Do you start every month with the best intentions to save money only to find yourself with an empty piggy bank come the 24th? If so, you are definitely not alone. Saving when you’re a student is often a struggle, especially considering how tight your budget probably already is. Luckily, there is a saving-savvy solution in the form of Stokvels. Never heard of ‘em? Here’s the lowdown on Stokvels and all you need to know.
What is a Stokvel?
A Stokvel is essentially a savings society comprised of a group of people, usually twelve or more, who are all saving towards a common goal. Each member is obliged to contribute a fixed sum of money on a weekly, fortnightly, or monthly basis. The result is the generation of a much larger sum which, when invested, generates a much higher amount of interest in return. Most commonly, Stokvels are created in an effort to make the most of compound interest and the money is paid out to each contributing member of the group at an agreed-upon time.
Did you know that Stokvels are also proudly South African?
How to set up a Stokvel
If you are keen to take advantage of the benefits of a Stokvel, you will be pleased to hear that it is simple to get started. There are a few important points to remember when recruiting members, however. For example, everybody who joins the Stokvel should all be united with a common purpose, such as saving for a mid-year holiday or saving for a 13th bonus cheque in December ahead of the festive season or religious holiday.
It is also essential that everyone is on the same page in terms of how much needs to be contributed, how it is going to be deposited, and when the money is going to be paid out.
Furthermore, you need to ensure that people who you allow to join the Stokvel people you know you can trust. You should also focus on building and nurturing the trust amongst the existing members by being as transparent as possible in terms of things like sharing bank statements regarding the progress of the Stokvel.
Ultimately, if you don’t want to create your own Stokvel, there is also the option to join an already-existing one. Simply Google ‘How to join a Stokvel’ and there will be a host of opportunities right at your fingertips. Just be sure that you verify the legitimacy of a Stokvel before deciding to become a member. As with anything related to finances, scams are rife!