Ten Things the Government Needs to Learn About Budgeting That I Learned From Running a Church

Here we are again. It’s crunch time and the politicians are making a big fuss about the budget. Democrats blame the Republicans, Republicans blame the Democrats, the sky is blue, grass is green… Such is life.



In the past two years, I have become the Senior Pastor at a small church here in Phoenix. As a youth pastor for years, I never had to worry much about the budget, the elders and Senior Pastor did that. Now, it’s my job and I’ve learned that it is harder than I ever realized. Running a church is really just running a small business from a financial point of view*. Running a Government is no different from running a small business, either, just a matter of scale.


I’m still trying to get my mind around all of the issues of the business side of church, but here are some lessons I’ve learned that might just help Congress.


1. It’s easy to nickel and dime your way to deficit spending.


Most of the issues I’ve encountered when it comes to going over budget aren’t about the big expenses. Yes, occasionally an AC compressor will give out in July or an irrigation accident will destroy a neighbor’s yard and require repair, but the truth is, it’s all the little expenses here and there that build up. Paper is $35 a case. Toner is $120 a cartridge. We chose to print a hundred of those posters and suddenly, we are over budget. Workday projects, repairs, and maintenance always cost twice what you expected and necessitate three trips to Home Depot. Whoops, we did it again. This is what makes budgeting so hard, because $28 here and $55 there doesn’t sound like much until you do it too many times.






2. It’s easier to spend when it’s someone else’s money


My family is all about debt-free living. We don’t use credit cards, we don’t get car loans, and we try very hard to consider our expenses so we don’t overspend. However, when it comes to making choices of what to buy or not to buy at work, it’s easier to think, “Oh, we’ll just move the money over from another area to cover it,” or, “This item is on sale and we’ll surely use it someday, so we’ll go ahead and buy it now and replenish the fund later.” The problem is: it’s much easier to be brutally realistic about finances when you are talking about paying the rent to keep the roof over your head and paying the electric bill to keep your own lights on.



3. You don’t reduce the deficit, cut it entirely and work on paying off debt.


My earliest recollection of politics comes from the budget fights of the early eighties. I remember the politicians saying, time and time again, “We must cut the deficit.” Even as a teenager, that sounded very weird. I wasn’t even good at math, but I knew that a negative is a negative whether it was $1000 or $1 billion dollars. That’s like trying to dig yourself out of a hole by using a trowel instead of a spade. Either way, you’re still digging a deeper hole. Nope, you gotta learn to live within your means and NEVER spend in the negative.






4. There’s always a bunch of good things to do with the money, but not always a bunch of money to do good things with.


Church is all about this. There’s always someone who has a ministry need. The homeless need fed. The orphans need shoes. People in Africa need medicine. People in Japan just had a natural disaster. Poor families need Christmas presents. Missionaries need sent. Tots need toys. Trees need angels. Drives need canned food. On and on and on and on. All of these are good things, and all cost money. The simple truth is we just cannot do them all. We have to say, “No,” to some of them. That hurts, that’s difficult, and that’s absolutely necessary.


5. Look at your priorities.


Yup, that’s what this comes down to. Prioritizing. Sounds easy, right? List all your bills in order of urgency. Begin dividing up your money to pay for those. Then, create a rainy day fund and put a good percentage of money into that account to cover unforeseen problems. Then, if (IF) there is money left over, begin adding those things you want to do in priority order. Parcel out any remaining funds for those items until you run out of money. Then, say, “I’m Sorry,” to the rest of the items.






6. Consider other options to pay for things.


So, there are good things leftover from your list (see items 4 & 5 above). Gosh, there is one of them that you really, really want to do. It’s such a good idea, but we just don’t have the money in the budget for it. Great. Let’s do it. Here’s how: go to the people and sell it to them. Tell them what a great idea it is and why we should do it. If they’re on board, then they’ll help pay for it. If not, then back to the drawing board. What other ways might we fundraise for this? Who else can we get behind this idea that might help? Where else can we cut or where else can we earn the money to make it happen? What if the church as a whole doesn’t provide for it, but individuals within the church who are passionate about it get creative and make it work?


This leads us to an especially important message for the American People and our Silly Politicians. Are you ready… Wait for it…


The Government is not the only one who can provide money for good things to happen! Whoa! Step Back! You mean that private investors can do charity? You mean that churches and community groups can be responsible for some of this stuff? You mean families can actually help each other? You mean communities can get together and make something work? All of this without our Mommy the Government doing it for us?


