Instructions for Financial Projection Tool

Please read fully before using the tool.

The Financial Projection tool takes specific financial data from the church and projects out to show where the church will be financially in 10 years. This tool will help you make sense of the data that your church has and visualize the future to assist in strategy and decision making. The basis for these projections is to add a 4% rate of inflation to expenses and calculate investments as having a 6% rate of return.

Before using the tool, there is some data that you need to compile. This data is for 12 consecutive months. We suggest that you use the entire previous year’s financial data (January through December of the same calendar year) if you are using this tool between January and July. After July, we suggest that you use the previous 12 months’ data so that your data is as accurate as possible. Please ensure you have all the data and have recorded it correctly before proceeding. Once you have submitted your data on the tool, you will be unable to edit or resubmit, however you will be able to view your results for the period of time matching your subscription.

The first data you need to compile is the giving to your church by specific life stages. The stages are:

– Under 20
– 20-30
– 31-40
– 41-50
– 51-60
– 61-70
– 71-80
– 80+

The details:
For each age range, you will need to know the total amount given by that group and the number of giving units. If a couple is giving, with one person in one age group and the other in a different age group, place their giving total and count them as a giving unit in the younger age group. For the number of giving units, the minimum number of units for all categories is 1, even if there is no money given.

The next data you need to collect is any other income that the church receives. The categories are:

– Rent
– Fees
– Grants
– Memorials
– Miscellaneous

The details:
If you receive additional offerings beyond the age groupings, place that amount in Miscellaneous. The total for the age range giving and the other incomes should be equal to the total income for the church for the 12-month period.

Next, you need to pull the amount of any investments you have that could potentially be used toward the operations of the church. Even if an account is restricted, i.e. for capital improvements, that account could be used towards operations as part of the buildings & grounds expenses, should the church find itself in a financial crunch. Items not included would be scholarships, endowments with restrictions, etc. You will also enter the year you are doing the projection, i.e. 2023, and the month, from 1 to 12.

Next, you need to have the total expenses for the 12-month period you are using for your projection. The final number you need to enter is the total cash on hand.

After you have pulled all of this information together, complete the Financial Projection Worksheet provided to double-check all information before entering it into the tool and hitting submit. All numbers should be whole numbers with no decimals. Remember to double-check all numbers before hitting submit, as you will not be able to change your initial inputted information.

Once you have submitted your original data, you will receive a notice on the screen that confirms it has been entered, and that you will receive an email with a link to your projection graph within a few minutes. Click this link and your graph will be on the screen and look similar to the graph below.

After the initial information is entered, you may make 2 adjustments to your data. For the adjustments, you may change:

– Growth of giving units by percentage
– Additional income amounts by dollar amount
– The rate of return on investment by percentage
– A percentage of investment you will use each year
– Growth rate of expenditures by percentage

Each of the 2 adjustments will provide you with a new projection graph.