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For nearly a century, Lutheran Laity Movement for Stewardship assisted, inspired and trained congregations in important ways. LLM ceased operations on May 31, 2003, but the Stewardship of Life Institute is proud to continue its work by making its web resources available to a new generation of stewards.


Endowment Funds: Hidden Miracle or Hidden Peril

 by Duane Engelhardt

 How well do congregational endowment funds serve God? Can an endowment fund lead to "empowerment"?

 There is over $1 billion in ELCA congregational endowments. What an opportunity to minister, to make a difference, to be "empowered". The $1 billion figure is a current estimate based on reports submitted to the ELCA. If funds already committed in wills and life insurance policies were included, that estimate would be substantially increased.

Many congregations, over the past 15 or so years, have participated in wills emphasis programs, and the insurance industry has undertaken heavy promotions of gifts through life insurance over the same time period and these have been quite successful.

My purpose for this article is to generate a desire to examine the purpose, potential, practice, and problems of congregational endowments and to encourage "empowerment". Let me be clear: I am in favor of providing opportunities and motivation for deterred giving. Experience has shown that such practices have not always provided the results that congregations want or need. This article is an attempt to provide some framework for discussion.

Before you read any further, be aware that this topic is controversial. I have discovered that this topic engenders deep emotions, can divide a congregation, and for discussing it, I have been "shown the door." All one needs to do is to begin to discuss "endowments" with a congregation that has such a fund and you will trigger the same emotions as when we begin to talk about "money" with individuals in the church. Perhaps it is related to the "mine" versus "God's" dilemma that we come face-to-face with continually. Perhaps it is a matter of needing to identify the "purpose" of a congregation or the purpose of "money". Perhaps it is the need to integrate "purpose" and "practice" into "achievement" or "empowerment."

What is the purpose of your congregation? Many mission statements have been written but most, in the end, will relate to the nurturing of faith of the members and to ministry to some part or all of the world.

Congregational purpose generally is related to the rite of baptism where several things happen:

1. We are given the gift of faith.
2. We are given the promise that God will be with us always.
3. We have been reborn.
4. We are given a name.
5. The congregation is charged with the task of nurturing the faith of the baptized.

Our stewardship is our acceptance and acknowledgement of these gifts.

The church's purpose is to nurture the growth in our stewardship, in our acceptance of the gift of faith, and the promise that God will be with us always.

How do we do this?

1. Preaching the Gospel.
2. Singing and playing music.
3. Educating young and old.
4. Motivating the responses of our gifts of time, talent, and treasure.
5. Encouraging the living of lives dedicated to God.

An endowment, like wealth, can be a blessing or a bane. How can it be a blessing? We know that its existence will affect us. We know that there will be new temptations. We know that it will present new opportunities. The mere existence requires that we examine our purpose and our opportunities to live out our faith.

The existence of an endowment for many churches has served as the only means for survival. It allows the congregation to serve where the community does not have the ability to fund itself. (One must ask the question here as to whether this has deprived other Christians of the opportunity to serve with their money and time?)

Many congregations are doing marvelous things with their endowments and are empowered. There is a sense of mission, purpose, and empowerment in these congregations as they reach out beyond their own needs to address the needs of others.

Other congregations are gasping, suffocating, or even dying because of their endowments. Why? Because they have yielded to the temptation that we all have experienced. Let's take an easier road. My experience in meeting with many congregations is that an endowment fund can be a divisive issue. I should add that many endowments carry with them specific, well-intentioned conditions that leave little choice.

For congregations with endowments, I suggest that some questions are in order:

1. Are your endowment practices consistent with your purpose?
2. Do you envision your endowment or future endowment as a means of empowerment?
3. Does your endowment in any way, potentially or actually, reduce member responsiveness or giving?
4. Does your endowment practice encourage additional deterred giving?
5. Are you being asked "Why don't we pay for 'that' out of our endowment?"
6. Is some or all of your endowment being used for current expenses?
7. Have endowments been received or are being received with limiting conditions?
8. Is your endowment protected by your finance committee?

If your answer to any of these questions is a "yes" or a "qualified yes" perhaps an examination or redefinition of practices is in order.

Some practices recommended for discussion:

1. Primary premise "God will be with us always" This gives the congregation empowerment. Luke 6:38, "Give to others, and God will give to you." Indeed, you will receive a full measure, a generous helping, poured into your hand all that you can hold. The measure you use for others is the one that God will use for you. How can our congregation be empowered?

2. All gifts are to be used up over a period of time. In other words, annuitize the gift over a fixed period of time (usually 5 to 12 years). This will result in greater amounts being available, and will generate enthusiasm for greater deferred giving. Choose the time to suit the project. The shorter the better!

3  Commit the funds to projects and causes outside the congregation. This encourages empowerment of congregations and encourages regular giving and growth in faith. Luke 12:32, "Do not be afraid, little flock, for our father is pleased to give you the kingdom. Sell all your belongings and give the money to the poor"

4. Develop guidelines that discourage limitations on future gifts. Who knows what may be needed?

5 Seek ways to release restricted funds now in hand (this may have some legal implications). If there is a legal requirement to spend the endowment for specific purposes, then dedicate like amounts from the tithes and offerings to offset this amount.

6. Seek partners for projects. This can leverage an endowment. Partners may be the synod, Lutheran Social Services, state or local governments, or other institutions in the area.

7. Continue to emphasize empowerment and urge future gifts. We all need to give.

8. Bring your endowment into the life and witness of the congregation.

9. Have finance-oriented people invest your endowment. Have your congregation spend your endowment for you.

10. If you expect deep controversy, invite a qualified consultant from outside the congregation to provide some independent thoughts.

I pray that if I have stepped on any "sacred cows” for you, that you will forgive me, that you will be open to discussion and that you will be empowered to go forth to His will!


Duane Engelhardt of Springfield, N.J., is a past president of Lutheran Laity Movement for Stewardship. This essay appeared in the Summer, 1994 issue of Faith in Action.

© Copyright 1994, Evangelical Lutheran Church in America.
This essay first appeared in the Summer 1994 issue of Faith in Action. Articles from Faith in Action may be reproduced for use in ELCA and ELCIC congregations provided each copy carries the note:
© Copyright 1996, Evangelical Lutheran Church in America. Reprinted with permission.