August 1, 2007 @ 8 a.m – Written by January
One of the best decisions I took in raising money for my investment goals was the idea of a Cooperative Union. It enabled me to raise the initial amount for Union Bank’s public offer. As the dream of financial freedom by Nigerians remains largely unrealized, more people are either forming new cooperative societies or joining existing ones in order to take advantage of pooling resources for investing purposes. Forming a cooperative society is relatively not too difficult because you can pool resources with your colleagues or join existing societies within your workplace.
I recently had a discussion with a friend of mine who stated the inability of her parents to achieve financial freedom due to little or no investment plans. I went further to ask if her parents were members of cooperative societies within their respective workplaces and she said no. After considering their current age (mid –50s) and considering retirement were still some few years away, I advised her to counsel them on the need to get started on the road towards financial freedom. Borrowing from a cooperative society is usually cheaper than the bank due to a lower interest rate, which is usually fixed at 10%. For some societies, it’s much more lower while for some, it’s zero interest. (You may decide to check out what obtains within your workplace). Joining a cooperative society makes the journey much easier and less stressful.
For instance, when my mum clocked 40 years, she had little or no savings due to her job as a lecturer with which she was barely making ends meet. So a friend of hers introduced the benefits of investing using pooled funds from the cooperative society. Both of them registered with the cooperative society within the institution and used the first loan (interest rate @ 10%) they collected to purchase 200,000units of Wema Bank. That was 10 years ago, now back to 2007 – she has grown her net worth through the stock market to 65,000pounds.
The cooperative society remains the cheapest ways of realizing our financial freedom within a developing economy such as Nigeria. This society entails groups of people coming together to pool resources so as to reduce the cost of borrowing from banks. This is the beauty of a cooperative society.