Pulse Nigeria is the most followed news and entertainment platform, informing and engaging young Nigerians round the clock, providing updates by the hour.

Pulse Nigeria

Ajo can be done among colleagues in the office, traders, members of a community etc. A coordinator is usually chosen among contributors who administers the contributions and hands over the money to whoever is next in line.

Ajo- benefits of contributory thrift saving scheme | Pulse Nigeria

gboyinwa ajomale

<h1>Thrift contribution which is also popularly known as ajo is a contributory thrift saving scheme among a group of people kind of saving scheme a group of people engage in.</h1>

The way ajo work is that a group of people come together to each put an agreed amount of money into savings each month, then at the end of every month, someone in the group then takes all the money saved for that month, which is subsequently rotated among all the group members throughout the period of the monthly contribution.

Ajo can be done among colleagues in the office, traders, members of a community etc.

A coordinator is usually chosen among contributors who administers the contributions and hands over the money to whoever is next in line.

ALSO READ: <a href="" id="eac4786c-9f05-53f6-b750-5e31aa2d2b6e">Reasons why your budget keeps failing</a>

For instance, if there are twelve people in a money contribution group and each month they put in a hundred thousand each into it, at the end of every month each person would be entitled a huge sum of 1.2 million naira.

At the end of the rotation, you can either cancel the contribution or start all over again.

There are lots of benefits when it comes to a contributory thrifting saving scheme.

Here are the benefits of a contributory saving scheme

Thrift contribution teaches financial discipline. For you to consistently take a fraction out of your income and put it into a saving scheme means you have financial discipline.

ALSO READ: <a href="" id="868eacd8-bbe2-530d-95b9-413816a38ee7">What to do if your partner has bad money habits</a>

If you consistently do this, then you become disciplined with your finances which is a plus for your money and savings in the long run.

2. You have no direct access to it

With thrift contribution, you don’t have access to it until you are next in line for the money, unlike your savings which you have access to, which without discipline you will always dip into.

3. It affords you the opportunity to embark on a big spending

If you have a project you want to embark upon or a big spending you have had in mind to do for years then you need to consider thrift contribution.

It would be of benefit to you because it  eases the pressure on your finances which means you don't have to spend all your income on a project all at once.

ALSO READ: <a href="" id="124c3403-4404-5134-a71a-431757b5a179">Financial blunders married couples must look out for</a>

Maybe you want to get a land or <a href="http://www.pulse.ng/lifestyle/money/questions-you-need-to-ask-before-buying-a-used-automobile-id7884647.html" id="67bf7a55-9c8e-5c45-bc09-2dce51b7060f">buy a car</a>, it affords you the opportunity to get the money all at once instead of putting some amount of money into your savings account, which most times you dip into, making it difficult to reach your financial goals.

4. You don’t have to pay any charges

Unlike savings where the bank has to remove some charges on your money, with a thrift contribution, there are no charges involved with it.

You get your money complete and intact.

5. It can be used as capital for a startup or a big investment

The good thing about getting your money in bulk is that you get it all at once and you can use it to <a href="http://www.pulse.ng/lifestyle/money/3-major-resources-you-need-to-start-a-business-id7845899.html" id="4040ade5-6ac6-5dab-a414-a07a0320527c">start up a business</a> or invest it into a legitimate and profitable investment venture.

Ajo- benefits of contributory thrift saving scheme

Pulse Picks

Business

News

Entertainment

Lifestyle

Politics

Local

Metro

World

News 

Celebrities

Music

Movies

Fashion

Beauty & Health

Relationships & Weddings

Food & Travel

Domestic

International 

Sports 

Celebrity Picks

Pulse Marketing

Explore categories

Influencer Awards

Company Pages

Breaking News & Top Stories | Pulse Nigeria

Video

Checkout our authors for the latest content across entertainment, sports, business and more. Be first to receive exclusive updates with your free subscription straight to your phone | Pulse Nigeria 

Authors | Pulse Nigeria

| Pulse Nigeria

Read the latest news across entertainment, sports, business and more. Be first to receive exclusive updates with your free subscription straight to your phone | Pulse Nigeria

Search for the latest content across entertainment, sports, business and more. Be first to receive exclusive updates with your free subscription straight to your phone | Pulse Nigeria

Search Results | Pulse Nigeria

Watch the latest videos across entertainment, sports, business and more. Be first to receive exclusive updates with your free subscription straight to your phone | Pulse Nigeria