Wednesday, March 30, 2016

Bivocational ministry compensation

A question I'm often asked concerns compensation for a bivocational minister. Churches who ask the question are often concerned that they are not adequately compensating their bivocational minister but are not sure what would be considered fair. Others might be considering calling a bivocational minister for the first time and wonder what would be fair compensation. Occasionally, I've felt the church asking the question was just wanting to get by as cheaply as possible.

When a bivocational minister asks the question he or she is often feeling that their compensation is too low. They wonder what others are being paid.

Whatever the reason for the question, my initial response is usually the same, "As much as you can afford."

In 2004 I did a survey of bivocational ministers in the American Baptist Churches of USA. I received 112 responses to my survey and found that compensation varied widely. The average was $9,770 for male pastors and $8,578 for female pastors. The highest salary reported was $26,430 for a male pastor and $24,000 for a female pastor.

A few pastors reported they received no salary. Some churches paid their insurance premiums in lieu of a salary. A couple of pastors were allowed to live in the parsonage rather than receiving a salary.

Churches have an obligation to provide for their ministers. While a church may not have the financial resources to pay a fully-funded pastor, they need to be responsible enough to provide reasonable compensation for their pastor. Such compensation can come through a fair salary, but it can also come through non-taxable benefits.

Over one-half of the persons who responded to my survey reported they did not receive a parsonage allowance from their church. Properly set up, this can provide a tax-free increase in what the pastor receives from the church without it costing the church anything. Your CPA can advise how to properly set up a housing allowance.

Many of the respondents said they received no compensation other than a salary. Churches can include reimbursements as part of the salary package as a way of adding to the pastor's compensation. Many churches pay a mileage reimbursement to their pastor. The church I served provided a book allowance and reimbursed me for attending continuing education events and denominational gathering.

One of the best components of my salary package as a bivocational minister was when the church decided to pay into our denomination's retirement plan. Since retiring this past December I am thankful every month for their willingness to help provide for my future. If your denomination does not have such a plan, contact me, and I will help you contact the representative for our plan. They now accept ministers outside our denomination.

The proper answer to the question of how much to pay the bivocational minister is for the church to be as fair to that person as possible. You should set up a salary and benefit package that can meet the current and future needs of your minister. Few people go into bivocational ministry expecting to become wealthy, but we also want to honor those who serve our churches and one way to do that is to be fair with them financially.

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