You are ready to build your dream team. You know the value of vetting character, culture, and competence. You have a good idea of the team members that you need to carry out your mission. But how can you know what you can afford to spend on staffing for your church?
Here is a simple way to answer this question and a plan to allocate church dollars best.
Between Justin and Brian (our founders and owners), we have a combined 50 years of full-time experience in local church ministry. We suggest these five major budget categories and percentages for most churches. You can adjust the percentages based on your context and commitments, but remember that if you spend more in one category, you must spend less in another.
Budget Category 1: Operations - 20% of Total Budget
Operations (affectionately) refers to the boring stuff that churches need to spend resources on to thrive. Rent, Building payment, Utilities, insurance, Supplies, and anything else that has more to do with admin than people.
Budget Category 2: Missions - 10% of Total Budget
Missions refers to everything that is outward. Missions includes Global missions, Local missions, Mercy Ministries, Church Planting, etc.
Budget Category 3: Ministries - 10% of Total Budget
Ministries refers to everything that is designed to facilitate community or equip believers. Ministries refers to Youth Ministries, Small Groups, Men's Ministries, Women's Ministries, Children's Ministries, Staff ministry expenses, etc.
Budget Category 4: Savings - 5% of Total Budget
Every church should be saving money—even church plants. We budget for savings because it is wise and responsible to have a buffer and an Opportunity Fund.
OK. We're finally there.
Budget Category 5: Your Paid Team - 55% of Total Budget
A good guideline for your paid team (including your compensation) is 55% of your total budget. This number will likely flex a few points in different seasons in one direction or another. When you get above 60% in paid staffing, you are at the top end, and when you get down into the forties, you may be able to spend a bit more. This 55% includes salaries, health insurance, retirement, etc.
Here is one piece of mathematical advice: Make sure that the above five categories add up to 100%! We've seen a few church leaders end up with a number that adds up to 120%. Don't be that guy.
And remember, We started Context Staffing to help you find the right leader. We specialize in finding leaders for churches. Our team spends hundreds of hours searching, recruiting, and vetting potential leaders for your church so that you can confidently build your dream team.