Rethinking pastor appreciation through proper compensation

By Christy Teeter

While October is traditionally recognized as “Pastor Appreciation Month,” the importance of appreciating our pastors doesn’t end when the month does.
Now is an opportune time for congregations to continue being intentional about going the extra mile to convey their gratitude for the invaluable impact pastors make on the lives of their congregants and the communities they serve.

A handwritten note of gratitude, a gift card to their favorite restaurant, or a craft project from the children’s ministry are all thoughtful and welcomed gestures. However, one significant way that churches can extend their appreciation for their pastors, beyond just a designated month, is through proper compensation.

Today, 41% of pastors increasingly report feeling “burnt out” and “unappreciated.” Further, one in five Protestant pastors say that financial stress is one of their greatest ministry concerns, with nearly half admitting that they worry about their family’s financial security.

And it’s really no wonder that many are feeling financial strain. After all, compensation for many pastors has remained at the same level since 2018. Coupled with stagnant salaries, the past few years of rising inflation rates have only increased the financial burden for them and their families all the more. Unfortunately, under the weight of unaddressed financial burdens, many pastors are left fearful about their ability to continue fulfilling their ministerial calling, let alone plan for their future.

While it’s likely safe to say that the majority of churches greatly value their pastors, many unintentionally leave them vulnerable to financial insecurity by failing to compensate them properly. A church that takes the time to properly structure a minister’s compensation and benefits is practicing good stewardship, which can make a huge difference in the current financial life — and financial future — of a pastor.

The first step churches can take is to revise outdated compensation strategies. For example, too many churches today still utilize the “lump sum” approach to compensation. Under this approach, churches set aside a total amount of money for the pastor who is then responsible for determining how best to allocate their money for retirement, insurance, housing, and taxes.

Also, the lack of a clear base salary leaves many pastors underpaid by making it difficult to identify when pay increases are needed. And it leaves pastors vulnerable to increased taxes on their income — resulting in less money they can dedicate to their personal needs and the needs of their family.

But by simply re-examining the compensation model, churches can provide a solution that improves pastors’ ability to gain financial security and resilience — all without costing their congregation an extra dime.

The best way churches can use their finances to show appreciation for their pastors is by replacing outdated pay scales with a comprehensive salary and benefits package. While this approach uses the same amount of money that would be allocated to a pastor’s salary through a “lump sum” approach, it sets a base salary for pastors, resulting in the pastor having more take-home pay. And it also leaves the possibility open for pay increases as appropriate — improving pastors’ ability to gain financial security and resilience both now and in the future.

Pastors devote their vocational lives to ministry and they should have retirement and insurance benefits that align with their goals and promote their ability to start well, stay well, and finish well throughout their ministry.

As the Chief Retirement Office at GuideStone, I have seen firsthand how too many pastors lose out on the ability to provide for their families in the present and save up for the future because of how their compensation and benefits are delivered. Providing adequate compensation can provide pastors with financial confidence so that they have the peace and freedom to focus on fulfilling their calling to advance the Kingdom.

By investing in the financial well-being of pastors, churches not only demonstrate sound financial stewardship, but also send a powerful, enduring message. This type of commitment speaks louder than words, showing pastors they are valued and appreciated in tangible ways that safeguard both their present and future.

Christy Teeter serves as the Chief Retirement Officer at GuideStone.


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