Saving has all the time been a problem for me. Whereas I repeatedly utilized the pay-yourself-first precept to my funds, I struggled to stay to my funds.
So after I needed to start out a cake-decorating enterprise, I wanted one other method to cowl my startup prices. I most popular to not take out a mortgage due to curiosity fees.
A co-worker recommended beginning a sou-sou.
What’s that? you’re questioning. Properly, learn on.
What’s a Sou-Sou?
A sou-sou is a straightforward financial savings plan.
The West African custom, which can also be standard within the Caribbean, requires a gaggle of individuals to contribute a hard and fast amount of cash both weekly, bi-weekly or month-to-month to a gaggle account, with one member accountable for accumulating the money.
The group holds a random draw to find out the order by which every individual will obtain their lump sum fee. Nevertheless, as soon as every individual receives their money, they nonetheless should contribute till everybody will get paid.
A sou-sou may run for six months or as much as a yr — all of it will depend on how many individuals are in on it. Sou-sous proceed till everybody receives a payout not less than as soon as.
How I Used a Sou-Sou to Begin a Enterprise
Right here’s how I began a sou-sou to assist me make sufficient cash to get my cake-decorating enterprise off the bottom.
Decide How A lot Money You Must Begin Your Enterprise
I created a listing of provides I’d want, then calculated the full price of shopping for them. This helped me ensure that I’d be capable of get began as soon as I acquired my payout.
Subsequent, I shopped round to search out the perfect costs — then requested distributors a few low cost for purchasing in bulk. It by no means hurts to ask! It helped me save 20% of the unique price after I ultimately purchased the whole lot.
Discover Money in Your Finances and Earn Further Cash
I wanted to unlock some cash to go towards my sou-sou, so I made a decision to remove one invoice from my month-to-month funds.
I in contrast my cable and web payments to see which was costing me extra, after which canceled my $50 per 30 days cable service.
To earn further money, I offered muffins at group occasions at a lowered worth.
Take into account how you may earn a number of further {dollars} a month for your small business. Take into account this listing of 43 methods to save cash quick.
Kind a Group
Everybody in my division had beforehand been concerned in a profitable sou-sou, and since we had been all working towards monetary objectives, it was straightforward for the workforce to get on board.
A complete of 10 colleagues joined the sou-sou, however you can begin one with any variety of folks. Ask co-workers, kin and fellow church or gymnasium members if they need in.
Select a Money Collector
We nominated my supervisor as money collector and positioned our cash in a locked field in her workplace. Two folks needed to be current when cash was deposited or paid out.
Since all of us earned month-to-month salaries, we selected a deadline for everybody to pay up.
My supervisor was additionally within the sou-sou. If the individual accumulating the money isn’t in on it, they’re generally paid a proportion by every member. If my supervisor hadn’t been a member, she would have acquired 5% of our earnings for managing the sou-sou.
Determine on a Affordable Contribution
We thought of our closing targets and unanimously selected a practical quantity every individual would pay.
With 10 members, we determined to every contribute $100 per 30 days — that means we’d every get a $1,000 payout.
A number of members had been unable to contribute the complete quantity, in order that they joined with one other member to every contribute $50 per 30 days. When their payout time got here, every individual acquired $500 — a 50% payout.
I made a decision to double my contributions and pay $200 a month, that means I’d get two $1,000 payouts to assist me fund my enterprise.
Suggest Accountability
We recommended every individual within the group be accountable to a different member to verify they spent their cash on fulfilling their objectives.
For instance, I selected an accountability accomplice who would ensure that I invested my $1,000 in my enterprise.
If I didn’t, I’d should pay my accomplice 20% of my payout — an enormous quantity we selected to assist encourage me.
How My Sou-Sou Labored Out
Our sou-sou started in January and I acquired my payout in Might. Since I doubled my contributions, I acquired one other payout in November, which I additionally put towards my enterprise.
The group initiative was an enormous a part of my motivation, and everybody agreed that having the help of different members of the sou-sou was essential to our success.
My selection to make use of a sou-sou relatively than take out a mortgage paid off. I didn’t owe the financial institution any cash, and I saved $200 I might have paid in curiosity fees.
With the help of associates or household, saving cash to start out a enterprise is attainable. Making $100 or $200 contributions could not look like a lot, however with time, it may very well be sufficient to get your small business off the bottom or assist develop it with out a mortgage.
Editor’s word: This submit was initially printed in 2016.
Kerry Mc Donald is a contributor to The Penny Hoarder. Freelancer Kent McDill contributed to this report.
