How to make Christian Ministry sustainable, resilient and free from financial fear

A new path to serving Jesus

Have we got how our recruitment strategy for ministry workers wrong? A. W. Wong believes that encouraging people to become financially independent before they become full time ministry students and workers would be a better and more sustainable way.

A Waste of Good People

Over the last decade, I have noticed something amiss with Christians going into Ministry.  Young Christians are dropping out, or getting burnt out, at an alarming rate.  I have seen Christians turn their back on their faith.  I have seen Pastors burn out.  I have seen people leave the Ministry and return to secular work.

Often young people are asked to raise money to live on as they join programs such as The Ministry Training Strategy (MTS). Raising these funds can be quite stressful for anybody, let alone a young person, and, adding to that stress, is the fact that the amount increases each year.

Unfortunately, we live in a world in which money is still a necessity and, because the compound effect works best the earlier you start, a low income can severely impact your ability to retire when you want or need to.  For example, suppose that after university you choose to work in Ministry rather than in a secular job.  For five years, before you decide it’s not for you, you earn $500 per month less in the Ministry than you would in the secular world.  Effectively you will have lost $206,000 over 30 years due to the compounding effect.   And this does not even include the lost income from starting at the bottom of the corporate ladder.  For low-income earners this is a lot of money and may mean having to work another decade before being able to retire.

Another drawback of this system is that for a young Christian going into Ministry without achieving at least some key life and work milestones and experiences can be overwhelming. I believe Ministry burnout can be directly attributable to young Christians going into Ministry without an established work ethic or understanding of “office politics”.

Another Way

I believe very strongly that a Christian should go into secular work before any Ministry and/or Bible college. If I were to be forced to give an answer, I would say until at least 30 years of age. By living frugally I believe many people can achieve FIRE (Financial Independence, Retire Early) – and devote the rest of your life to ministry.

I have said above that 30 should be the earliest that you should consider FIRE if you can reach it, but not everyone can. I have done some calculations to give you a guide on how much you need to invest each month to reach regular FIRE ($1.5m in investable assets) by number of years from having zero invested.

When you FIRE, you attain the freedom to pursue your aspirations without having to worry about paying bills; the freedom to leave a toxic workplace, team, or environment; the freedom to survive a pandemic without a job; the freedom to serve more at your Church –  without pay, if you wish.

Building up wealth over time, making strategic and thoughtful decisions – with or without guidance from a financial professional, reducing expense and increasing income, and consistently learning about gradually increasing wealth helps you to manage your money responsibly and wisely. This is one of the key principles of FIRE in which your initially small investment grows over time from your regular contributions and reinvestments. Whether you like it or not, even if you don’t contribute another cent, it will continue growing.

Being wise with money has nothing to do with loving money or making money your master. In this context it’s actually serving you because you are personally choosing to leave the workforce with $1.5 million, for example, instead of working until 60 and having $20 million. You have made the decision that it is enough to cover your annual expenses, with a buffer, and will need to demonstrate discipline and constraint to make it last a lifetime.

 

There are a number of benefits to this solution: Firstly, you will suddenly be exposed to more non-Christians than many Ministries so you have to opportunity to make disciples which you can then appeal to when you go into Ministry.  Secondly, you will be able to gain work experience, build resilience, and mature before you go into Ministry.  Thirdly, you will be able to relate to people in your Ministry better as you will have more life experience and will be able to offer them more than prayers…which are, of course, still amazing. Fourthly, you would have at least some additional income to form part of the money raised as part of the ministry salary you need if required.

Case study

Let’s look at a scenario that will allow you retire within a decade (aged 32/33) of your first job after university/apprenticeship for both single and couples.

Given the short time horizon, sacrifices must be made, and your budget needs to be as basic as possible especially for people with a low income. I’ve complied a budget that is not too dissimilar to the one I was following when I was single, and in a relationship.

This case study is not meant to imply that there is only one black and white way to apply the idea of building up assets before setting out to minister. it’s ok to start your ministry track after ten years or earlier without reaching the target if you don’t want to work for free but simply have the flexibility to ask for less which does help many churches.

