Stock Market Insights: Preparing your church for a recession: Key steps

A recession is coming. That is because there is always a recession up ahead. The next recession, whenever that might be, will be the most anticipated in history because everyone thinks it should be here by now. As horrible as recessions might be, they are inevitable in any strong economy.

What is a recession exactly? It is often defined as at least two consecutive quarters of declining Gross Domestic Product (all U.S. sales) following a time of growth. Janet Yellen, the current U.S. Secretary of the Treasury, says a recession is when “people stop buying things.”

The experts have no consensus on whether a recession will occur in 2024 or 2025. With this being an election year, it will not be surprising if the Federal Reserve and politicians do everything they can to push it past the November elections. Regardless of the exact timing, know a recession is coming, and another one will come a few years later, because they come more frequently than you might think.

Since 1950, the U.S. has averaged a recession once every 6.5 years. Those recessions lasted between two and 18 months, with the average recession lasting about 10 months.

Church leaders need to consider the impact of a recession on their goals. The budgetary decisions made in 2024 will significantly impact 2025 planning. It’s the fourth quarter of the game. Organizations must think through a recession’s financial outcome for their churches.

It seems we might be overdue for a recession. Since they come so frequently, Christian organizations should be preparing in advance how to steward the resources God provides. Denominational consultants are an excellent resource for assistance when facing long-term financial decisions, future projections and financial contingency plans.

Church leaders must be aware of their church and community’s financial outlook. We want to raise pastors’ and leaders’ awareness about their responsibility to understand the church’s financial situation, whether a recession is imminent or not. Secondly, we want to provide helpful tools for preparing for a recession.

  • Evaluate your community.
  • Know your per capita giving.
  • Project your budget.
  • Consider your church reserves.

Step one: Evaluate your community

How hard would a recession hurt your community specifically? There is more to this than just finances. However, this article focuses only on finances. There will be people in your community and church who will see their home prices and savings drop and many others who will become unemployed.

The questions to consider in evaluating your community are: How recession-proof are the industries in our community? What curriculum should you prepare to guide your congregation through this financial season? What community resources could you partner with to help those most affected?

Church leaders should continuously keep the pulse of the economic impact of their community for potential adverse effects on your church’s finances. If your community is in decline, that will impact your budget and giving for the next year.

Step two: Know your per capita giving

Per capita giving is often referred to as the number of giving units. Some might be offended by reducing an individual believer to a “giving unit,” but we are using it to communicate how many people give in your church, not disrespectfully.

This information is used to establish per capita giving. The total of undesignated receipts is divided by the number of “family units” that contribute financially. This equals your per capita annual giving.

A couple of essential questions to consider in evaluating your per capita giving is: How much of my per capita giving could be negatively impacted by the more vulnerable to recession industries in our community? Would your church be able to meet its budgeted fixed expenses if your per capita giving was abnormally affected?

Step three: Project your budget

Using the above data, church leaders can forecast potential changes in giving and prepare for the coming impact on the church.

One critical piece of the projection is calculating inflation into your budgeted expenses. This helps a church determine whether it should hire more staff, replace a leaving staff member, build a new building or push deferred maintenance further in the future, etc.

Items to consider when projecting your future budget:

  • Is your benevolence fund at a level to assist in a recession?
  • What future maintenance issues can be postponed?
  • Are there events that could cause a budget crisis that you could mitigate now? (i.e., the furnace or sound system failing)?
  • Is your giving increasing or plateauing?
  • Is there any fat in the budget to cut out?
  • How would a recession affect your members’ “planned giving?”
  • Are there new ministries that need to be delayed?

Step four: Consider your church reserves

How much should you have in reserves? This question significantly impacts great commission planning. Some in your church want to save everything, and others want to spend every dime. The reality is a church should have a strategy for its reserves.

It is not unbiblical to hold funds in reserves. The very opposite is true. Genesis 41:25 begins with the account of Joseph interpreting Pharaoh’s dream to store up for the seven-year famine. This provides us with a model to have funds in reserves. We should be prepared for the future, which means we should always be ready for the lean years.

We recommend that a church determine its fixed expenses (debt, salaries, utilities, insurance, etc.) and keep a minimum of one year of fixed expenses in reserves. On average, the fixed expenses seen through consulting with churches tend to be about 65% of the annual budget.

Is a recession imminent? We don’t know because guessing a recession’s exact start or end date is impossible, but that is unnecessary. Knowing one is coming is what is important.

One thing is certain: Church leaders should have a strong plan prepared so they can lead when a recession affects their community. Emotions from church members and staff can be one of the biggest roadblocks to a strong financial plan, and this is especially true during times of financial stress. A strong proactive plan will alleviate emotions from any potential financial crises. Because of the cyclical nature of recessions, it is important to be prepared and maintain a long-term perspective.

If you need assistance with church budget planning, reach out to your state convention or partnering conventions. There are some expenses related to using a consultant, but they are generally worth the cost for the preparation it provides a congregation.

Richard Baker, AIF, is the CEO and executive wealth advisor at Fervent Wealth Management in Springfield, Mo. He writes a weekly article in numerous papers and has authored “Biblical Retirement” and “How do I Retire?” He received his Doctor of Ministry from Midwestern Baptist Theological Seminary in Kansas City. Richard can be reached via email at

Kenneth Priest is a church consultant and founder of He has authored/co-authored several books in church revitalization including “Rubicons of Revitalization” and “Groups that Revitalize.” He received his Doctor of Educational Ministry in church revitalization from Midwestern Baptist Theological Seminary in Kansas City, Mo., where he serves as an adjunct professor for doctoral studies in church revitalization through their global campus. Kenneth can be reached via email at

Fervent Wealth Management is a financial management and services entity in Springfield, Mo. Securities and advisory services offered through LPL Financial, a registered investment advisor, Member FINRA/SIPC.

Opinions are for general information only and not intended as specific advice or recommendations. All performance cited is historical and is no guarantee of future results. All indices are unmanaged and can’t be invested in directly.

The economic forecast outlined in this material may not develop as predicted and there can be no guarantee that strategies promoted will be successful.

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