The good old stokvel combines the spirit of Ubuntu with power-packed saving potential. Meet some women who are tapping into saving together… By Lisa Templeton
The stokvel is alive and well. In fact, the current estimated value of the South African stokvel market is a whopping R45 billion, with some 811 800 registered stokvels with over 11.4 million members – a fifth of our population. Often accused of being a nation of non-savers, the stokvel shows that SA still has a unique way to save money in a communal fund to invest or to save – for anything from food to funerals, school fees to manhood initiation and property to business enterprises.
‘I bought a piece of land in two years with money I saved’
Prudence Radebe, 29, runs a non-government organisation
I belong to four stokvels, all of which serve different purposes, but the main stokvel is the one with which I saved to buy a plot. I am now saving to put a small block of flats on it to rent out. There are 11 members and we put in R10 000 a month, and each month someone gets the full R110 000 in cash. You can choose which month you withdraw your money. I saved this money for two years and added savings from other stokvels to the R220 000 to make up the R280 000 I needed to buy my plot. Within two years, I owned land, paid for in cash with no money owed to the bank or interest to pay off. Most of us in the stokvel have bought land, but there are also taxi drivers who save for the down payment on a new vehicle. We have had no trouble with non-payment by members, because most members have been involved for a long time now, and we all own land. If someone didn’t pay, they have an asset we could make them sell.
I also belong to a ‘Frozen Stokvel’ with 45 members where we all put in R400 each month and buy frozen meat, for example, at the year end; a grocery stokvel (R500 a month for 10 months) to bulk buy food – I have yet to shop at a supermarket this year – and also a brandy stokvel to which we contribute two bottles a month. With this, we are helping a mother who needs to send her son on initiation and it costs a lot. All of us are parents with sons and will get our turn to claim the gift of brandy to pay towards the initiation.
What I have learnt Stokvels are truly amazing. It is not just about saving money – although we could not do it on our own. It is about incredible women coming together and sharing ideas and advice. It is both exciting and inspiring.
‘We save so we can treat ourselves’
Marie Loubscher, 44, artist
We are 10 moms and we started our stokvel for fun. On the last Thursday of every month, we meet at the coffee shop at our local nursery and we each put R150 into the pot. At the start of every 10-month cycle, we each draw a month out of a cup, and when we meet in your month you will get the
R1 500 to spend on what you want – and you are not allowed to pay for anyone else’s coffee! The money is just for you. It is really mostly a way of saving a bit and being able to treat ourselves.
When it was my turn, I did have to spend a bit on all the usual house-hold stuff, though we are supposed to just treat ourselves, but I did get a new pair of jeans and a pair of sunglasses out of it.
One mom says it is always her turn just as all her beauty products run out, so that is what she ends up spending her money on.
What I have learnt You have to have people in your stokvel you can trust. We are all friends and family members and we all know that even if someone gets the first R1 500, they will still keep coming back to pay off their due.
‘We pool our money to bulk-buy groceries’
Thobelani Bhuku, 35, domestic worker
Our stokvel gives us the opportunity to save a full year and do a big bulk shop in December, which gives us the power to really look for bargains and negotiate with the megastore we buy from. We love getting the best deal possible when we can.
Our group has been going for 10 years. We have 110 members and we all put in R100 a month for 10 months (we take a little break for the months of December and January).
Even so, this means we accumulate R110 000 by the end of the year. We have a separate bank account for the stokvel and three people to manage it, so they can each keep an eye on it. We put in an order to the store, with whom we have always dealt, and they gather our goods, such as sugar, rice, sunflower oil, flour, maize meal, tinned tomatoes and loads of other groceries. We are lucky, because the store will deliver to us on a weekend when most of us aren’t working, and we like all the members to be present when we divide up the goods.
What I have learnt Doing a bulk shop not only gets us far better deals than we could on our own, but it also takes the stress out of grocery bills. If we are careful, the groceries we buy can be made to last a long time. It is a huge help. Lots of our members have very little money and live in the informal settlement and are responsible for feeding people in the community.
The key to a happy stokvel
Have solid ground rules and get every member to agree to those rules – get signatures to formalise the agreement.
Use your payout well
When it is your turn to get a payout, resist the temptation to spend it on unnecessary items. Rather, try using it to reduce any debt you may have, or to establish an emergency fund, which has to be easily available and only used for a crisis, such as retrenchment, a sudden medical bill
or a funeral.
Maximise your stokvel savings
Use pre-existing infrastructures in place; stokvels are big business and people know it. Many banks offer accounts geared to stokvels. Look for an account that will both pay interest and allow for three signatories, but won’t charge you maintenance or transaction fees. Big stores where you can buy in bulk can also help grocery-stokvel customers, be it via placing orders, getting the best deals, affordable transport or payments made with deposits rather than cash.
Club together to invest your money
There are stokvels that pool their monthly contributions and invest it to make more money. Some options for investment vehicles include unit trusts, exchange traded funds or shares, property, government bonds or retail bonds. Get advice on this from a professional financial advisor and get investing.