From Donations to Diversified Income
This is part 3 of our four part series on “Four Changes Your Church Needs to Make Right Now.”
Much of this blog post is drawn from recommendations and principles laid out in DeYmaz, Mark. The Coming Revolution in Church Economics: Why Tithes and Offerings Are No Longer Enough, and What You Can Do about It. Baker Books, 2019.
A crucial need arising is for churches to diversify their income sources.
Challenges Facing Congregations:
Shrinking Middle Class and Decline in Wealth: The middle class, once a robust pillar of financial support, now faces declining wealth. Congregations must swiftly adapt for financial sustainability, leveraging creative solutions to weather economic changes effectively.
Shifting Philanthropic Priorities: Changes in philanthropic trends signal a need for congregations to evolve beyond traditional giving avenues. Adapting to evolving philanthropy is not merely a choice but a necessity for thriving in the contemporary landscape.
Generational Shift in Giving: Transitioning from builder and boomer generations to Gen X and younger introduces a shift in giving preferences. Churches must align fundraising with causes that resonate with the younger demographic, fostering a connection that transcends generational divides.
Decline in Worship Attendance: Decreasing attendance poses financial challenges as traditional revenue sources diminish. Congregations must actively explore new avenues to ensure financial stability amid changing attendance patterns.
Possibilities for Diversifying Income:
Investing Surplus Cash:
Rather than letting surplus funds sit idle, congregations can explore responsible investment opportunities. Ethical and sustainable investments not only align with the church's values but also have the potential to generate additional income.
Renting Space Legally and Aligned with Mission:
Optimizing physical space by renting it out legally can include hosting community events or collaborating with local businesses aligned with the church's mission.
Starting Businesses:
Initiating ventures such as coffee shops, bookstores, or massage therapy studios provides financial returns and creates community hubs, serving as platforms for outreach and connection.
Teaching and Monetizing Experiences:
Congregations can leverage their expertise by offering classes or workshops, monetizing unique experiences like guided tours to attract diverse audiences and generate income.
Benefits of Diversification:
Relating Better to Members—Diversified congregations mirror members' economic realities, enhancing the church's relevance and connection with the community.
Financial Resilience: Diversification builds financial resilience, mitigating the impact of economic fluctuations or changes in giving patterns. A diversified income portfolio provides stability and adaptability.
Enhanced Community Engagement: Venturing into diverse income-generating activities naturally embeds congregations in their communities, fostering stronger relationships and opening doors for mission-driven outreach.
In navigating today's complexities, congregations are called to be proactive stewards of their resources. Diversifying income not only addresses financial challenges but also positions churches to thrive in an ever-changing world. As we embrace innovative approaches, let us be inspired by the timeless mission of our congregations and the profound impact they can have on the communities they serve. Together, through diversified efforts, we can ensure a sustainable future for congregational ministry.