The Tithe Conundrum: Where Does the Money Go?

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The Tithe Conundrum: Where Does the Money Go?

Where does your tithe money go? Until recently I would have glibly answered, “The Adventist Church uses tithe to pay pastors.”

 

But is that where it really goes? I started to wonder when an intriguing math problem occurred to me. If each member gives 10 percent of their income as tithe, 10 members should be able to support one pastor. When you take the pastor’s benefits into account, perhaps 15 members could foot the bill.

 

However, the ratio of members to pastors in North America is nowhere near 15 to one. With about 3,500 congregational pastors for an estimated 530,000 baptized, church-attending Adventists[1], it’s more like 150 members per pastor.

 

Why such a huge—tenfold—gap?

 

I can think of several possible reasons:

 

  1. Pastors earn far more money than the average church member.
  2. Many church members are not returning tithe at all, or they contribute less than a full 10 percent of their income.
  3. Many church members are giving their tithe to other organizations rather than through official church channels.
  4. Many church members do not have an income on which to pay tithe.
  5. Tithe is paying the salaries of many workers other than church pastors—teachers, administrators, evangelists, etc.
  6. Tithe is used for purposes other than paying workers’ salaries.
  7. Tithe is being used in other parts of the world to support the work there.

 

In this series of articles, I will look at each of these factors in an attempt to solve the tithe conundrum. Where does tithe actually come from—and where does it go? Do we as a church need to implement any changes in our tithing system, either to improve members’ faithfulness in returning tithe or to use tithe more effectively for building the kingdom of God?

 

How Much Do Pastors Earn?

First, let’s clear up any nagging suspicions that Adventist pastors are living high on the hog at the expense of members. (I’m not aware of a groundswell of concern among Adventists about this issue, but I’d better discuss it since I raised the possibility!)

 

For more than a century, the Adventist Church has adhered to a denomination-wide pay scale that seeks to provide employees with a comfortable standard of living without being extravagant. The remuneration scale keeps pay consistent across the division and prevents top administrators from earning many times more than lower-level staff, as is common in the corporate world.

 

The remuneration scale sets a base income (currently just over $54,000 per year) and a salary range for each category of employees, expressed as a percentage of the base. Where a particular employee falls in that range depends on their education, skills, experience, and responsibilities.

 

For a church pastor, the salary range falls between 75% and 102% of the base amount. This means that a brand-new pastor who is not ordained starts at around $40,500 per year, while a seasoned minister with ordination credentials makes about $55,000 per year. This is in line with pastoral salaries in other denominations, as well as typical salaries for workers who hold a bachelor’s degree in the humanities. It is on the low side for people with a master’s degree, which includes about half of Adventist pastors.

 

The base salary can be adjusted upward for areas with a high cost of living (usually urban areas). According to Aaron McNulty, vice president for finance at the Kentucky-Tennessee Conference, each conference determines where cost-of-living increases are necessary using market data provided by an outside firm. His conference currently offers no cost-of-living adjustments, but McNulty believes he may need to implement some due to rising expenses in parts of the territory.

 

Cost-of-living variances can increase a church employee’s salary considerably. For instance, Adventist Today reported a few years ago that because the General Conference is located in the pricey suburbs of Washington, D.C., the world church president at that time made about $87,000 per year—an increase of roughly 50% from his base salary.[2] Seeing that the median home price in Silver Spring, MD, is nearly $400,000 (almost twice the national average), this should allow him to afford a home but will hardly catapult him into the upper echelons of the local community.

 

What startled me about the Adventist pay scale is just how flat it is. A church pastor at the top of the pay range doesn’t get a bit more money by becoming a conference departmental director. A conference president maxes out around $58,000, earning exactly 50% more than the longtime receptionist at the front desk.[3] Even the NAD president earns only a few thousand dollars extra.

 

Top salaries for several types of church employees

 

 

 

 

 

 

 

 

 

Benefits, of course, add to the pastor’s pay package. Having worked for a church institution, I can attest that church employees receive an excellent benefits package, including vacation and sick time, health insurance, retirement contributions, and tuition subsidies for children attending Adventist schools. In addition, pastors typically receive a travel budget to reimburse them for mileage, and they qualify for a federal tax break in the form of the “parsonage exclusion,” which allows them to deduct their housing expenses from taxable income.

 

Surprisingly, a salary of $50,000 per year may put the pastor in the top 30% of wage earners in the congregation. So it seems that the Adventist remuneration scale has met its goal of giving church workers a comfortable living while not unduly enriching them with tithe funds.

 

However, keep in mind that a handful of high-earning members can significantly boost the average tithe per member.[4] Thus we can easily dismiss factor #1 as a major reason why 10-15 members couldn’t support one pastor.

 

In the next article, we will consider the “supply side” of tithing to see if Seventh-day Adventist members are living out their commitment to support the work of the church by returning tithe faithfully.

 

Click here to read the rest of Rachel’s series on the tithe conundrum

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Notes.

[1] The statistic on the number of pastors comes from “Ministry Is Ministry,” Adventist World, March 2015, p. 33. Regarding active members, Robert K. McIver’s study of tithers in the Northern California Conference found that 43% of Adventist members on the books attended the church where they held their membership at least once a month. The total North American Division membership is 1,237,004. See McIver, Tithing Practices Among Seventh-day Adventists: A Study of Tithe Demographics and Motives in Australia, Brazil, England, Kenya and the United States (jointly published by Avondale Academic Press and the General Conference’s Office of Archives, Statistics, and Research, 2016), p. 72

[2] According to today’s pay scale, assuming the cost of living adjustment is the same, he would make about $95,000.

[3] K-12 teachers and principals are on the same scale as pastors; college professors make the same top salary as conference presidents; and even a university president can’t make more than $61,000 per year—a constraint that no doubt hampers the church’s ability to hire qualified personnel in higher education. This information will become pertinent in Part 3 when we look at the percentage of tithe dollars that goes toward education.

[4] This principle is illustrated by the difference between median and mean income in America. Median household income is $56,516 (half of people earn above this amount and half earn less), but the top households earn so much that they push the mean (average) household income to $79,263.

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Rachel Cabose is the consulting editor of The Compass Magazine and a freelance writer. She previously worked as associate editor of Guide magazine at the Review and Herald Publishing Association. Rachel and her husband, Greg, live in Michigan.