Caring for Church Investments with Wisdom, Accountability, and Purpose
As a new year begins, many churches take time to reflect, set priorities, and renew commitments to faithful ministry. One meaningful New Year’s resolution for church leaders is to pause and thoughtfully consider the church’s investment portfolio. Endowments, reserve funds, memorial gifts, and long-term investments are tremendous blessings, but they also carry serious responsibility. One of the most important and often overlooked practices of good stewardship is periodically evaluating investment advisors, investment performance, and fees. A widely accepted best practice is to conduct a formal review every five years, or sooner if there has been significant change in markets, leadership, or the church’s financial circumstances.
Investment environments evolve. Advisors and firms change. Fee structures shift. Even long-standing and trusted relationships can slowly become misaligned with a church’s mission, risk tolerance, time horizon, or spending needs. A thoughtful, documented review allows church leaders to ask faithful and practical questions: Are our investments performing appropriately given our goals and level of risk? Are fees reasonable, transparent, and competitive? Is our advisor proactive and responsive? Does our investment strategy continue to support both present ministry and future sustainability? Regular review is not a sign of mistrust. It is a sign of responsible oversight.
Most church-held endowments and long-term funds are governed by the Uniform Prudent Management of Institutional Funds Act (UPMIFA), which calls governing bodies to act with reasonable care, skill, and caution. UPMIFA emphasizes thoughtful decision-making that considers the purpose of the institution, the purpose of the fund, risk and return objectives, diversification, liquidity needs, and the impact of costs and fees. It does not require churches to achieve the highest possible returns, but it does require that decisions be intentional, informed, and well-documented as part of an overall strategy.
Many churches are blessed with members who work professionally in finance, investments, or accounting, and some congregations ask an internal lay person to serve as the church’s investment advisor, managing funds directly or guiding investment decisions without an external firm. This can be a true gift. It often reflects deep trust, generosity of expertise, and a shared commitment to the church’s mission, and it may offer accessibility and reduced costs. At the same time, this arrangement requires extra care. Even with the best intentions, risks can arise, including real or perceived conflicts of interest, difficulty providing independent oversight or challenge for fear of upsetting or even losing a church member, limited benchmarking against external providers, informal documentation, and an unhealthy concentration of authority. In addition, internal advisors may unknowingly assume personal fiduciary liability without the protections typically provided by professional firms. Clear structures, written agreements, transparency, and independent review help protect both the church and the lay leader serving in good faith.
One practical way churches demonstrate prudent oversight is through structured evaluation processes such as Requests for Information (RFIs) and Requests for Proposals (RFPs). An RFI allows a church to learn about available services, investment approaches, and fee structures, often validating or benchmarking a current relationship. An RFP is more detailed and typically asks advisors to propose an investment strategy aligned with the church’s goals, clearly disclose all fees, explain risk management and reporting practices, and describe how performance will be measured. Importantly, issuing an RFI or RFP does not require changing advisors. Often, it strengthens confidence in an existing relationship while fulfilling fiduciary responsibility through thoughtful documentation.
Faithful stewardship is not about chasing returns or second-guessing volunteers. It is about aligning financial resources with mission, honoring donor intent, protecting the church’s witness, and ensuring that decisions can be clearly explained and supported. If a church has not reviewed its investment advisor, performance, or fees in several years, now may be an appropriate time to do so. Thoughtful evaluation is not a sign of concern; it is a sign of maturity, transparency, and faithful care for the resources entrusted to the church.
Faithful stewardship calls churches to balance trust with accountability and gratitude with good governance. Periodic review of investment advisors, performance, and fees is not about questioning past decisions—it is about honoring the responsibility that comes with managing resources given for God’s work. The Foundation remains available to assist churches with this process, and with many other areas of ministry and financial stewardship, as congregations seek to align today’s decisions with mission and faithfulness for the future.