Palm Harbor Worship
Members lead worship at Palm Harbor United Methodist Church. (PHUMC photo)

June 7, 2022

Greater returns energize ministries for long haul

By: Connor Murphy

Rev. Jose Nieves
The Rev. Jose Nieves (second from left) and staff at First United Methodist Church in Kissimmee kick of their Easter “Christ is Risen” social media series in 2020. A changing community and the disruption of the COVID-19 pandemic prompted the congregation to rethink how they could be better stewards of church resources. (FUMCK photo)

First United Methodist Church in Kissimmee has changed a lot in its 138 years. So has the community surrounding it.

For many years, Kissimmee relied heavily on agriculture. Some of that heritage remains today.

“Kissimmee was primarily the post where cattle were exchanged,” said the Rev. José Nieves, lead pastor at the Central Florida church. “We celebrate Rodeo Day instead of President’s Day. There’s definitely a part of the history of the community.”

But during the past 30 years, the community has grown more multicultural, with a large population of people moving to the area from Latin America and Puerto Rico. The economy has also become more diversified, with residents today working in a variety of industries. The most common are retail, accommodation and food service, and arts and entertainment, according to Data USA.

With this change, Nieves recognizes there must also be a shift in how the congregation views its resources. It can’t rely on member giving the same way it did in the past.

“If our community is primarily made (of) or has a significant amount of single mothers, we cannot expect a single mother to contribute at the same level that other members of our community are contributing,” Nieves said.

One new strategy is investing money in the Florida United Methodist Foundation’s long-term fund — to earn a return that can fund ministries well into the future.

“This allows us, as a church, to be able to minister to the community that we have, as opposed to the community that maybe we had 30 years ago,” Nieves said.

Disruptions, insight prompt new approach

The pandemic has also challenged the congregation to rethink its ideas about managing money and financing ministry. An accountant helped the church navigate through that process.

Nieves and the church staff also began reading “The Coming Revolution in Church Economics: Why Tithes and Offerings Are No Longer Enough, and What You Can Do about It” by Mark DeYmaz.

“This book really helped us to rethink of our finances. … (It’s) kind of putting a vocabulary on what we already had discussed,” Nieves said.

The reading prompted them to look first at the church’s investment funds, which included money in the foundation’s balanced growth and Development funds. Church leaders realized they weren’t maximizing potential returns over the long-term and decided to move the money to the foundation’s new long-term fund, a more aggressive option designed to provide higher returns over an extended period of time.

“So that really helped us to think, ‘OK, if that fund is able to contribute that much in perpetuity, why are we not using other resources of the church in that way?’” Nieves said.

The church will use its earnings to fund scholarships for mission trips, capital improvements, and church building maintenance and improvements. It also has an account for discretionary spending.

“It’s going to help us as a church to be able to move forward and think long-term,” Nieves said.

In it for the long haul

The long-term fund was added to the foundation’s FUMF Funds last year as part of the transition to CAPTRUST Investment Advisors. The last quarter of 2021 was the first to provide results.

“It did what we wanted it to do,” said the Rev. Mark Becker, the foundation’s president. “It was the best performing of all (our funds).”

Becker and the foundation’s investment committee were not surprised that it and the other funds in the foundation’s portfolio followed the downward direction of this year’s bear market during the first quarter.

“(The long-term fund) allows us as a church to be able to minister to the community that we have, as opposed to the community that maybe we had 30 years ago.” — Rev. José Nieves

“And that’s okay because that’s what we knew going into it,” Becker said. “Risk and return are linked. You really need to be in that one for the long term and don’t worry so much about the ups and downs because they’re going to come.”

A portion of the assets in the foundation’s other FUMF Funds — balanced growth and aggressive growth — are invested in fixed income, or bonds, to counter market swings.

The long-term fund, however, is all equity, with 75% of its assets invested in U.S. and international equities — also known as stocks — and the remaining 25% in real estate and alternative investments. With no fixed income component, the fund more closely follows broader stock market trends.

Becker describes how funding an endowment, for example, would previously have been 60% in stocks and 40% in bonds. But in today’s market, with bond interest rates so low, it’s more difficult to earn satisfying returns over the long haul. That’s why more investors are looking toward the equity market.

“There’s this flight to equity that is part of what’s jacking the indexes,” Becker said.

Churches that invest in the long-term fund can expect to earn higher returns than provided by the other FUMF Funds.

“We are still convinced that the markets will appreciate over the long haul, and you have a much greater chance of significant long-term appreciation if you look at the long haul,” Becker said.

Investing for next generations

Palm Harbor United Methodist Church is also looking to the long-term fund to support its ministries.

Those include two schools — The Robin’s Nest for preschoolers and Westlake Christian School for children in kindergarten through eighth grade. Both have helped Palm Harbor become a hub for nurturing youth and supporting family life.

“We get so many families in here,” says William Milano, finance manager at the church. “It’s not just the church — there’s a lot going on here as far as extracurricular activities.”

Children's Ministry
Children participate in a Last Supper and Communion at Palm Harbor United Methodist Church. One of the church’s values is a “continuous focus on the future,” particularly supporting next generations. (PHUMC photo)

The church also supports Kairos Prison Ministry International, which helps people who are incarcerated develop and strengthen their faith. Globally, the church has been involved in supporting Ukrainian refugees, such as by giving to the United Methodist Global Ministries’ Advance Special for Ukraine.

One of Palm Harbor’s values is a “continuous focus on the future,” with a particular emphasis on supporting the next generation.

One way the church continues to realize that vision is by investing in the foundation’s long-term fund. Milano says the growth in their endowment funds allowed them to be more aggressive in their investments.

“We weren’t earning anything on our investments,” he said. “And to be able to be more aggressive and still have that long-term vision definitely was enticing.”

Connectional ties simplify church investing

Nieves believes other churches should reconsider their resources and how they support ministry.

Having the foundation as a partner, he says, is helping the church pivot to new financial realities in their community and continue its ministries well into the future.

“We already have a built-in organization with our own DNA that we can absolutely and completely trust and know that the funds are going to be used in an ethical way,” Nieves said. “They’re going to be used to help ministry in other places.”

And in 2018, the foundation took its fiduciary commitment to investors to a new level by earning the Investment Steward Certification for its investment and charitable gift annuity funds. It has been recertified each year since then.

This seal of approval from the independent Centre for Fiduciary Excellence means the foundation puts the interests of its ministry partners first.

“So to us,” Nieves said, “it’s a no-brainer that this is an excellent choice to be able to continue in ministry of our church.”

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