Investing Church Funds: Smart Stewardship or Risky Business?

Over the past few years, I’ve had a growing number of churches come to me asking what to do with excess funds. Should we invest it? What are the risks? What are the biblical and practical considerations?

I’ve also seen a few spirited Facebook threads on the topic, with pastors passionately debating both sides. I know, I know… shocking that pastors would strongly disagree on anything!

It’s easy to understand the hesitation. Investing is about profit and risk. The church is about generosity and sacrifice. Do those two belong together?

In this post, I’ll walk through the strongest arguments against and for churches investing funds, and then offer my own take as a financial planner and advisor to churches across the country.

And please do me favor. You may already be walking into this article with a strong opinion. Carefully consider the arguments for and against, but also consider that we need to reconsider the very idea of what investing actually is. 

Why Some Say Churches Should Not Invest

1. It Distracts from the Church’s Mission

The church is called to spread the gospel, serve the needy, and disciple believers. It’s not supposed to be a financial institution. Verses like Matthew 6:19-21 and Acts 2:44-45 emphasize generosity over storing up wealth. You could argue that investing funds could delay helping people who need support now, especially when urgent needs are going unmet in missions, church planting, foster care, and more.

2. Risk of Financial Mismanagement

Money invites risk, not just investment risk, but moral and administrative risk. We've all heard horror stories. I remember a guy in the early 2000s who traveled the country pitching an investment scheme to churches and individuals. Turns out, it was a Ponzi scheme. Many lost their money, and he went to jail. If a church isn’t careful and discerning with its investments, it opens itself up to unnecessary danger.

3. Confusion Around Non-Profit Status

Some people think a church can’t invest because it’s a non-profit. But being a non-profit doesn’t mean you can’t make money from investments. Investment income (interest, dividends, capital gains) is generally not taxable to a church so long as the church retains its primary mission. Issues arise only when a church starts engaging in business unrelated to its mission.

4. It Might Shift Our Dependence from God to the Market

Biblically, we’re called to trust God for daily provision. Remember the Israelites and the manna in Exodus 16? Some fear that investing could slowly shift a church’s trust from God to man-made financial systems. And let’s be honest, many wealthy churches today are declining in attendance and impact. It’s better to be a growing church with little money than a dying church with a big portfolio.

5. It May Betray Donor Intentions

People give to a church because they want their money to go toward ministry, not to sit in a brokerage account indefinitely. That said, the reality is that the money is still going to ministry - just at a later date. Perhaps it's a bit like returning your Christmas gift to get something in a different size or color? The gift is still getting used but maybe not in the way the original giver thought it would be. Some folks are fine with it. Others feel weird about it.

6. Risk of Missional Drift

If you invest for the long term, how do you ensure that money will still be used in line with your current mission or theology decades down the road? Churches can change. Without clearly defined parameters, it may be possible that the money is used for something other than its original intent.

7. Moral Concerns About Investment Holdings

Some churches avoid investing altogether because they don’t want to profit from companies tied to alcohol, tobacco, abortion, or other morally objectionable industries. That’s a valid concern, though not a reason to dismiss investing entirely. There are ways to screen your investments or choose non-stock alternatives.

Why Some Say Churches Should Invest

1. Stewardship Requires Planning Ahead

Scripture teaches wise financial management. The parable of the talents (Matthew 25) praises those who multiplied what they were given. Proverbs commends the ant who stores up during the harvest. Investing doesn’t need to be about greed; it can be a faithful way to manage what God has entrusted.

2. Churches Have Future Financial Needs

Whether it’s facility upgrades, staff support, or new ministry initiatives, churches face long-term expenses. Joseph’s advice to Pharaoh in Genesis 41 is a clear biblical example of investing during good years for the hard years ahead.

3. Investing Reduces Pressure on the Congregation

Instead of running a capital campaign every few years, invested funds can produce steady income to support missions, salaries, or upkeep. This frees your members to give joyfully rather than out of obligation (2 Corinthians 9:7).

4. Investing Can Serve Future Generations

Proverbs 13:22 says a good man leaves an inheritance to his children’s children. The same principle could be true of a church. Strategic investing today could fund gospel ministry for future generations.

