What is a Narrative Budget? And why use it?

A narrative budget is a representation of the line item budget in simple, easy-to-read descriptive terms. It transforms a line item of money and expenses into an exciting and enlivening picture of ministries and missional expressions of the parish.

Research studies indicate churches often fail to communicate the value of the ministries they provide and the changes occurring in personal lives through ministries. Contributors, therefore, have a limited understanding of the use of their gifts of relationship with those receiving ministry benefits.

A line item budget is an effective tool for the committee on finance to manage financial resources. It is not an effective means for interpreting those ministries or their impact. On the other hand, the narrative budget helps members of the parish understand what the church is doing in ministry, learning, giving, and mission work. It is connecting link between the giver and the church’s ministries. A well-composed narrative budget will educate and inspire everyone.


  1. Review the line item budget and group budget items by ministry areas, such as worship, education, youth, etc. This could look like the MAP priorities…they could be named creatively – ie; the ministry of our hands- contains salaries and benefits for paid staff, the ministry of our feet – contains money given to work outside our parish, the ministry of our minds – contains the cost of all education work, the ministry of our hearts – contains items of parish and inter-parish social-fellowship life…I love the thought that a parish is the body of Christ, so why not a narrative budget designed in terms of the ministries of our various parts? Much brainstorming and exciting discussion needed here!!!
  2. Review the mission statement. Creatively describe the various ministries of the parish as they fulfill the mission statement.
  3. Consider pro-rating all salaries, building operational costs and overhead as well as program funds into specific areas. We used a chart and gave it to all the employees to fill in their time for a two week period.
  4. Write one or two descriptive paragraphs for each ministry area. Use examples that picture the ministry. Use pictures wherever possible. Enable readers to understand the impact the ministries have in changing lives. Use stories to illustrate the ministry’s effectiveness during the previous year. Picture new or expanding ministry needs as the rationale for increased funding.
  5. Provide a positive, clear explanation of significant funding changes, whether they are proposed increases or decreases.
  6. Expand the reader’s horizons by identifying several relevant and exciting additional future ministries that could be undertaken with funding beyond the budgetary financial projections.
  7. Consider a pie chart that uses ministry areas to depict the budget visually.
  8. Prepare the narrative budget in an attractive, inviting, readable brochure format.
  9. Determine ways to use the narrative budget most effectively to communicate the exciting message of ministry throughout the parish.