Helping Ordinary People Be Extraordinary With Their Money
10 Reasons to Pool Your Family Money
Five years ago my family decided to pool our money. This included my siblings and my mother. We decided that our money, and our resources, separately, were not nearly as powerful as they are together.
GROUP ECONOMICS IS NECESSARY FOR GROUP PROGRESS
So we decided to embark on a poignant and specific journey to put a portion of our money together. How we actually went about pooling our money, setting up our monthly meetings, creating bylaws, creating roles and responsibilities, and establishing our purposes for our pooled money, is fascinating and incredibly interesting. But this blog post is specifically about WHY we did it.
We did not establish a Sou-Sou. A Sou-Sou is a tradition in some African cultures where you pool your money and there is a scheduled pay out for the members that contributed. While this is a great traditional practice, we did not have the arrangment of the payout.
At the bottom of this blog post you will find a great article on exactly what a Sou-Sou entails!
In this blog post I want to talk about the reasons it was important for us to put our money together and begin to save and build a sustainable pool of money for our family, and why you should consider doing the same with your family.
Here are the 10 reasons to pool your family money!
1. The opportunity to learn the practice of group economics - This simple concept is crucial, and it's one of the reasons some communities have a hard time becoming effective and competitive. There is power in a circulating dollar that goes from hand to hand and never leaves your family, or your community.
Your money is supposed to be pooled together so that it can work more efficiently. The stock market, banks, mutual funds, index funds, etc., all work off the concept of pooled money. Pooling your family money is an opportunity to learn this skill, and put it to practice.
Click HERE to discuss HOW to pool YOUR own family's money! I'd love to help.
2. Build more collective capital - When you pool your money, you are increasing the power of your money triple fold, and multiplying the possibilities of what you can ultimately accomplish as a group. You increase your investments, your buying power, your acquisition ability, and your control over real capital.
3. In case of a family emergency - Stuff happens. When you pool your money, you build the ability for your family to mitigate risks and cover family emergencies.
When things go wrong, you don't have to get a Gofundme account, ask people for money, or wonder how you are going to bury a loved one. Your family has money that can be called upon if, and when, needed. This can bring dignity, group self-esteem, peace of mind, and pride to your family.
4. Your family has a pool of fun money - Everything doesn't have to be business. Perhaps your family wants to take a family vacation, go to a live sporting event together, a picnic, or anything.
The money is there, available, and ready to be used for fun, if you all decide that's what you want to do with it.
5. Spend regular time with your family - Maybe not the number one goal of a lot of people, but it definitely allows you to stay in touch, in tune, and regularly communicate with your family members that you may not otherwise see very often.
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6. Introduce and build, a sense of organization, stability, accountability, and discipline with money - If you have a family member that has had trouble managing money, then this could be an introduction to managing money that they've never been privy to.
Perhaps it will help them get organized, save for the first time in their life, and take the responsibility necessary to change their paradigm about money. Your family could be the catalyst of a new beginning for one of your loved ones.
7. Help others - We use our pool of money for things like bereavement money for extended family, graduation gifting, life events donations, and other things that go to help people in our family. Perhaps you have an aging parent, or elderly family member, who needs a little bit of help with money from time to time.
Having a pool of money available to pull from can be a tremendous blessing to that elderly family member.
8. Create and build a legacy of family working together for common goals - Nothing can replace the "good" that comes from unity, being on one accord, and coming together around a common purpose. Creating this type of legacy can speak volumes to your family for generations to come.
9. Developing your personal saving muscle - Everyone in your family is not at the same level when it comes to saving money, preparing for the future, or discipline with money. Saving money is just not that easy for everyone, but being a part of a group of family members that is focused on saving money and holds you accountable, can provide a sense of accomplishment.
There may be a family member that needs the discipline that comes with saving money. This could be their opportunity to grow in that area.
10. Collective group education on money topics - It's not often that you have your family together as a captured audience. This is a great opportunity to share knowledge on topics, introduce concepts and ideas, and pass along valuable information to one another.
Click HERE to check out my blog post on the importance of life insurance.
Having discussions and presentations on things like life insurance, individual stocks, mutual funds, ETFs, wills, and estate planning, can be a game changer for a family.
Click HERE to check out my blog post on Estate Planning.
When we pooled our money 5 years ago we had no specific end goal, but what we realized was, it's important to be able to turn to ourselves when money is needed.
We understood that It's important to take the responsibility and accountability for our own needs, through our own deeds.
We work from bylaws, meet once a month, run the meetings using a modified family-friendly version of "Robert's Rules", and focus on business, but always leave time for regular non-business conversation before and after meetings.
Stay tuned to another blog post where I go into detail and specifics about HOW we pooled our money.
If you have any questions, or want more information about what we did, please feel free to reach out and ask me. I'd love to help you and your family.
Please like and share this blog post with your family and friends!
Click Here to learn about the African and Caribbean practice of a Sou-Sou savings club.