5. Investments Can Multiply Ministry Impact

A dollar wisely invested today could become two dollars for ministry tomorrow. Paul told the Corinthians to excel in the grace of giving (2 Corinthians 8:7). Investing can increase generosity over time.

6. It Can Help the Church Avoid Debt

Planning ahead with reserves means you might not have to take on a mortgage or go into debt for building projects. Proverbs 22:7 warns us that the borrower is servant to the lender. Investing could allow your church to pay cash and avoid financial bondage.

So, Should Your Church Invest?

Here’s what I tell churches: you’re already investing. After all, the very definition of an investment is placing your money in something with the expectation of growth over time. If you’ve got money in a savings account, money market, or CDs, you are investing. You’re just taking a conservative, low-risk approach. And that’s totally appropriate for many churches.

The real question isn’t “Should we invest?” It’s “What kind of investing is appropriate for our church?”

That’s going to depend on your church’s financial situation, giving patterns, future plans, and risk tolerance. There’s no one-size-fits-all answer.

Practical Steps for Your Church's Investing Strategy

1. Start with a Philosophy

   
   

   What’s your church’s purpose for investing? Are you trying to meet a long-term goal like a building fund? Or support missions consistently over time? Make a list of present and future needs, pray about them, and ask for wisdom.

   
   

2. Use a Written Investment Policy

   
   

   This should include what types of investments are allowed (CDs, mutual funds, etc.), your target amounts or % of church funds you would keep in each investment, and when/how you plan to use the funds. This provides clarity and accountability.

   
   

3. Match Risk with Timeframe

   
   

   Have short-term needs? Stay conservative. Long-term goals? You might diversify more. A church could also use a withdrawal strategy - distributing a small percentage of invested funds annually while preserving the core.

   
   

4. Consider Values-Based Investing

   
   

   If you're considering allocating a portion of investments into stock but are concerned about ethics, look into Biblically Responsible Investing (BRI) funds that avoid objectionable industries.

   
   

5. Explore Giving Tools Like DAFs

   
   

   Donor-Advised Funds allow members to donate appreciated assets and avoid capital gains, while giving the church more flexibility. These can be powerful tools to support big projects or future needs.

Examples of Investments

Depending on the situation here are 4 potential ways a church might structure their investments starting with the least risky. This is not investment advice and these are not all the options but hopefully enough to give you an idea of the possibilities. 

Money Market / Savings Accounts

These accounts offer low risk and quick access. Returns can fluctuate with interest rates (as I write this blog, most business accounts are paying around 3% on the higher end) and remain positive as long as the bank is solvent. The downside is that returns are typically on the lower end compared to other investment options.

Laddered Certificates of Deposit

A CD ladder staggers investments across different time frames so that you regularly have money  maturing and coming available. For example, you spread equal amounts into 5 CDs 1 year - 5 years in length, and whenever a CD matures, you reinvest it into a new 5-year CD, creating a cycle where a portion of the funds becomes available each year. (This strategy can also be applied to bonds.) It offers conservative and predictable returns, but early withdrawals may incur penalties. As long as the bank is insured and solvent, your principal stays secure.

Buffer ETFs + Laddered CDs For those seeking slightly higher returns with limited downside, combining laddered CDs with Buffer ETFs can be a balanced approach. Buffer ETFs track the stock market but offer built-in protection. This strategy offers growth potential with reduced risk, though long periods of weak market performance could result in lower returns than CDs.

All-Weather Portfolio

This is a broadly diversified portfolio designed for lower volatility and moderate long-term returns. Similar to how endowment funds invest their money, it includes a mix of several asset classes (like stocks, high-quality bonds, gold, and commodities). The upside is stronger growth potential for a long term investment. The downside is that the account will fluctuate over time thus making it not ideal for short term investing.

If you're a church leader or board member wrestling with these questions, I’d love to help you think through them. Visit nateskelly.com or email me at info@nateskelly.com to schedule a time to chat.

This article is for informational purposes only and does not constitute investment advice. The views expressed are those of the author and should not be interpreted as specific recommendations for any individual or organization. Please consult a qualified financial advisor before making any investment decisions. Nate Skelly is an investment advisor representative of Financial Pathway LLC, a registered investment advisory firm registered in the State of Florida.