By Jim Burnett
Most pastors don’t go into ministry for the money—and it shows. The mishandling of personal finances is one of the greatest pitfalls for pastors today.
In training for the ministry, pastors learn how to exegete a passage of Scripture but not how to live on a budget. They master the discipline of sermon preparation but not the discipline of investing for retirement. They excel in biblical linguistics but don’t know the difference between Roth and traditional IRAs.
As a result, many ministers lose their leadership influence through poor financial decisions. Their lack of exposure to business principles and money management puts them at a disadvantage not only with their personal finances but also in managing church finances.
If that’s your situation, consider taking a basic business class that will teach you some fundamentals. If that’s not possible, enlist the help of a business professional in your church to teach you what you need to know.
Live within your means
Lack of knowledge and poor money management often lead to overspending and sometimes bankruptcy. Frequently, it’s not lack of income that poses the problem for a minister’s household but the lack of discipline in saving portions of the income, which often leads to debilitating debt.
The Bible clearly teaches full-time ministers should be compensated—the worker is worthy of his wages (1 Timothy 5:17-18). But you’re responsible for being a good financial steward in ministry and at home. If you don’t already have a family budget, January is the perfect time to have a family business meeting and set a budget for the year. A realistic budget should be the foundation for all your financial decisions.
Be faithful in your giving
Make sure you’re a person of integrity when it comes to supporting your church through your giving. I’ve found not all ministerial staff feel the need to give generously and support their church financially. What often looks like a financial problem is in reality more of a faith problem.
If you haven’t been faithful in giving to your church, begin doing so immediately. Confess it to your leadership and challenge each one of them to do likewise.
Invest for your retirement
Finally, make sure you’re being a good steward by investing for retirement. Solomon admonishes in Proverbs 6:6-8 to learn from the ant the wisdom of gathering food in the summer in preparing for the winter months. Ministers need to be as smart as the ant.
Yet even pastors who are saving for retirement may not be saving enough, says Joel Rister, director of denominational business services at GuideStone, a benefits provider for evangelical churches and ministries.
The average balance in ministers’ retirement savings is less than half the typical balance for workers in the for-profit world, Rister said. “We’re behind the curve compared to persons in the secular world who are saving.”
Today there are some wonderful opportunities to put aside money that will be tax-free when you retire. Through a Roth IRA you can invest up to $5,500 per year, or up to $6,500 if you are 50 or older. Another wonderful retirement tool is a tax-deferred annuity. Financial entities like GuideStone have wise representatives who can help you consider your options.
Don’t rely on others to take care of you in your retirement. Use discernment, discipline, and wisdom today so you’ll have what you need for the future. Set up an automatic withdrawal from your checking account and take out a little each month to invest in IRAs and annuities. As you reach those retirement years, you can do so with confidence because you put your financial house in order.
JIM BURNETT is pastor of Willow Pointe Church in Hattiesburg, Mississippi.