As we begin the new year, it is important to consider strategies that can help us succeed and find financial relief throughout the year. By doing this, we can avoid the stress and financial burdens of January. Choose the best savings method for great benefits.
Many South African consumers face financial difficulties and struggle to save. By forming a good financial habit of saving, you benefit yourself, your family, and future generations. Interestingly, consumers have adopted diverse saving methods, such as a Stokvel.
Saving allows you to have a safety net for unexpected expenses and provides financial security. Whether you choose to save through a Stokvel or a tax-free investment, finding the right saving method will help you achieve your financial goals.
The Stokvel industry is a savings method that offers valuable support to many South Africans who struggle to save. This is even more aparent during these challenging economic times, where every penny saved is crucial.
A Stokvel is a group of members who come together with the common goal of saving money or reaching a specific amount by the end of a saving period. Once accumulated, the amount is evenly distributed among all members. The Stokvel industry valued at R45-billion, highlighting people’s interest in saving, investing, and working towards a common goal.
The booming Stokvel industry has even piqued the interest of South Africa’s top financial institutions. Many of them now cater for Stokvel clubs, offer advice on how they operate. Reputable banks such as FNB, Nedbank and Standard Bank, have included stokvels as part of their portfolios.
- Rotational Stokvel Clubs: members contribute a set amount of money each week or month. Then, members take turns receiving a lump sum and can use the money as they wish.
- Grocery Stokvel Club: the grocery club is a way for members to contribute a set amount of money that is then used to buy groceries at the end of the year.
- Investment Stokvel Club: an investment club provides individuals with options to explore, such as earning interest, investing in stocks, or starting a business venture.
- Borrowing Club: members contribute a fixed amount and loan it out to others at a high interest rate, ensuring sustainability and profitability.
- Social Clubs: this Stokvel is for members who organize entertainment activities or events. Group members contribute money towards these activities/excursions like Kilimanjaro, Vacation, Skydiving, Cruise ship, etc.
If you struggle to save and invest money due to financial constraints, find areas to relieve debt burdens. By doing so, you can contribute towards your future savings and investments.
Vantage can help you by providing a free financial assessment to determine if your debt is becoming too much to handle, and offer valuable guidance on how to enhance your financial situation.