Abso-stinkin-lutely!



7. Good stewardship matters for good character.


I know you may not believe it, but church is not about money. Our message is one of hope and truth. We point people to a righteous God. But, our message gets awfully muddled when we misuse the money that is entrusted with us. Why would someone trust us to listen to our message if we aren’t open and transparent about something as basic as our finances? Why would someone believe that God wants us to care for the poor if the church community spends all its money on events for themselves? Where is our integrity when we say we care about the poor in third-world nations who live on less than a dollar a day, but we spend $50 million on a new building for our church to meet in? As a church, the message is simple: people see the way we spend our money and it reflects on their perception of the truth of our message.


Dear Congress, this applies to you. America was once a shining beacon in the world. Is it anymore? If we expect people in developing nations to believe that democracy works, we’d better be showing them that it does. Our message of the American Way is marred by our financial failures.


8. Someone has to pay the bills and it ain’t fair to leave it for someone else.


A house of cards is bound to come tumbling down someday. It’s funny, but there is a parable about building your house on sand versus building it on solid rock. Now, Jesus wasn’t talking about our budget there, but the lesson still rings true with our finances. We may be able to spend in a deficit for a few years (or generations if you are the government). We can get away with it for a little while, but eventually the bills are going to be called in. It will be time to pay up. It just isn’t right to spend freely now, knowing our children will one day face crushing austerity measures and crumbling economy, just so we selfishly can have everything we want now. For a household, this may mean bankruptcy. For a church, it could very well close us down. For a nation, the end results are almost unthinkable.






9. Brutal Realism is Required.


This is true of thousand dollar family budgets, hundreds of thousand dollar church budgets, multi-million dollar industry budgets, and trillion dollar governments. When it comes time to cut, EVERYBODY must give a little. Pet projects must go by the wayside. If they are good, then maybe they can return someday. This is probably the biggest problem we face as a nation. Everyone agrees that the budget must be cut, but nobody is willing to give away their pet project. The arts community wants the budget cut, just not the National Endowment for the Arts. Soldiers want the budget cut, just not a dime from the military. Teachers want the budget cut, but nothing from the schools. Seniors talk about how they lived through tight times in the depression, but the AARP isn’t about to discuss ANY changes to Social Security or Medicare. It doesn’t matter whether you are a Republican or a Democrat, you want everyone else to tighten their belt, just not you. It’s time to cut everywhere. It’s hard, but sometimes you have to go through EVERY line item on the budget and make adjustments. It hurts, but it is necessary.


10. Yes, budgeting is Hard – Quit Whining About It.


I hate numbers. I detest accounting. I loathe detail work. So what? It’s my job and I have to buckle down and do it. Every year, we have to look at the budget. We have to crunch numbers. We have to make hard decisions. We have to give up things. We have to say, ‘No.’ So, I get a cup of coffee, treat myself to a donut that I’m not allowed to have, I sigh a little; and then I get to work.


Dear Congress and Mr. President (of any administration and any party). Despite what you may have been led to believe, we did NOT send you there to enrich yourself. We sent you there to make hard decisions and to be leaders. Please listen clearly to the following Public Service Announcement: “Suck It Up!!!” Quit whining, work together, give till it hurts, and tell the lobbyists and your own constituents, “I know you want this, but we just can’t afford this, so the answer is No.”






There are some who would say all of this is naïve. Sure, this stuff applies to households and small businesses, but the government just doesn’t work that way. Well, they are right about that last part: it doesn’t work. What we are doing with our money doesn’t work; it is a house of cards that is past due for a collapse. We, the American people of any party, truly are naïve if we think this can continue much longer.


I don't have all the answers, and trust me, this is still a work in progress in my own life.  But, I do know that this lesson will be learned someday... The easy way or the hard way.



* Oddly enough, I wasn’t required to take a single class in Bible College or Seminary called How To Run A Small Business 101.

Financial Tip # 6 - A Cheap Trick

If you weren’t alive in the 70s, perhaps you’ve never heard of the band, Cheap Trick. They wrote a song in the late 70s called “I want you to want me.” The lyrics, sung in a soft seventies pop sound, go something like this: “I want you to want me, I need you to need me, I’d love you to love me, I’m beggin you to beg me.” I am not a fan of Cheap Trick or this song, but there is a lesson here. The singer understands that wants and needs are different.

