The Healthy Church Staff Podcast
We're all about helping create a healthy, positive, and spiritually positive environment for church staff members and leadership teams.
The Healthy Church Staff Podcast
Budget Smarts: How to Afford Your Next Staff Member
Ever wondered how your church could better allocate its budget to truly reflect and support its mission? Join me, Todd Rhoades, on the Healthy Church Staff Podcast, where we unravel effective budgeting strategies for hiring church staff. We'll dive into why staffing should be seen as an investment rather than an expense, and I promise you'll gain insights on allocating 45-55% of your church's total budget to personnel. We’ll tackle the challenge of tight budgets by exploring the importance of aligning spending with ministry goals, considering costs beyond salaries, and implementing creative funding solutions like designated giving and restructuring roles.
This episode isn’t just about numbers; it's about fostering a community that grows together. I invite you to share your stories and challenges as we navigate this ongoing journey of making thoughtful staffing decisions. Together, let’s ensure that every choice contributes to your church’s future and mission to serve the community. Whether you’re from a small rural church or a bustling suburban congregation, this conversation is your guide to strategic and mission-aligned staffing decisions. Listen in, and let's embark on a path that ensures your church thrives through collaboration and informed decision-making.
Have questions or comments? Send to podcast@chemistrystaffing.com
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Is Your Church Hiring?
If your church is searching for a new staff member, reach out to Todd for a conversation on how he might be able to help.
Are You Looking for a New Ministry Role?
If you are open to a new church role in the next few months, add your free resume and profile at ChemistryStaffing.com.
Hi there, welcome to the Healthy Church Staff Podcast. I'm Todd Rhodes, one of the co-founders over at Chemistry Staffing and your guide and host here today on the Healthy Church Staff Podcast. We are in the middle of a series. We just started it yesterday. It's the middle of December December and a lot of churches are figuring out their budgets and what they're going to do with staffing and hiring for 2025. So I wanted to do a little bit of a series, and today we're talking about budget smarts how to afford your next staffing member. Now I know we're tackling a topic that keeps a lot of church leaders up at night how we need to hire somebody new, but how do we afford it? Budgets can feel like they're just a never-ending balancing act and the idea of just adding one more salary to the mix. It's enough to make anybody nervous. But here's the thing Staffing isn't just an expense, it's an investment. Now, you would expect somebody from a staffing firm to say that, but like any good investment, staffing does require a plan. I see way too many churches that don't really have a plan for staffing, and particularly when you're adding a new person and a new annual salary to your budget. So let's talk about that today. How do you budget smartly for your next hire without breaking the bank? Let's start here.
Speaker 1:Let's talk about the elephant in the room. We already mentioned it. Right, the problem is money a lot of times, right, money is tight for most churches. I just saw a study today that said that overall giving and philanthropy in the United States is on a downward trend. So, whether you're in a small rural church with 80 people or a larger suburban church with 800, 1,000, 5,000 people, you know what there's usually more vision than there is budget. That's just the reality. But it doesn't mean that hiring is out of reach. It just means that you really need to have a plan and be strategic. So let's start here.
Speaker 1:Let's start with your personnel budget. First of all, let's talk numbers for a second. Okay, a good rule of thumb and according to who you talk to, they're going to give you different numbers, but every bit of research I've seen a good rule of thumb is to allocate between 45 and 55 percent of your church's total budget to personnel. Now, that includes salary and benefits and taxes, the whole package. Now, I'm not saying that's where your church should be. That's what I'm saying is that's where most churches find themselves.
Speaker 1:Now, if you're already over that percentage, seriously it might be time to re, to reevaluate your overall budget priorities. But here's the catch, and the research won't tell you this. Okay, but I will, because this time I'm being honest with you. Okay, percentages don't tell the whole story. Okay, you have to look at the needs of your church. If you're a small church with one full-time pastor, 60% of your budget going to personnel might be completely appropriate. The key really here is to match your spending with your ministry goals. So the first thing you want to do is look at that personnel budget. Where are you on that percentage? If you don't know the percentage, that's where you need to start.
