Church leaders routinely review ministries, budgets, facilities, and staffing. Yet one area can quietly escape the same regular attention: the church’s investment portfolio.
Investments may have been established years ago by a former finance committee, treasurer, pastor, or board. The original decisions may have been entirely appropriate at the time. But leadership changes, markets evolve, fees shift, ministry priorities develop, and policies become outdated. Even a well-designed portfolio should not be placed on autopilot indefinitely.
A periodic investment review is both an act of good stewardship and an important part of fulfilling the church’s fiduciary responsibilities.
Why review the portfolio now?
A review is especially valuable when new pastors, staff members, trustees, or finance committee members assume responsibility. It helps incoming leaders understand not only what the church owns, but also why those investments were selected and how they support the church’s mission.
This process also creates continuity. Important knowledge should not reside solely with one longtime volunteer, staff member, or outside adviser. Clear policies and current records allow future leaders to make informed decisions without having to reconstruct years of history.
Even when leadership has remained stable, an annual review can confirm that the church’s approach still reflects its financial needs, risk tolerance, values, and ministry plans.
What should the review include?
A thoughtful review should consider several key areas.
Investment purpose and time horizon. Each pool of money should have a clearly understood purpose. Operating reserves, building funds, endowments, designated gifts, and long-term investments may require different strategies. Funds that could be needed soon should generally be managed differently from assets intended to support ministry for decades.
Portfolio performance. Performance should be evaluated over appropriate periods and against relevant benchmarks—not simply by asking whether the account gained or lost money last year. Leaders should also consider whether returns were achieved with a level of risk consistent with the church’s objectives.
Fees and expenses. Churches should understand the total cost of managing their assets. This may include advisory fees, investment-management expenses, custodial charges, transaction costs, and other account-level expenses. The lowest-cost option is not automatically the best, but every fee should be transparent, reasonable, and connected to a service or benefit the church understands.
Asset allocation and risk. Market movements can cause a portfolio to drift from its intended mix of stocks, bonds, cash, and other investments. A review can identify whether rebalancing is appropriate and whether the portfolio still matches the church’s ability and willingness to accept risk.
Spending policy. Churches with endowments or long-term funds should periodically revisit how much may be distributed, how distributions are calculated, and whether the policy balances current ministry needs with the preservation of assets for the future.
Investment policy. A written investment policy can provide valuable guidance and accountability. It should describe the portfolio’s purpose, objectives, permitted investments, risk parameters, spending rules, oversight responsibilities, and review process. If a policy already exists, leaders should confirm that it remains current—and that actual practices are consistent with it.
Values alignment and donor restrictions. The church should also consider whether its investments reflect its convictions and comply with any restrictions attached to donated funds. Those restrictions, along with the church’s legal and governing documents, should be clearly documented and understood.
Adviser and service-provider relationships. Finally, leaders should evaluate the professionals and institutions serving the church. Are responsibilities clearly defined? Is reporting understandable? Are questions answered promptly? Are potential conflicts of interest disclosed? Does the church know how each provider is compensated?
Good questions strengthen stewardship
Reviewing a portfolio does not necessarily mean that changes must be made. In many cases, the process may confirm that the current strategy remains appropriate. That confirmation is itself valuable.
The goal is not to react to every market movement or pursue the investment with the highest recent return. It is to ensure that the church’s resources are being managed deliberately, prudently, and consistently with its mission.
Church leaders need not become investment experts. They should, however, be able to explain the purpose of the church’s investments, the principles guiding their management, who is responsible for oversight, what the church is paying, and how results are evaluated.
Setting aside time for this review—and documenting the discussion and any decisions—can help protect the church, equip new leaders, and demonstrate faithful care of the resources entrusted to the ministry.
The Foundation remains available as a resource to help church leaders talk through these important elements, consider helpful questions, and identify areas that may warrant further review—even when your church’s investments are not held by us. A simple annual checkup may be one of the most useful habits a church can establish.