Ajo or savings might sound alike but then they are really different. This is one only a few people know about. But before I start to talk plenty, lemme explain the two.
This is a year of plenty plenty resolution for so many people. Some counted millions they will have by the end of the year.
Others counted what they want to buy. Most of them filled church baskets with the end of the year requests and wish lists.
Yes I called it wish list, cos having goals without plans is nothing but having huge lists for a waiting star, cos I am sure no god of any religion would grant wishes to someone who never worked!
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In finances, many people use different methods to scale. In Nigeria, there are two kinds of people? – The business people and the working-class people.
Now the working class people normally use Ajo while the working class use Akawo (savings).
What is Ajo (Contribution)?
Ajo is a financial circle that involves members of the circle receiving money from the other members in turn, till everyone have collected.
For instance, there are 10 persons in an office and 10 of them agree to start an Ajo. In January, they all contribute N20,000 to Mr A. He receives 180,000 to combine with his N20,000 and he has N200,000.
February, the same thing is done. Only this time, who receives is not Mr A, but rather Mr B; and the cycle goes on till the 10th month.
What is savings (Akawo)?
Savings, also called Akawo in some parts of Nigeria, is a style where people do save on either a weekly basis or on a monthly basis.
This style is usually used by Small and Medium Enterprises (SMEs). Sometimes used by the big guns, but that is not the reason for this post.
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Why do people like Ajo?
Observe carefully and you see that people who like Ajo (Contribution) are those whose finances rely on a salary structure.
So many times, they find it hard to gather funds at a time, so they choose to do this circle thing. So that once in a year they can receive bulk money at a time instead of being split and spread across a period of time.
Why do people like Savings?
People who take this one are those who are scared of the month ending and then they won’t know the result of the business. So they task themself on a certain amount and save, no matter the condition.
A thermostat is a machine that helps to maintain the temperature of a room within a range. One which if the room temperature rises above the set range, the thermostat brings it down.
Or if the room gets colder than the set range, the thermostat brings the room temperature up to that amount.
This financial thermostat is all about your mind. When your thermostat has been set on a certain amount. If your finances ever go above it, you will want to spend till your finance falls within your range.
If 20k is above your thermostat, if you have 30k, you will want to blow that 10k. Now one of the facts of wealth is that it is measured in potential and not spending, but those who do Ajo find it hard to save.
Take your money off from Ajo
I know different things work for different people. But Ajo doesn’t increase your financial thermostat, and if you did collect first, you start feeling like you are in debt.
So at the end of this, which do you really think is better?
Share your ideas in the comment box with me, so I get to know I am not alone in these thoughts.