We’ve taught our daughter an important question to ask. Whenever she says something like, “I need an iPod,” we have her ask the following question. “Is it a need, or is it a want?” Now, as a parent, it sometimes sucks to teach your kids something like this because the day WILL come when I say, “I need a new …. (fill in the blank)” and she will promptly respond, “Daddy, is it a need, or is it a want?” Don’t kids know that they should be quiet and not question their elders?

This is an inconvenient but terribly important tool in your financial tool box. The rule in our house is that we discuss any purchase over $50 and take a breather on anything over $100. Large purchases require (in most cases) a three-day waiting period where we talk about it, pray about it, and question whether this is the right choice. I have to be honest here, it wasn’t always like that. We used to spend willy-nilly on whatever we wanted and then immediately prepared the rationalization about how we really needed it.

What really brings this home is the process of having a yard sale. As you drag all the junk out of closets, from under beds, up on shelves, and off the back porch; you really get an idea of how much money you have wasted over the years, buying on impulse. Retailers know this about us, that’s why infomercials actually stay on T.V. People actually DO buy the New and Improved Electric Dog Polishers or the Amazing Milkahol Device that changes ordinary milk into gasoline for your car or the Moptastic that cleans your floors and can also be used to brush your teeth!!! You see the ad for this and you begin to go into a trance. “I need that!” you suddenly exclaim, “I don’t know how I ever got along without one!” You promptly call the telephone number on the screen before the time runs out so that you can take advantage of the $5.99 savings and free shipping. “Heck,” you think, “I’m probably making money on this deal!”

But wait, there’s more.

That object ends up in your garage only to come out when time for the next yard sale. You then look upon it wondering why in the hell you ever bought that stupid piece of junk. Sometimes, you even throw it in the trash because you don’t want the people coming to the yard sale to judge you.

I know. I’ve been there.

If you want to control your finances and ever truly get ahead in life, you have to ask yourself this one question. “Is it a want or is it a need.” Needs get taken care of first.

Air, food, water and medicine first. Feed your family. Take care of medical needs.

Shelter is second. Pay your rent or mortgage.

Keep the lights on at home. Pay your electric bill.

Save for a rainy day. Savings are important so you don’t get faced with emergency financial decision.

Give. Tithe. Donate some to help others.

Provide for your family’s future. Retirement. College. Etc.

Once your needs are taken care of, then, and only then, do you consider wants.

It is amazing how much money we waste, culturally, on junk. Buying bigger and better televisions, a newer and more powerful computer, a newer and shinier car; these things consume us and consume our money. This is one of those places where you have to be brutally honest with yourself. Every dime, dollar and nickel you waste on useless junk is multiplied in its damage, because it is money that you cannot invest and earn interest on in the future.

If you want to be financially secure, learn this Cheap Trick – know the difference between needs and wants. Ask the question “Is it a need, or is it a want?” and then base your spending decision on the answer.

Disclaimer: I am not a trained financial advisor, I just play one on this blog. Seriously. Get good financial advice in life. My information comes primarily from personal experience, working in consumer lending in the banking industry, and watching friends, family, and parishioners struggle. But, much of this is common sense, most people just don't use their common sense when it comes to financial matters.

Financial Tip # 4: The Death of a Thousand Rose Petals

Marcus Aurelius Antoninus became emperor of Rome at the ate of 14 and was only emperor for four short years. Anyone who has spent any time with teenage boys could have told you that to give him that much power at that young of age would result in debauchery. He was so bad in fact that he disgusted the hedonistic Roman people. And that’s saying something.

During one of his infamous parties, he was said to have arranged for the ceiling panels to be pulled aside and thousands of rose petals dropped on his guests. There were so many rose petals that some of them were suffocated.

A single rose petal weighs in at just around 1/16 of an ounce. Yet, enough of them on top of you can crush you.

And this is where we get into our financial tip for the day:

A single sheet of paper weighs less than 1/200 of a pound and yet enough paper can crush you…Financially.

If you are ever going to get control of your day-to-day spending, your monthly budget, or your lifetime of financial investment; you have to get control of your paper!!! You must get organized.

This is probably the hardest of the financial tips for me to give because it is the one that I struggle with the most. I am a cluttered person. Anyone who has seen my desk can tell it is true. When my wife and I decided to take control and go debt free, we began sorting through our old paperwork. Months worth of unopened mail was placed in a plastic bin and we opened them one item at a time. We found lots of bills that we had paid, but just left the paperwork on the counter. We found sales , ads, and junk mail that should have been thrown away long ago. We found invitations to a party we missed. Worst of all, we found two checks that had been sent to us as refunds. Both were long since expired and of no further use. Our disorderly conduct had cost us money.

