Questions & Answers About Debt Reduction Appeals

Three congregations contacted us about Debt Reduction Appeals this past week. The following questions were on their minds:

  • We had a capital campaign three years ago and our pledges are about to run out. Should we roll the remaining debt into our operating budget?
  • We are at the end of our second Debt Reduction Appeal and still have debt. We fear people will experience appeal “fatigue” if we roll out another appeal. What should we do?
  • Is it wise (or not) to launch a Debt Reduction Appeal during Covid-19?

These are good questions. Here is our experience with Debt Reduction Appeals.

  • Congregational leaders usually want to roll the debt payment into the operating budget for one of two reasons: (1) They do not want to invest the work in conducting another appeal, or (2) They assume that donors are “tired” and want a break and/or will not give to another appeal. In each case they are making a mistake.

Leaders need to fully grasp the stress that a mortgage payment can have on the operating budget and the on-going ministries. Leaders also need to fully grasp the large amount of interest expense that would be paid if the mortgage is not aggressively paid off.

  • Rule-of-Thumb: If your mortgage is equal to, or more than the total of your annual offerings, you need to launch a “full blown” Debt Reduction Appeal.

If someone experiences “donor fatigue” and chooses not to make a commitment, there is always the potential of engaging a contributor who is new to the congregation or who has not contributed in former appeals. However, if you don’t ask you won’t find “new” contributors.

  • Covid-19 is not a good reason for not addressing your debt. No doubt, Covid-19 has impacted many households. But the past half-year has also demonstrated that members continue to reflect their love for their church through their generous offerings. If the members understand the importance of the church’s debt reduction efforts, they will support it to the best of their ability.

Covid-19 will be under control at some point, but if you are faced in the future with mortgage payments that are parked in your operating budget, stressing your budget and your ministries, your “next normal” will be even more challenging!

  • If you are coming to the end of a current debt reduction campaign, and are still inclined to roll your remaining debt payment into the operating budget, then conduct a special appeal asking members to roll a portion of their campaign giving into their regular offerings.  We have assisted churches in this effort, and at times have seen an increase in regular giving as much as 40% or more.  However, this approach requires an intentional “full blown” Annual Stewardship appeal every year in which the needs of the church (including staying in front of the debt payments) is clearly communicated. Failure to conduct intentional Annual Stewardship appeals will result in overall drops in giving, which will lead back to the stress of the debt payment choking your ministries.



We can help! Your Next Step:

  • Express your interest in setting up a complimentary one-hour consultation by emailing us at One of our Response Team Consultants will get back to you to set up a time.
  • Or maybe you prefer asking a question by email. Send it to the above address and we’ll get back to you.
  • If you would like to receive help beyond a complimentary call, we have longer term options available that can be discussed.

We look forward to hearing from you!

Fred Stoltz, Sr. Program Director
The James Company
(414) 690-3426