GrowLeader Podcast Episode 64 | Norwood Davis – Building Strong Financial Foundations (WIF)
Release Date: October 21, 2024
Host: Pastor Chris Hodges
Guest: Norwood Davis, President of Wesleyan Investment Foundation (WIF)
Co-Host: Matt
Overview
In this episode of the GrowLeader Podcast, Pastor Chris Hodges and co-host Matt are joined by Norwood Davis, President of the Wesleyan Investment Foundation (WIF). The conversation centers on how church leaders can establish strong financial foundations to support their vision, particularly when it comes to building projects, managing finances, and preparing for growth. Both practical tips and deeply rooted wisdom are shared—from personal experience to overarching strategy—aimed at helping church leaders not only dream big but also execute those dreams responsibly.
Key Discussion Points & Insights
The Importance of Financial Health in Fulfilling Vision
- Monday Matters: Norwood emphasizes that decisions made during the week (on “Monday”) are crucial to living out the vision cast on Sundays.
“It gets back to the decisions people make on Monday—really impacts how the vision that they've cast on Sunday is lived out.” (A, 00:00)
- Where churches bank, invest, and spend matters for the Kingdom.
Norwood Davis’ Background & Heart for Ministry
- Humble beginnings, career as an engineer, and a shift into church ministry after a “profound encounter with the living God.” (A, 03:49)
- Served as CFO at 12 Stone Church, moving from a department of one to overseeing a multi-campus operation across 17 years.
“When I started, I was a department of one... we were one campus and grew along the way...” (A, 04:50)
- Personal note: Married 30 years, family milestones upcoming.
The Wesleyan Investment Foundation: Mission & Reach
- History: Founded in 1946 as a church extension loan fund, originally serving the Wesleyan denomination, now expanded to serve over 1,400 churches in 42 denominations across all 50 states. (A, 07:35)
- Loans range from $5,000 to tens of millions for property, renovation, and building projects.
- Deposits: Individuals and churches can make deposits; current rate is 5% for investments over $35,000.
- Funds are cycled back into Kingdom work; interest paid on loans funds new church projects.
“When you pay back the loan … that money has been being taken and given to churches.” (C, 09:15)
- Funds are cycled back into Kingdom work; interest paid on loans funds new church projects.
Key Metrics for Church Financial Health
- WIF looks for:
- Personnel costs at 35-40% of budget
- Debt service maxed at 15-20%
- Strong participation in tithing and giving
- Outward generosity: “How much are they giving outside the church?” (A, 06:37)
- These principles are used to quickly assess thousands of churches for financial strength and lending readiness.
The Value of Margin
- Margin Defined: Uncommitted income, distinct from savings; money that isn’t immediately spent.
- Example: Church of the Highlands budgets only 90% of previous year’s income, always retaining margin.
“Margin isn’t necessarily savings. It’s just money that we don’t have to spend… margin.” (C, 15:18)
- Today, Highlands runs at 64% expenditures of giving, keeping 36% as margin. (C, 15:18)
- Example: Church of the Highlands budgets only 90% of previous year’s income, always retaining margin.
- Practical Takeaway: If 36% seems impossible, start with 1-3% and build over time.
“Just add a percent to it every year... you’ll be amazed what happens.” (A, 17:02)
Steps to Building Financial Foundations for Church Growth
1. Put Things in Order
- Ensure proper accounting: No vague expense categories like “credit card expenses.”
- Use available tools (QuickBooks, volunteers, affordable bookkeepers) regardless of church size. (A, 14:15)
2. Count the Cost
- Plan for 3–5 year building or project timelines.
- Calculate how much you're truly able to borrow and afford; typically, can borrow up to 3 times trailing twelve-month income, with 20–25% down.
“If a church had... $500,000 [in annual revenue], they'd qualify for a loan of $1.5 million.” (A, 19:13)
3. Prepare Yourself as a Leader
- Equip yourself spiritually, physically, and intellectually for the significant journey of leading through change.
- Read about leading change; get ready for the long haul. (A, 20:09)
4. Prepare the Team
- Vision must be carried by the team, not just the pastor.
- Team members (staff and volunteers) must be equipped and invested in the stewardship and dream.
“You can, you know, pastor cast the vision, but there's got to be a team that'll carry the vision.” (A, 23:11)
5. Prepare the Church
- Share the “what” and the “why” of the vision.
- Invite participation, help members imagine the impact, and communicate how it serves those not yet present.
- Vision casting should be both exciting and ennobling.
“It needs to be exciting… but it also needs to be ennobling. This is what heaven counts. This is what we’re going to stand before God and be proud of.” (C, 24:32)
Practical Tools & Resources
- WIF Application Process: Easy online access; mobile-friendly for both borrowing and investing. (A, 10:37)
- Learning from Others:
“Every time I'm going to do something that's new for me for the first time, I'm going to go find three to five people who've already done it and go learn from them.” (C, 22:02)
- GrowLeader and ARC offer networks for mentorship and best practice sharing.
Notable Quotes & Memorable Moments
-
On Vision & Stewardship:
“We want to save marriages. We want to reach young people. … Imagine with me this space with thousands and thousands of people who are finding Jesus for the first time and the ones who are finding freedom from addictions.”
– Pastor Chris Hodges, 24:32 -
On Flexibility with Lending:
“We’re not locked into a strict box. … We don’t have covenants that really seek to get into the pulpit or into the boardroom of the church.”
– Norwood Davis, 12:11 -
On Building Margin:
“Of course, there’s only two ways you can create margin, and that is the income's gotta go up and the expenses have to go down.”
– Pastor Chris Hodges, 16:45 -
On Church Member Involvement:
“You’re leading through teams. … You can, you know, pastor cast the vision, but there’s got to be a team that’ll carry the vision.”
– Norwood Davis, 23:11
Timestamps for Key Segments
| Timestamp | Segment | |-----------|----------------------------------------------------------------| | 00:00 | How “Monday Matters” for church vision and financial decisions | | 03:49 | Norwood’s background and journey into ministry | | 04:50 | Norwood’s tenure as church CFO; lessons learned | | 06:37 | Financial metrics for church health | | 07:35 | Origin and mission of WIF | | 09:15 | How WIF’s loan model supports Kingdom expansion | | 13:22 | Why applications are declined or delayed; setting churches up for financial health | | 14:15 | Practical steps for organizing church finances | | 15:18 | Defining and operationalizing margin | | 17:02 | Strategies for slowly increasing margin year over year | | 19:13 | Lending ratios and practical building cost calculations | | 20:09 | Preparing yourself and the team for the process | | 23:11 | The role of the team in carrying vision | | 24:09 | Preparing the church and casting compelling shared vision | | 24:32 | How to make vision exciting and ennobling |
Final Thoughts
This episode offers a masterclass in aligning financial stewardship with vision for church growth. Norwood Davis' blend of practical guidance, financial discipline, and passion for the church is complemented by Chris Hodges' leadership convictions and personal experience. Listeners will walk away with actionable strategies to assess, reset, and pursue church projects—rooted always in Kingdom purpose.
For more resources and access to the Wesleyan Investment Foundation, visit wifonline.com.
