How to Invest Church Money

Investing church money can seem like more of a challenge that it really is. But being a good steward of the material wealth that God has bestowed on a church or other charitable organization is not particularly difficult; prudent church investing merely requires the application of a few Biblical concepts and some common sense.

Open a bank or brokerage account using 501(c)3 paperwork so that the money is given proper tax treatment. Make sure that the church treasurer and all other necessary church officers are authorized to access the funds.

Consider what the money is intended to be used for and how soon access is needed. If money is needed for something fairly soon, then you will probably need to invest it in something liquid, like a money market account or a short-term CD. If the church won't be needing the money for a while, consider a longer term investment such as an income mutual fund or growth and income mutual fund with a solid long-term track record.

Start a 403(b) plan if the church intends to use the money to fund a retirement plan for its employees. You can invest the proceeds in the plan among the choices provided by the plan sponsor. This will include stock and bond mutual funds, perhaps inside a variable annuity contract. Invest long-term funds in more aggressive stock funds for growth. Shorter term monies should be allocated to more conservative choices such as bonds or income funds.

Always invest corporate church money conservatively. Remember that you are a steward of what God gave you; He would not want you to take unnecessary chances with it. Don't try to achieve the church's financial goals solely through investments.

Be certain that whatever investment you use is authorized in the church bylaws. You may not be allowed to invest in speculative instruments such as options and futures, or even aggressive ones such as small cap funds or individual stocks. The bylaws may also prohibit investments in certain industries, such as tobacco or alcohol; by the same token, they may require that preference be given to socially responsible investing. Know the rules your church has laid out for the handling of its money so that you don't run afoul of your elder board.