The best stokvel ideas are always the simple ones. Stokvels are big in South Africa. Many people use stokvels as investment or savings vehicles. But as with everything, using the right vehicle to get to the right destination is the key in situations like this.
My golden tip is to choose people you trust and respect. Choose to start a stokvel with reliable and responsible people. Personally, I would say that you should avoid doing stokvels with family members as money is known it cause irreparable damage to family relationships.
A stokvel is only as powerful as its weakest member.
Before we talk about the best stokvel ideas let us talk about important things to keep in mind.
3 Must Do things for Every Stokvel to be successful.
1. Save the money in a high-interest-bearing account.
Never let your money idle. No matter how small it is, place it in an interest-bearing account so that your money can work for you as a team.
Make sure that at least 3 members need to approve any transactions if the money should be withdrawn. It’s important to put strong security measures around your money.
Remember that the longer you invest money and lock it away the more interest it will earn.
2. Nominate one member to be the accountant.
This person will keep track of all the contributions and investments made. The person can distribute the group financials monthly or quarterly.
It goes without saying that you should pick a group member who is great with money, responsible and you all can trust. This person should have great organizational skills and be amazing at communicating.
3. Agree on a constitution or rules of the stokvel.
This should be the first thing you do as a group.
Decide on the rules that will govern the stokvel. Make sure it’s something that everyone agrees on and can abide by. Make sure everyone understands the rules.
If there are any disagreements please iron them out before the first contributions are made. Talk about penalties if someone breaks the rules and how you will each hold each other accountable.
Discuss the worst-case scenario when someone defaults on payments or passes away. Be as thorough as possible so that you have proper governance around money.
Remember that money is a sensitive issue and a stokvel can either be the greatest thing or the worst thing to happen to you.
Now that we have sorted everything out, let us talk about the best stokvel ideas you can try as a South African in 2024.
7 Best Stokvel Ideas for South Africans in 2024.
1. Money Stokvels
There are many types of stokvels where people contribute money and share it. This is my favorite kind of stokvel hence it is at the top of the best stokvel ideas.
Goal-based savings – Equal money contributions.
The first one is when each member of the stokvel contributes equal amounts every month. Members can decide on a goal and make contributions towards that goal. For example, 5 members can decide they all want to save a total of R100 000 at the end of the year and they can divide that up to see how much each member should contribute.
After a year, that R100 000 plus interest will be divided equally amongst the members.
Each member can use this money to do other things like adding to an emergency fund or making a large purchase like a car or deposit for a house.
Affordability-based savings – Equal savings.
Members can also decide to contribute an amount that each member can afford. This can be R500, R1000, R5000, or even more. This money can be divided equally at the end. Each member must state when they will be able to contribute.
You set up one day or you can give a date range and all payments should be made within that date range.
The trick here is to join a stokvel within your affordability range or stokvel that will help you reach your financial goals.
Different money contributions – Sharing Interest equally.
Sometimes members of a stokvel can save different amounts of money depending on affordability. At the end of the savings period, each person gets all their monthly contributions back and the interest the money has earned is shared equally to everyone.
Remember the more money you save together the higher the interest you will all earn.
Pay a member each month.
In this type of stokvel, each member contributes the same amount of money. For example, a stokvel has 5 members and each month the 4 members pay R1000 towards one member.
This goes on each month in rotation, meaning each member gets the opportunity to receive a total of R4000 when it’s their turn.
2. Grocery Stokvel (Furniture, School Supplies, Livestock)
This is the most common stokvel amongst South Africans. This is where a group comes together and makes equal monthly contributions for the 12 months. During November or December, the group takes all that money and buys groceries/ toiletries/ cleaning supplies in bulk and shares it among the members equally.
Most of the grocery items are non-perishables or long-lasting items like staples, canned foods, or cleaning products. This is a great idea because many shops give discounts to stokvels who buy items in bulk.
For many members these grocery items can last as long as three months into the new year and sometimes even through the first 6 months of the following year.
Some can even buy school supplies (stationary) or furniture with this money. It all depends on the needs of the group members.
3. Property Stokvel
This is one where members contribute money towards buying property and sharing the ownership of the property. Although this is a long-term stokvel it allows you to reach your dream of wealth building while sharing the risks
Sometimes this stokvel can opt to buy property for one individual at a time. Some even help each other build homes with this stokvel.
If this is your interest, make sure you start this with people that you can trust with your life. It is a long-term commitment thing and requires you to have a bigger goal and vision for the stokvel.
4. Debt payoff Stokvel
This one is where people who are struggling with debt come together to help each other pay off debt quickly.
In this stokvel each member contributes an equal amount, for example, R1000 each. There is then a list drawn up of each member. This list will be used to see which member gets paid in which month.
If you are first on that list all the money that was contributed is paid to you. During the next month, the full contributions are paid to the next member on the list. However, whoever receives the sum for that month should take the payout and put it towards one of their debts.
Each member should declare which debt they are paying off and should supply proof that they paid the money towards that debt.
This stokvel means you have a team of people holding you accountable and helping you pay off debt. Many people want to pay off debt, but when they get a lump sum they rarely use it to pay off debt, so this method forces you to be focused on debt payoff.
Final Thoughts
Joining a stokvel is one of the best financial decisions that you can make. Make sure you join the right stokvel that meets your needs and goals.
I know there are many other ideas that you can add to this list of the best stokvel ideas, please share these in the comments section. Let us help each other become financially savvy and build generational wealth.
