Download the How to manage church finances: 10 best practices every pastor should know
Fill out the form below to schedule a demo or call our sales team at
469-564-3922
A well-managed church budget doesn’t just keep the lights on—it helps lay the foundation for gospel-centered work. When handled with wisdom and care, church finances can empower ministry, fuel outreach, and sustain a thriving church community.
Having a solid understanding of church finances is essential to maintaining the overall health of any church. A leadership team’s ability to fulfill their mission is deeply connected to how well they steward resources and manage their church’s funds. When done correctly, churches can use their finances to reach more people, make more disciples, and have a greater impact on their communities!
Let’s take a look at ten simple church accounting practices that will help you learn the basics of how to manage church finances, while also promoting biblical stewardship among your team.
One of the first steps for managing your church’s finances is to map out your current expenses. As Benjamin Franklin wisely said, “Beware of little expenses. A small leak will sink a great ship.” Tracking your costs carefully lays the groundwork for accurate church financial statements and better budgeting decisions.
With the help of church financial software, start by listing out all of your operating expenses. These include items such as:
The donations, gifts, and any other contributions your church receives make up their annual income. Most income comes from donations in the form of cash, checks, and online giving. Other donations to track include fundraising campaigns, stocks, securities, and non-cash contributions such as household items and vehicles.
Fortunately, the trend of accepting online donations and using simple church accounting software has streamlined the process for managing church funds efficiently!
The best online giving solutions, such as Subsplash Giving, automatically record your incoming donations and allow you to easily generate giving reports. They also allow you to accept and track payments for non-charitable transactions, such as event tickets or merchandise—helping you maintain a full picture of all church funds being received.
Based on your historical expenses and contributions, you can begin the process of projecting your church’s future income. When making your projection, pay close attention to patterns in your attendance and giving. This is a key step for creating sustainable church finances over time.
A good financial practice is to err on the side of caution when projecting revenue. Be realistic with your estimates. You should also encourage your donors to set up recurring gifts through your online giving provider. This allows them to schedule their regular tithes and offerings, giving your church access to more accurate data about future income!
Your church’s budget should be based on expenses and projected income, but it should also be driven by your vision and goals. Use your projected income as the base to allocate funds to different ministries to reach individual and collective goals.
One place to start is asking each ministry department leader—like your missions director or youth pastor—to submit their own department budget based on their goals, needs, and resources. It’s important not to assume that your staff and other leaders understand how to create budgets, so provide financial training for your team!
Doing this allows your leadership team to take ownership of their budget and better understand the impact of their financial decisions—a crucial aspect of responsible church financing—rather than just simply administering a handed-down budget.
If your church doesn’t already offer online giving, now is the perfect time to start! Studies show that adding an online giving solution dramatically increases overall giving by an average of 32%!
Donors appreciate the convenience and security of online giving through their church’s mobile app or website, as well as text-to-give. They can also easily view their online donations and download their end-of-year giving statements.
For your church finance team, online giving simplifies administrative tasks, such as sending out giving statements or pulling church financial reports. It also helps your church anticipate future donations through regular recurring giving.
Even with thoughtful planning, every church faces financial surprises at some point. A major repair, a sudden drop in giving, or an unexpected ministry opportunity can strain church finances without warning.
This is why finance experts suggest creating an emergency fund equal to three to six months of typical expenses. You’ll also want to clearly define what kind of situation constitutes an emergency in order to protect this cash reserve from being used for non-emergency purposes.
A healthy emergency fund doesn’t just protect your church from short-term disruption—it empowers leadership to make decisions with greater clarity and confidence. Rather than reacting out of financial stress, pastors and their boards can focus on ministry opportunities, knowing the church has a buffer in place.
When not fully used, this reserve fund can increase annually and help protect your church from budget shortfalls. It also signals to your congregation and community that your church manages church funds with wisdom and foresight, fostering greater trust.
A church’s financial committee is usually made up of members who were assigned or elected to steward the church’s financial resources. They’re responsible for ensuring that the church’s finances are being handled responsibly, ethically, and in alignment with the church’s vision.
Oversight is a critical component of church financing, ensuring financial decisions are made with integrity and accountability. Part of this responsibility should include creating a written oversight policy that includes a…
By establishing these procedures, you not only strengthen church financing practices but also protect your church from financial mismanagement and potential fraud.
Being good stewards of your church’s finances requires creating regular church financial reports for the finance committee. These reports should be presented each quarter and should be written in a way that is easily understood.
Church leaders should also have access to review these reports and ask questions if something seems amiss. This transparency is central for managing church finances responsibly.
For example, an incredible 80% of church fraud cases go unreported every year! Financial reports and reviews are key safeguards against theft, fraud, and embezzlement. Any concerns that are raised should enact oversight policy procedures to ensure accuracy and accountability.
Many churches take on debt throughout their lifetimes for a variety of reasons—to help when getting started, to allow them to grow and expand, or simply to keep the church open and operating. But long-term or growing debt cripples a church’s ability to effectively reach their goals.
This is why it’s important to have a strategy for paying down church debt. This should include dedicating a portion of the annual budget to debt reduction, as well as planning capital campaigns.
Utilizing simple church accounting software and establishing best practices enables your church to be debt-free, empowering you to explore new growth opportunities and increase your ability to impact your communities in positive and practical ways.
Today’s church donors expect transparency and accountability, and they appreciate understanding how their contributions are impacting their communities. At the end of each calendar year, hold a meeting with your congregation to:
Talking about money and finances is not always easy to do, but the reality is that your church’s finances are a critical part of being able to fulfill your unique mission. Understanding where your church is financially, following the above best practices, and sharing your accomplishments goes a long way in encouraging donors to give to your church!
Every church has a story to tell. From your mission statement to your history, there are many stories and testimonies woven into your church’s DNA. But what does your church’s “generosity story” look like?
Invite your elders, ministry leaders, or finance team to come together and write a “generosity story” for your church. Start by asking:
By intentionally piecing together these stories of impact, you can celebrate where God has worked in the past and have faith for where He is calling you to invest in the future.
Churches are places of worship, community, and transformation—but behind every thriving ministry is the practical need for sound financial stewardship. Healthy church finances are not just about balancing budgets—they’re about aligning resources with God’s mission, building trust with congregants, and ensuring sustainability for generations to come.
.webp)
© 2025 Subsplash