Budget Single Couple
Expenses Weekly $ Annual $ Weekly $ Annual $
Rent $190.00 $9,880.00 $400.00 $20,800.00
Groceries $50.00 $2,600.00 $70.00 $3,640.00
Commuting $20.00 $1,040.00 $40.00 $2,080.00
Internet $50.00 $2,600.00 $50.00 $2,600.00
Phone Bill $20.00 $1,040.00 $40.00 $2,080.00
Energy Bill $15.00 $780.00 $25.00 $1,300.00
Haircut $5.77 $300.00 $37.50 $450.00
Entertainment $19.23 $1,000.00 $38.46 $2,000.00
Total Expenses $370.00 $19,240.00 $700.96 $34,950.00

Assumptions: 1. You will house share as a single but not as a couple, 2. A couple will rent a studio/single bedroom apartment, 3. Both single and couple will be working from home half the time public transport/petrol cost, 4. Plenty of cheap sim plans from Kogan, Lebara, Aldi, Woolies, Circle Life, Felix Mobile, 5. Haircut 6 times for men and 3 times a year for women.

Income and investment for singles:

Year Income $ Expense $ Invested $ Cumulative Invested $ Dividend Reinvested $ Capital Return $ Total Invested $
1 $50,000 $20,000 $30,000 $30,000 $1,200 $936 $32,136
2 $55,000 $20,000 $35,000 $67,136 $2,685 $2,095 $71,916
3 $60,500 $20,000 $40,500 $112,416 $4,497 $3,507 $120,420
4 $66,550 $20,000 $46,550 $166,970 $6,679 $5,209 $178,858
5 $73,205 $20,000 $53,205 $232,063 $9,283 $7,240 $248,586
6 $80,526 $20,000 $60,526 $309,112 $12,364 $9,644 $331,121
7 $88,578 $20,000 $68,578 $399,699 $15,988 $12,471 $428,157
8 $90,000 $20,000 $70,000 $498,157 $19,926 $15,543 $533,626
9 $90,000 $20,000 $70,000 $603,626 $24,145 $18,833 $646,604
10 $90,000 $20,000 $70,000 $716,604 $28,664 $22,358 $767,626

Assumptions: 1. First year salary is $50k which is slightly more than median wage and well lower than the average,
2. Salary increase by 10% each p.a. until year 8 to be conservative but accounts for at least 1 promotion,
3. Dividend yield is 4% p.a. and capital return is 3% p.a. inclusive of inflation, 4.
Investing all savings,
5. This table is based on after tax income.

Income and investment for a couple

Year Income $ Expense $ Invested $ Invested $ Dividend Reinvested $ Capital Return $ Total Invested $
1 $100,000 $35,000 $65,000 $65,000 $2,600 $2,028 $69,628
2 $110,000 $35,000 $75,000 $144,628 $5,785 $4,512 $154,926
3 $120,000 $35,000 $85,000 $239,926 $9,597 $7,486 $257,008
4 $130,000 $35,000 $95,000 $352,008 $14,080 $10,983 $377,071
5 $145,000 $35,000 $110,000 $487,071 $19,483 $15,197 $521,751
6 $155,000 $35,000 $120,000 $641,751 $25,670 $20,023 $687,443
7 $160,000 $35,000 $125,000 $812,443 $32,498 $25,348 $870,289
8 $160,000 $35,000 $125,000 $995,289 $39,812 $31,053 $1,066,154
9 $160,000 $35,000 $125,000 $1,191,154 $47,646 $37,164 $1,275,964
10 $160,000 $35,000 $125,000 $1,400,964 $56,039 $43,710 $1,500,713

Assumptions:
1. First year salary is $50k each. This income is significantly lower than the current average full-time income of $90k and not too far off the median income.
2. 
Salary increase by $5k each p.a. until year 5 to be conservative but accounts for at least 1 mini promotion each,
3. Dividend yield is 4% p.a. and capital return is 3% p.a. inclusive of inflation,
4. Investing all savings,
5. This table is based on after tax income

In order to be more conservative, you don’t start investing until your first job after university for this scenario. For either singles or couples to retire in a decade you will need to be able to invest all your savings after expenses. This will result in ~$768k for singles and ~$1.5m for couples in investible asset. This is ~$31k and $60k passive income per year respectively.

