Church Insurance

The Dreaded Church Budget!!!

in Church Bond Investing, Church Bonds, Church Financing, Church Insurance, Church Loans, Funding my church, Funding Renovation

Financial management can be daunting… Few things are more stressful for church leaders than compiling the annual budget. Proper financial management can be both intimidating and at times overwhelming. Yet, good accounting practices can go a long way down the road toward financial stability for a church. A well-organized budget and accounting controls can allow church leadership to focus less on administrative issues and afford more time and energy toward ministry and outreach. Planning. Checking. Planning some more. A good church budget can provide a way to track the income and expenses giving church leadership the information necessary to make the best strategic financial decisions. When creating a church budget for the upcoming year, one budgeting approach is to start from zero and evaluate each expense line item based on the church’s ministry needs. There are many different types of expenses that go into maintaining the church, from staff salaries to computer equipment to items such as choir robes and Sunday School materials. A well-designed church budget can assist church leaders with keeping track of various costs and expenses to make certain that the necessary funds are available when needed. A good church budget can assist church leaders with keeping track of various income sources, such as tithes, offerings, and certain designated giving such as building fund contributions. Federal, state and local economic conditions at any given time can make it difficult for church leaders to forecast future income the church will receive, so consider historical income trends as one way to forecast future giving. Conservative budgeting is one way to avoid funding shortfalls. Church leaders can revisit the church budget mid-year to make the necessary adjustments to avoid overspending or underspending in important key areas. The importance of proper financial management cannot be overstated, because it is the foundation for financial sustainability and stability of the church. Good fiscal accountability can allow the church to conduct important ministry projects without the burden of worrying how to keep the lights on. A healthy budget can help feed a healthy...

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Church Bonds as a Financing Option

in Church Bond Investing, Church Bonds, Church Financing, Church Insurance, Church Loans, Funding my church, Funding Renovation

Church Financing Options There are similar features with a church bond as there are with a commercial loan, in that a church bond program is fixed for a certain period of time and has a certain repayment schedule. One of the biggest benefits that church bond financing can offer a church that most conventional bank loans cannot provide, is that church bond financing can provide churches with a fixed interest rate and repayment schedule similar to a fixed rate residential mortgage loan. On the other hand, with church bond financing, the church has more flexibility and control since the interest rate and the amortization or repayment period is fixed the full term of the church bond issue. With church bond financing, the church is effectively setting up a permanent repayment plan for the entire term of the bond program. With a church bond program, the church is paying the interest on the church’s loan to church bond investors, such as members and friends of the church, and other church bond investors and not to a bank. Consider All Church Financing Options Consider all options when seeking financing for your church. Conventional bank financing can be a better financing option under certain circumstances. For example, if a church is only in need of short-term financing, then a bank loan may be the better option. However, if the church needs or wants the certainty of a long-term fixed interest rate and repayment period, then church bond financing may be the better financing option. Church bonds can give the church a long-term, fixed interest rate and repayment period that it would not have with a commercial bank loan. And, many churches with long-term capital needs prefer that the interest paid on their church loan go directly to church members and other Christian investors, instead of a...

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Prepare for the Worst

in Church Bonds, Church Financing, Church Insurance, Church Loans

When the unexpected happens… The practice of risk management and insurance coverage usually isn’t something church leadership thinks about on a regular basis. However, the proper comprehensive insurance coverage can help your church to prepare for the unexpected and to maintain a comfortable environment for your members. Churches are subject to lawsuits just as any other organization. Getting the proper insurance coverage is an essential and necessary step to protecting your church and its members for many types of losses. While insurance protection does not eliminate a good safety plan, it can be a valuable tool. What does this have to do with church financing? Everything. When financing or refinancing your church loan with church bonds, funds become available for a new church facility or various capital improvements of the existing church building. Because many churches will utilize volunteer help with various construction projects, what happens if something breaks or falls on that person? Your church can now become liable for those damages. This is why having the proper insurance coverage is a necessity for a church or ministry. Okay you’ve convinced me, now what do I need? There are two basic types of insurance coverage that you should consider for your church: 1.) Property Coverage – This includes specialized forms of insurance coverage for the church buildings and equipment that provides for certain financial reimbursement to the church for most risks, in the event of destruction from fire, theft, and certain natural disasters. It should be noted that many basic property insurance policies do not cover losses from floods and earthquakes, so if your church is located in a high-risk area of these occurrences, make sure that your church has additional insurance coverage for the possibility of losses from these catastrophic events. 2.) Casualty Coverage – This type of insurance coverage broadly covers the risk of financial losses not directly concerned with life insurance, health insurance or property insurance. In general, casualty insurance covers the legal side of things, whether it is property damage or injury to a church member, worker, or visitor. Having the proper casualty insurance coverage can help prevent financial losses to the church from unforeseen lawsuits and medical bills. It is important to note that...

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