Saving has at all times been a problem for me. Whereas I repeatedly utilized the pay-yourself-first precept to my funds, I struggled to stay to my price range.
So once I wished to start out a cake-decorating enterprise, I wanted one other strategy to cowl my startup prices. I most well-liked to not take out a mortgage due to curiosity prices.
A co-worker urged beginning a sou-sou.
What’s that? you’re questioning. Nicely, learn on.
What’s a Sou-Sou?
A sou-sou is an easy financial savings plan.
The West African custom, which can be standard within the Caribbean, requires a bunch of individuals to contribute a set amount of cash both weekly, bi-weekly or month-to-month to a bunch account, with one member accountable for gathering the money.
The group holds a random draw to find out the order wherein every individual will obtain their lump sum fee. Nonetheless, as soon as every individual receives their money, they nonetheless must contribute till everybody will get paid.
A sou-sou may run for six months or as much as a 12 months — all of it depends upon how many individuals are in on it. Sou-sous proceed till everybody receives a payout a minimum of 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 entire value of shopping for them. This helped me be certain that I’d be capable to get began as soon as I acquired my payout.
Subsequent, I shopped round to search out the very best costs — then requested distributors a couple of low cost for purchasing in bulk. It by no means hurts to ask! It helped me save 20% of the unique value once I finally purchased every little thing.
Discover Money in Your Price range and Earn Additional Cash
I wanted to unlock some cash to go towards my sou-sou, so I made a decision to eradicate one invoice from my month-to-month price range.
I in contrast my cable and web payments to see which was costing me extra, after which canceled my $50 monthly cable service.
To earn additional money, I offered truffles at neighborhood occasions at a decreased worth.
Take into account how you may earn just a few additional {dollars} a month for your enterprise. 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 have been all working towards monetary objectives, it was simple for the crew to get on board.
A complete of 10 colleagues joined the sou-sou, however you can begin one with any variety of individuals. Ask co-workers, kinfolk 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 individuals 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 gathering 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 Cheap Contribution
We thought-about our ultimate goals and unanimously selected a sensible quantity every individual would pay.
With 10 members, we determined to every contribute $100 monthly — which means we’d every get a $1,000 payout.
Just a few members have been unable to contribute the complete quantity, so that they joined with one other member to every contribute $50 monthly. 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, which means I’d get two $1,000 payouts to assist me fund my enterprise.
Suggest Accountability
We urged every individual within the group be accountable to a different member to ensure they spent their cash on fulfilling their objectives.
For instance, I selected an accountability accomplice who would be certain that I invested my $1,000 in my enterprise.
If I didn’t, I’d must 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 Could. 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 assist of different members of the sou-sou was essential to our success.
My selection to make use of a sou-sou somewhat than take out a mortgage paid off. I didn’t owe the financial institution any cash, and I saved $200 I’d have paid in curiosity prices.
With the help of pals or household, saving cash to start out a enterprise is doable. Making $100 or $200 contributions might not seem to be a lot, however with time, it might be sufficient to get your enterprise off the bottom or assist increase it and not using a mortgage.
Editor’s be aware: This submit was initially printed in 2016.
Kerry Mc Donald is a contributor to The FinanceGrabber. Freelancer Kent McDill contributed to this report.