Speaker 1:And then the second thing I would encourage you to do would be think beyond salary. When you're budgeting for a new hire, it's not just about the salary. We talked about money. It is about salary, right, but you've got to account for benefits and professional development and even onboarding costs, and it's easy to forget these extras, but they will add up quickly. So it's not just the salary, it's salary plus, okay. So here's a practical example If you're going to hire a worship pastor for, let's say, $50,000 a year salary, you might need to budget an additional 20 or 25% for things like health insurance and retirement contributions and professional development. So you're all in. I mean, your $50,000 hire might actually cost you closer to $60,000. Matter of fact, if you're including benefits like health insurance, it absolutely will no doubt about it. So think beyond the salary. And then the third thing I would like you three out of four things here today find some creative funding solutions. All right, now, let's get creative. Okay, if your current budget doesn't have room for a new hire, but you really feel after listening to yesterday's podcast, you really feel like man, we've got to move forward. We've got to move forward with another hire.
Speaker 1:Consider some options. The first thing could be a designated giving. Invite your congregation to give specifically toward a new staff role. People love to contribute when they see a clear vision and a purpose behind it, and what I often tell search teams and boards and elder boards is that, quite honestly, in most churches not every church, but most churches there is probably an individual that could front, with a donation, probably two years salary for a new staff member. Seriously, you probably know who that person is, people that have means, love to give to a cause and if they know that there's a need and you can paint that need and make the ask. That could very well be a big part of your budget issue when hiring a new staff member.
Speaker 1:Second, you might need to restructure some existing roles. Can you combine some part-time roles into a full-time position or maybe shift some responsibilities to free up some resources? That's a possibility. Maybe you phase in the role, maybe you start with a part-time position. I'm seeing a lot of churches do this and quite frankly, I don't think it's a bad idea. Start with a part-time hire and gradually increase hours as your budget allows. Now this is going to probably cause you to have to hire somebody locally because no one will move to your church for a part-time salary. Some people will, but most people won't. But it's especially helpful if you're hiring for a brand new position and then another way to find some money is just by cutting some non-essentials.
Speaker 1:Take a hard look at your budget. We're doing this with Doge right now, with the national government. They are looking at all of the things in the budget and finding waste. Every government has waste, for sure, but most churches have a little bit here that you can move around a little bit. Are there programs or expenses that aren't producing fruit. Maybe you redirect some of those towards staffing.
Speaker 1:And the fourth thing I'd like you to consider is the cost of not hiring. Very few people think about this. But flip the script for just a second. What happens if you don't make this hire? If you don't hire a new person and we talked about some of the ramifications and consequences of this yesterday Go back and listen to the podcast yesterday. I think you'll really enjoy it. But if you need to make a hire and you don't, your burnout will increase among your current team, your ministry effectiveness will decrease it's just a given and your growth will slow or worse, you'll either plateau or decline. So sometimes the cost of not hiring is even far greater than the financial investment of needing bringing somebody on board. So here's your action step for today.
Speaker 1:Okay, take a look at your church's budget. If you don't know what that number is, what that percentage is of your total church budget that you're spending on personnel, find that out. If you're under 45%, you might have a little bit more wiggle room than you think. If you're over 55%, it's probably time to ask some tough questions about where your money's going and whether your staffing is really aligned with your mission. So consider reaching out to a trusted financial advisor, a church consultant.
Speaker 1:Reach out to me. You can reach out to me anytime. I do this with churches all day, every day, a lot of times. Feel free to reach out to me. Podcast at chemistrystaffingcom. Podcast at chemistrystaffingcom. Sometimes, just a fresh set of eyes can uncover opportunities that you didn't even know were there. And I know that budgeting can feel overwhelming, but you don't have to figure it out alone. If you're thinking about hiring but you're unsure about how to make it work financially, let's chat. Shoot me an email Again. Podcast at chemistrystaffingcom.
Speaker 1:I'd love to help you think through whatever you're doing. Don't worry, I'm not a salesy guy, I'm not a high pressure guy. So I'd love to hear your story, hear what you're thinking, and give you some input. And hey, if God would have us to work together in the future, I would absolutely love it. All right, thanks for hanging out with me today. Remember, staffing isn't just a line item in your budget. It's a way to invest in the future of your church and in the people that you're called to serve. You've got this and I'm here to help, however I can. All right, thanks, we'll talk to you again tomorrow on the Healthy Church Staff Podcast. You.
