improve the online experience for your donors:

1. Make Your Online Giving Ridiculously Easy and Accessible to Use.

Do your website visitors need to go looking for the GIVE tab? Make sure that your online giving page is front and center! Your GIVE tab really needs to be on the top navigation bar on every page of your site, like this:

So, at no point is a website visitor more than one click away from being able to make a donation. And once your visitor hits the GIVE tab, do not make them scroll down to find the ONLINE GIVING tab. Rather, make the ONLINE GIVING tab big and fat and the first thing they see!

2. Pay Attention to the Language You Use

Make sure that you are as clear and concise as possible in the language of your navigation. (GIVE is probably a better word to use than SUPPORT, DONATE, TITHE, etc.)

3. Carefully Balance the Giving Options

Offer the essential options for giving and be carefully about offering too many options. Too many options may actually run people off from giving altogether. Some essential options to offer are: one-time donations, recurring donations and ACH. The key option is a recurring donation, that’s the BIG WIN for your church.

4. Carefully Balance the Log-in Requirements

Be sure to require as few log-ins and special steps as possible without sacrificing the security of your system.

5. Provide a Point of Contact on Your Giving Page

Most church websites offer direct contacts to those people who run the various programs / environments. Fewer churches offer a direct contact for answering financial matters. And so there could be lost opportunities. Consider, offering a direct contact to the business manager and be sure to provide both his / her email address and phone number.

6. Include a Link to Online Giving in All of Your Print and Digital Communication Channels

Include an online giving link in all emails, newsletters, and other print and digital communications. You must drive people to your online giving page when they are ready to give. What may seem like overkill to you, as a leader, is often very helpful to the giver.

7. Be Careful not to Spam Your Members with Overt Online Giving Appeals

Find a balance between making sure people know where to give online and overwhelming your donors with too many emails and other correspondence. Consider including an easily noticeable link to online giving when your members log into your private online community (assuming you have one).

8. Make Online Giving Meaningful

On the Giving Page, include written testimonials and even video to tell the story of how one’s giving is making a difference in the lives of other people.

9. Inform People about Alternative Giving Options

Communicate other ways people can donate if they don’t want to give online. Provide the church address, phone number, and even a text to donate number. Include a note about non-cash giving and how a giver can initiate that process. While this may not affect a broad section of your givers, it can facilitate large gifts from your high-capacity givers.

10. Incorporate Online Giving During the Worship Service Offering Message

Don’t forget to thank those who gave online when you take up the offering on Sundays.

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Local Church Finance wants to help you increase your online giving donations. Let the Local Church Finance team help you implement these proven strategies and tactics today!

5 Ways to Increase Giving Awareness

It’s All About Connecting with Your Donors

What are the best ways to increase giving awareness in your church? Here’s what we believe:

1)   Tell Stories

• People remember stories. Take a moment and try to remember a compelling story of a person giving their life to Christ. Reflect on the details of the story. Are you surprised at the amount of recall you have?

• People relate to stories. We all have our trials in life. Trials are a fundamental component of the human experience. People who have experienced our same struggles…they are like kinfolk to us!

• Stories are emotional. What about people finding eternal purpose in their life, who were previously lost? These stories leave us in tears.

• Stories honor God. Life changes starts with the spirit of God coming to

2)   Provide Statistics (Data)

• Most people don’t remember data.

• Stats are.. static. No pun intended.

• However, statistics give validity to stories, so be sure to wrap statistics around great stories.

• Statistics are great at reminding us of the total impact.

3)   Recite Scripture

• Scripture supports giving.

• Scripture instructs us on how to give.

• Scripture is a fairly reliable source!

4)   Celebrate Wins

• Celebrating wins gives recognition to God. Specifically, it reminds us that God has come through with His provisions for us.

• Celebrating wins is actually a form of worship.

• Celebrating wins revitalizes us. It provides necessary recharging in us before we take on the next challenge.

• In our experience, celebrating tends to be greatly overlooked and thus underutilized.

5)   Demonstrate

• In the book, Influencer: The Power to Change Anything, the authors contend that one of the most effective ways to effect change in human behavior, is to demonstrate to people on how to make a change in their life.

• Consider demonstrating the process of making an online donation to your congregation or to a particular group in your church.

• Similar to celebrating, demonstrating is overlooked if not non-existent.

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What else? What others ways do you know to increase giving awareness? Please let us know because any and all new idea that help increase giving awareness is, indeed, a great idea!

How Tiered Services Saves you Money

The Local Church Finance Model

How Utilizing Tiered Services Saves You Money and Improves Quality

At Local Church Finance, you are not hiring a person, you are hiring a team. This team will consist of a CFO-level manager, a Controller-level supervisor, and at least one bookkeeper.

Here are the primary ways you can save money with the Local Church Finance model:

• Our bookkeepers are highly trained and supervised. As such, our bookkeepers are the equivalent of most accountants in other churches.

• The Controller level and CFO level work is always critical to your church.  Without the professional oversight of this work, your church will suffer in more ways than just financially.

• Having a three-position team ensures that no one person will ever be operating outside his/her skill set and level of understanding and competency.

Let us explain in more detail:

Most of the work for your church will be performed at the bookkeeper level.  The bookkeeper will perform all of the clerical work necessary for recording transactions, such as recording and paying bills, depositing donations recording donor information into the donor database, and reconciling bank statements.

75% to 85% of the financial operations workload of your church is conducted at the bookkeeper level. 

The Controller level work includes reviewing the work of the bookkeepers, designing and maintaining the bookkeeping system, and troubleshooting complex financial transactions.

10% to 15% of the financial operation workload of your church is conducted at the Controller level.

The CFO level work includes assisting the Controller in any and all areas that the Controller needs assistance; communicating with bankers, board members and the like; preparing monthly financial reports for management; and contacting preferred vendors for better services and cost savings.

5% to 10% of the financial operations workload of your church is conducted at the CFO level.

As you can see, significantly more work time is spent at the bookkeeping level than at either the Controller level or CFO level. However, that should never rule out the critical need of having professional accounting supervision at all times. Frankly speaking, an unsupervised bookkeeper is a dangerous proposition for your church. Complex transactions should never be solved by the bookkeeper.

Below is a breakdown of the work levels:

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Local Church Finance finds ways to save you money.  Let Local Church Finance manage your financial operations at the CFO level, supervise the bookkeeping at the Controller level, and maintain your financial records at the bookkeeping level. By adopting the Local Church Finance model, there will never be any under-utilization of your employees.