By Cynthia Woolever
First, some basic facts. Across denominations and faith traditions, the most reported major source of congregational income is what individuals contribute through their offerings, pledges, donations, and dues. In short, most churches operate on what individuals give. (One leader from each participating congregation reported the three largest sources of income for the congregation.)
For mainline Protestant churches, the second most common big financial source is income from trust funds, investments, or bequests (48%).
In contrast, the second most common major source of income for Catholic parishes is charges for use of congregational facilities (41%).
Fewer conservative Protestant churches receive much income from investments (only 20% cited investments as a major income source) or facility use charges (about 14% said this is one of their big income sources).
Does the size of the church determine where the money comes from? Yes and no. Regardless of church size, one of the three biggest sources of congregational income is what individuals contribute through their offerings, pledges, donations, and dues. But size does matter for some types of income flow. One-third of medium-size and large congregations receive funds from facility charges. We can assume that churches with more worshipers also have more spacious church facilities, and that leads to more diverse usage. Four in ten small churches (with fewer than 100 worshipers) rely on income from trust funds, investments and bequests.
How big is the individual gift slice of the whole budget pie? On average, congregations receive about 91% of their funds from individuals’ donations. Among Catholic parishes, 84% of funds come from individuals’ donations; among mainline Protestant churches, 90% of funds come from individuals’ gifts. The highest percentage of income coming from individual donations—the biggest slice—is among conservative Protestant churches, where 97% of the income comes from these individual gifts.
What is your church’s bottom line? Based on theology and tradition, many congregational leaders believe that living members should fund the church’s current ministries. What are your congregation’s funding sources? Have the proportions coming from various funding sources changed in the past ten years? Are the proportions consistent with the church’s theology and mission?
Does your congregation have an endowment? If not, would members consider establishing an endowment as an opportunity worth exploring? If the congregation has an endowment, is the use of this resource consistent with the church’s theology and mission?
Has your congregation explored alternative funding options in the past year? If not, what promising avenues might be possible now?
Learn more about congregational giving.