One of our consultants Herb Buwalda, has developed a great plan for churches that focuses upon the 3 M’s of debt reduction. As anyone in the stewardship industry will tell you raising funds to pay off debt is some of the hardest dollars you can raise. I always joke that there are only two checks you like to write when you buy a car. One to get you in the car and off the lot and the other to finally pay the loan off. All the other payments are simply a pain. Church members see your debt in the same way.
Your bank however wants that monthly check every month on time! So, how can you motivate people to give to a debt reduction campaign? One simple way is our 3 M Plan for debt reduction that Herb came up with and is seeing incredible results with.
Here are the 3 M’s of Debt Reduction…
1. MANAGE mortgage payments. We challenge donors to see the importance of faithful giving that would allow you to…
(1) Manage the current mortgage now,
(2) Without putting undue pressure on ministry expenses and also
(3) As you reduce principle via capital campaign gifts
2. MINIMIZE indebtedness. The message is to communicate that every new dollar given NOW reduces the loan amount and saves another dollar in the future interest. So we encourage churches to set a reachable goal each year the principle will be reduced by ?___. Then we work to create easily understandable “On Ramps” for participation which will bring on new donors.
The advantages? It makes an immediate impact on the size of the debt which allows you to…
3. MAXIMIZE ministry and mission. We can move from SURVIVING to THRIVING in ministry and mission. As DEBT goes down, resources for ministry and mission goes UP!
Ridge United Methodist Church used this strategy and raised over 2 times their annual operating budget for debt reduction! Here is the lay out of their plan…
Step One: Securing Our Future: The goal was to see enough pledged to meet monthly mortgage payments for the next three years. Ridge members exceeded this goal!
Step Two: Expanding More As We Reduce More: This goal was to allow Ridge to reduce the principle by $175K thus shortening the time they would be in debt AND reducing interest. Ridge members exceeded this goal!
Step Three: Finishing What We Started: This goal was the pledging the total amount of the debt to be paid off in three years. Ridge members made a significant dent in this goal! After their “Thrive” campaign is over Ridge UMC will likely need only one more year to be entirely debt free! Here is what Pastor Knight said about this plan…
“The Charis Group, their staff, consultants and approach to stewardship education, have been a huge blessing to Ridge UMC! Not only has our congregation been able to accomplish a huge goal toward the reduction of our mortgage debt, but our sense of purpose, unity, and overall stewardship has also received a much needed boost! Herb Buwalda has been a tremendously encouraging coach for me as senior pastor, but also for my lay leadership team to understand vision, leadership and generosity in our ongoing stewardship development. We considered a variety of firms, but I am grateful we chose The Charis Group. My team and I highly recommend using them for your next capital stewardship campaign. You will not be disappointed!”
Pastor Michelle Knight, “THRIVE@Ridge” capital campaign
Ridge United Methodist Church, Munster, Indiana
If Ridge UMC can do this your church can too with our help! Call us today and we will get started on a 3 M plan for your church. Let’s get you out of debt!
Mark Brooks – The Stewardship Coach