To control your budget and get out of debt, you must open your mail every day (or at least several times a week). Prioritize your bills by date and throw out the trash. In fact, I sort my mail over the trash so I don’t set anything down that we don’t need.

Place the bills in a tickler system so that you can pay them in order when your paycheck comes in.

Then, you need a filing system. Label everything. When you pay the bill, staple the receipt to the bill and place it in a file folder labeled for those items. If you are paying off collections, demand a payoff letter from them and then, when you pay it off, keep a copy of the checks you used so you can prove it later.

If your personality type is not one for doing this sort of tedium, you are going to hate it. But, I can promise you that it will save you hundreds and even thousands of dollars over your life time and also cut your stress when it comes time to purchase a home, pay taxes, or deal with collectors who have already been paid.

Like those little rose petals, out of control paperwork will smother you. Control your paperwork and it won’t crush you.

Disclaimer: I am not a trained financial advisor, I just play one on this blog. Seriously. Get good financial advice in life. My information comes primarily from personal experience, working in consumer lending in the banking industry, and watching friends, family, and parishioners struggle. But, much of this is common sense, most people just don't use their common sense when it comes to financial matters.

P.S. I apologize for the break in this series. I was completing homework for school. Talk about papers suffocating you.

Financial Tip # 3 – Keepin’ Up with the Jones

Did you see? The Jones family just bought a new car for Mrs. Jones. We should get a new car too. Our old one is approaching 50,000 miles and it’s brown. I don’t like brown cars. I saw an ad on T.V. yesterday that says that Global Lincoln-Mercury-Kia-Mazda-Ford-Chevy-Mercedes is having a sale. And, since I mentioned a T.V. did you see that Dave got a new 90 inch 3-D Plasma TV. Best Buy is selling those for only five thousand dollars. That’s a savings of almost $2000 off the normal price. Heck, with the money we saved, we could go on a cruise like the Taylors did last month.

It may not be that obvious, but keepin’ up with the Jones family is killing us financially. I watch it in my congregation and in my group of friends. I saw it at the company I used to work for. Whenever someone gets a new car, a new computer, a new T.V., a new cell phone, or some other new toy; several other people immediately go out and get one too. And then, since everyone else is doing it, then even more people have to go get theirs too.

The idea is: if they can afford it, then we can too. The problem with this thinking is that the Jones family is dead broke. They are buying all this stuff on credit. They are so deep in debt with credit card bills and car loans that they don’t see an end in sight.

Frankly, it all comes down to locker-room mentality: ‘Mine is bigger than yours.’ This ‘mine is bigger than yours’ competition is crushing them financially, and if you try to follow them, then you’ll be crushed too.

I used to catch a lot of flack at my old job for driving a Kia. I worked with a bunch of electronics geeks who thought a souped-up rice burner was the be-all-end-all car. If it didn’t have ground effects, a custom paint job, and a turbo; it wasn’t worth driving. You know, the Fast and Furious type. They can’t afford the payment, but they can get from here to the grocery store in 58 seconds. The dark, ugly truth, though, is that they are all drowning in payments. My Kia on the other hand is paid for.

My family has a nice big-screen television. It was given to us second hand. We saved for our computer. We are saving up a little at a time for a nice vacation next year. There is a lot less stress now, when it comes to paying bills than we used to have when we believed that debt was the way to get stuff. You can actually be at peace with money without being a millionaire.

There are two fallacies to look at here:

First – Debt is a tool to get ahead with. That’s just not true. Debt is an anchor that holds you back. Very few people are disciplined enough to really make debt work for them. And even the disciplined ones are only one financial problem away from trouble. Work hard, do without, scrimp and save to pay off that debt and you’ll be able to save and invest your money to work for you, not be its slave.

Second – Stuff makes you happy. Again, it’s just not true. You want to be happy, be debt free. Bills coming in that you don’t have money for are stressful. Credit collectors calling at all hours are nerve-wracking. All the stuff that you thought would make you happy may bring you some joy for awhile, but in most cases, it ends up in the garage sale tomorrow.

Learn to do without. Smile when the Jones’s show you their new car and tell you about their giant plasma. Congratulate them and then go drive home with your family and enjoy a movie together on your normal size T.V. Later, as you are able to walk in and plop down cash for the new toy that you saved for, you can smile again when you realize that they are still paying through the nose for the item that is now an out of date clunker, while you are paying less in cash for the newer, better model.

Don’t keep up with the Jones’ Those poor guys are broke!