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Managing a Chama

Quote of the Week: “When there is no enemy within, the enemies outside cannot hurt you.” Sir Winston Churchill.

The investment journey is not easy. That’s why it’s important to join hands with like-minded individuals to achieve your goals. Even then, it never gets easy. Investing can be difficult at first especially if you have not outlined your financial objectives carefully before hand. You need to be very disciplined to reach your goal as a group. And the discipline must be collective.

Many investment groups start based on friendship (or family ties) and trust between the individuals who have come together with a common interest to better themselves either by investing together or saving for a goal.  Therefore, the first step to take as a group is defining the destination of the group, which becomes the long term goal for the goal. Define a path on how to reach your goal and the resources you will need to do so. Below is a guide on how to manage a successful chama.

  1. Define Your Goals

At the onset, it is worthwhile to state the group’s objectives as a whole. You need to bear in mind that due to the group’s diverse personalities, the group members can be your own worst enemies and a loosely defined goal may provide loopholes for unnecessary disharmony and compromise the progress of the overall goal of the club.

Avoid factoring in personal agendas during meetings since it may lead to lack of focus on key issues, confusion and eventually, apathy. The unity of the group should be based on a common purpose. The decision making power of the investment club resides in its democracy. Each member brings his or her own knowledge, experience and skills to the group. Harness that collective strength to achieve your goals.

  1. Be Disciplined

There are clear benefits to the discipline involved in making contributions and investments as a group. By maintaining a strict rule of regular contributions, chamas cause individual investors to adopt an active investment style.  The motivation of reaching the target as a group makes the strategy more exciting. Your chances of success should increase if you stay on course without letting your emotions and diversity of personalities get in the way.

One more thing. Never keep your money in an idle account. Always ensure that chama funds are in a place where they earn competitive interest so as not to lose value to bank charges and inflation. An example of such an avenue is the Zimele Savings Plan, which also provides membership for groups and chamas.

  1. Learn

Investment clubs that operate with the primary goal of educating their members about investing have higher chances of success and longevity. Even the most experienced, longest-standing clubs are constantly striving to learn more about financial markets and investing.  This will keep the group focused on optimizing their goal with the gains they get from the market. It will also help members improve their personal finance skills. Make sure all members understand and agree on investment strategies right from the start. Your group must have a common purpose, every member should actively participate in researching about investment options, and other general activities.

  1. Review Progress

A typical chama will meet on a regular basis, usually once a month, to review its investment portfolio and to take suggestions from members regarding new investment opportunities. The monthly meeting should be an open floor, where each member is able to voice his or her opinion about the suitability of new investments and other concerns regarding the performance of the pooled funds.

The collective wisdom of the members, combined with information they have gathered through extensive research, usually results in more prudent investment decisions.


Uniting together for a common goal means that an individual will get the adequate support they need in their investment endeavors. Many start investing but gradually slow down due to lack of consistency and commitment. Chamas provide an opportunity to create a transparent vehicle for pooling resources and ideas since all members are accountable to each other, which is important in planning investments and increases the group’s chances of reaching their goals.

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