Doss and Donts of Investment Groups

DOS:

1.  Keep the main agenda of investment group meetings strictly to business. Any social agenda can be dealt with after the official business meeting is complete.
2. Use credible professionals to handle your transactions – from accounts to legal matters.
3. Comply with all government statutory and regulatory requirements – auditing accounts every year, paying all taxes due.
4. Proper research and due diligence before making any decision to invest.
5. Keep proper records of all your internal and external correspondence, financial and legal transactions.
6. Set up appropriate (governance) structures to conduct the affairs of the group

DONTS

1. Do not get tempted by “once-in-a-lifetime” investment opportunities.
2. Do not fail to disclose to other group members, family and related parties that are involved with or a part of the investment transaction.
3. Do not depend solely on the advice of someone who is going to benefit from an investment transaction you make, e.g. a stockbroker.
4. Do not let friendship prevent you from having difficult discussions with fellow group members –but think before you speak.
5. Do not give any of your fellow members any reason whatsoever to mistrust you. Once the trust is no more, the group is no more.

BENEFITS OF JOINING A CHAMA

1.  Support system.
   Both financial and emotional. Aside from sharing savings (that you may be allowed to withdraw from) a Chama can be a networking opportunity to make new business acquaintances and make long-term friends.
2. Lower investment risk.
   When you invest in a Chama you are now conducting investments as a group. Therefore, you do not have to take the risk of an investment on your own you have multiple shoulders to help you carry that burden.
3. Learning experience.
   Chamas create the perfect learning environments because they bring together different people with a mutually beneficial goal. In your Chama you will work with people with a whole host of experiences and skills and if you are will, you will be able to learn from these people.
4. Creates a source wealth.
   To create enough capital for projects is much easier as a group. One the investment projects are funded and running the profits earned once reinvested creates long-term wealth for the Chama and the Chama‘s community.
5. Combat the fear of investment.
   Fear of being duped, fear of failing and fear of other risks stop many people from investing. Similar to the safety the buddy system gives you when you go out with your girl the Chama is your investment buddy system.