Save money the old-fashioned way

Whether you are saving for a holiday, travel or school fees; a little goes a long way. Summer approaches with the temptation to spend a lot because there seems to be more places to be: braai invites, weddings and festivals. Saving at this time can be tough, but worry not, we have the solution.

One heritage that is true to us as the black community that we don’t often take time to recognise has to the culture of Stokvels. A Stokvel is a social system where regular monetary contributions are made towards collective savings, investment or funeral plan.

Stokvels were social hubs formed by our mothers, aunties, and grandmas when they met in support of each other’s broad range of needs, at school or civic meetings, shebeens, church and family gatherings. The support they gave each other was not only monetarily, but emotionally as well. A society is what is known as a branch of a stokvel and it specifically caters to burial support plans.

A society acted as a burial support plan that would collect money for funeral expenses and provide organisational support from the women whom regularly contributed towards it. They would help with the catering and cleaning arrangements leading to the day of the funeral, relieving families of the deceased. This practice still remains today even though many people have formal funeral cover. It is the mutual support and trust that has caused societies to remain a working success.

Take advantage of your social circle and start a stokvel like ‘Vho Mme’ did and still do. You can save for almost anything ranging from groceries, that laptop you really need, to those holiday trips you have been wanting to go for.

Your social circle is unlimited; it includes your friends, roommates, tutorial group, colleagues and relatives. Whether your source of money is the allowance you receive from your parents, a bursary, part-time job or your internship, saving doesn’t have to be so hard. It’s even easier to do with people you trust and can hold you accountable.
This tradition still works .It has been revolutionised by the presence of social media and financial services products from banks and fund managers as a way of managing the administration better.At the heart of the stokvel is a sense of community and planning to physically get together, break bread and share in a good time, whilst looking out for each other.

Whatever your group may agree to save on. Deciding on the purpose or goal of your savings is the first step to starting your stokvel.

After being clear on why you need to save and what for, identify individuals within your circle who share your interest and vision. Invite them to be part of your society/stokvel.

Agree on a realistic amount that you can all contribute on a monthly basis and when you will share the lump sum amongst each other e.g. every month or after every 6 months.

Wherever there are people and money, there is bound to be conflict. To create a strategy for conflict management you can agree on a constitution i.e a set of rules and guidelines for each member to be directed and protected by. This can include how much is contributed and when, where is it contributed, when withdrawals can be made, consequences of failing to contribute and terms of choosing to exit the stokvel.

Whether it is in realising shared goals or cutting costs by giving your pockets more buying power. It is about getting more from what you put in. You can empower yourself and your members with financial education from the internet or you can also make the bank your friend and consult a financial adviser.

Time to try the tried and tested method of saving. What’s your next saving goal? Tell us in the comments.