Anyone that earns more the income shown in any year will have more disposable income to either retire earlier or a bit later if you want more buffer or can afford to spend a bit more to make the journey a bit more enjoyable.

Please note this is not a race and you should invest at a pace that is comfortable for you but this gives some idea for those ambitious and able people.

The effect of time on FIRE: the magic of compound interest

Years to FIRE $ Invested Per Month Own Money Invested $ Compounded Amount $
1 $121,040 $1,452,481 $47,519
2 $58,409 $1,401,813 $98,187
3 $37,566 $1,352,363 $147,637
4 $27,169 $1,304,130 $195,870
5 $20,952 $1,257,108 $242,892
6 $16,824 $1,211,293 $288,707
7 $13,889 $1,166,678 $333,322
8 $11,701 $1,123,255 $376,745
9 $10,009 $1,081,017 $418,983
10 $8,666 $1,039,953 $460,047
11 $7,576 $1,000,052 $499,948
12 $6,676 $961,303 $538,697
13 $5,921 $923,693 $576,307
14 $5,281 $887,209 $612,791
15 $4,732 $851,836 $648,164
16 $4,258 $817,559 $682,441
17 $3,845 $784,362 $715,638
18 $3,483 $752,227 $747,773
19 $3,163 $721,138 $778,862
20 $2,879 $691,076 $808,924

Note: Assumptions used are 7% return p.a. inclusive of inflation compounded monthly

It is clear from the table above, the earlier you start the less you need to invest each month and the more you can rely on compounding to reach regular FIRE (passive income of $60k/year). You could even let dividends reinvestment do all the work once you’re happy with the time left to FIRE and want to balance enjoying the journey as well. The $1.5m target is generally for a couple. This table does serve as cheat sheet to quickly see how long you’ve got left before you can retire.

How FIREd up people can transform a church budget-wise

Imagine a Church budget of $200,000 where the Pastor is paid $75,000 and $60,000 is allocated for other workers, and the remainder earmarked for “necessary operational costs”. There are, on average, 100 weekly tithers. This means that they would need to be able to contribute approximately $40 per week, per person.

Now imagine if some of those jobs were taken up by suitable, passionate Christians who have reached FIRE and are not interested in being paid.  Suddenly you have a budget of $65,000 which means attendees need only to tithe around $12.50 per week.  This tithe is more affordable for many attendees, and would probably be exceeded by most, without putting a burden on anyone. In one fell swoop a core cost could be eliminated, and the budget freed up for activities to benefit the entire community such as Church planting, camps, outreaches, and sponsorships.

It is also likely that your Church donates money to MTS workers or international Missionaries.  This expense line item is unlikely to be fully eliminated although it can be minimized because suddenly the number of people who are seeking funding is reduced or does not need to fully rely on others to reach their respective funding target to start working.

Final Thoughts

Conservatively invested, $1.5 million may pay an early retiree a sustainable allowance of around $60,000 per year.  More importantly, however, it will set them free from the shackles of remunerated employment and material consumerism and allow them to pursue the passions and interests that bring joy to their hearts while contributing to their communities and churches.

I have witnessed, firsthand, how vital retirees are in keeping a Church humming along and operational…and how they are missed when they are in short supply. By starting your ministry in your 30s as an early “retiree”, you emerge as more mature, resilient, experienced and able to serve your community in all seasons and all times.

Surely this is a more sustainable recruitment model.

A.W. Wong is a frugal Christian professional from Sydney and runs a personal finance blog  as a hobby. He has rented in Hobart, Melbourne, Canberra and Sydney between 2011 – present and also likes to keep updated with the rental market due to property interest and the flexibility of living in a rental. He is passionate about free financial literacy and giving people, especially ministry workers the information and tools to live a more sustainable life and leave a legacy for generations to come.

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