Maximize Cash Flow: 4 Simple How-Tos

(Originally published as an article within ECCU’s former e-publication, Ministry Banking Today.)

You’ve set your budget, created a cash flow forecast (see Maintaining Adequate Liquidity), and hopefully determined your ideal liquidity target. This month, Ministry Banking Today tackles the next step in managing your financial priorities: Maximizing cash flow.

Maximizing cash flow is critical for one simple reason—it will allow you to fund all your long- and short-term ministry goals. And the way you go about it is equally straightforward: Increase income and reduce expenses. Here, we outline a few financial management practices that will help you do just that.

Make it convenient and easy for donors to give. Set up options for recurring gifts, communicate how donations are helping to accomplish your mission, and consider accommodating electronic donations if you don’t already. Be sure your donors are aware of the various ways they can financially support your ministry (for some creative ideas, see Straight Talk on Giving). While you want to get the word out, it’s important to not make donors feel obligated to give—let the need be known and allow God to work.

Focus on where you can make the biggest difference. A down market brings an unexpected opportunity to refocus on what your ministry is called to do and how to best allocate your resources. Assess your spending to determine what dollars most directly accomplish ministry objectives. In what areas can you cut back? Calvary Chapel Murrieta calls this “cutting out the fluff.” They recently decided to scale back their traditionally elaborate holiday celebration. A simpler approach still met ministry goals—without jeopardizing cash flow. 

Free up cash reserves. Rather than maintaining all your liquidity as cash, consider setting up a line of credit as part of your liquidity target balance. Use these contingency funds to help when income is delayed or unplanned opportunities arise to grow your ministry.

Make the most of your banking tools. A banking professional can help you select the appropriate accounts, services, and tools to optimize your ministry’s effectiveness, manage fees and unnecessary expenses, and maximize returns. Set up a consultation or engage in ongoing dialogue with your financial institution to ensure you’re making cash-flow-friendly cash management and financing choices.

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