Ingredient Four – Managing Your Cash

Monthly cash receipts seldom match what was budgeted and it is not unusual that during some months, cash outflow will exceed inflow. (Like July and August…)

Not preparing for this may force a church to:

  • Dip into savings or investment accounts
  • Pay bills late
  • Borrow money.
  • Dip into designated accounts (AKA – World War III!)

One way to avoid having to resort to these measures is using a monthly cash budget. This is a fairly simple process of developing a “budget within a budget”.  Using historical data:

  • Estimate the next month’s receipts
  • Estimate the next month’s expenses
  • Compare the net amount to cash on hand
  • Make adjustments as necessary based on the shortfall amount

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