Especially in a time when it feels like new financial obligations pop up pretty much constantly, making the most of your pounds is incredibly important. An innovative approach and increasingly popular nowadays is the money pot, a means for family members and loved ones to share their resources among themselves, saving up collectively toward one desired end.
There are many benefits to doing it this way; from improving relationships through facilitating important money conversations, all the way up to turning high financial targets you never thought could be true into an enforceable reality. We dive into the wonderful ways a money pot can help your family, or friend group.
Building Relationships Through Common Goals
One of the most exciting aspects about making a little money pot with family and friends is that it ensures you get to promote closer relationships. The obvious idea of people pooling funds together to pursue a common objective –whether it be planning for an activity, going on group travel or even investing jointly in some enterprise.
Saving together creates social capital and commitment. Every little helps as the saying goes, but each contribution is an ode to collaboration and frequent conversation of where that pot will eventually land can be a tool for reconnection. Everyone is on the hook financially, so ideally this will bring more trust and bonds.
Faster financial success
One at a time it is slow and in some cases exhausting when the financial goal becomes humongous. Save together extremely quickly, but a pot sum is contributed by multiple persons only. This acceleration is one of the most tangible advantages in having a communal pool of savings.
If you put away £100 each month from a group of 10 friends that could be as much as it already makes to have the pot with all its members will add up to £12,000 so maybe this year. That figure is likely well above what any individual worker could have socked away on her own over the same stretch. This can help keep all driven and focused on the end goal by keeping everyone up to speed with how close or far off the target actually is.
Reducing Financial Stress
Types of stress Money is a universal form of salt today — and we often experience the most anxiety about it when attempting to save for or finance a big expenditure over time. The stress is just distributed across more people and thereby mitigated on a significant scale by having some money in the pot.
And there’s solace in numbers when you know that you are not the only one saving towards a big goal, even if it means spreading out how long each person might wait to see their dream achieved. Financial cushion — The use of a money pot can also be very useful when you need to borrow those same €100 from your aunt.
Once the group accumulates at least £1,000 in donations (£2,500 is ideal), any one member can tap into this collective well of funds to cover immediate expenses or take advantage of some educational or other opportunities that arise. The safety net provided by these features can help alleviate financial stress and contribute to greater overall security.
Take it a step beyond
Sure, when saving alone, you may be tempted to take from your savings for other expenditures. But, a money pot brings accountability, which can lead to better financial discipline. After all, there is less of a chance you will allow yourself to get lazy if others depend on your part.
Also, contributing a little bit on the front end into pooled funds can be an easy way to train yourself to save money. The skills you develop in that one area of your life can begin to leak into other areas, and even if it never goes any further than bitcoin for tax evasion purposes is still a net positive.
It gives you something visual to count on, but also serves as a routine that makes saving with others feel almost second nature, responsibility and commitment go hand in hand when it comes to great financial success.
Enabling Transparency and Communication
For the money pot to be successful, all members in it must communicate clearly and act transparently. Each person must learn the rules of entry, how much to pay for entrance and when, what is being paid for. Having a mandatory telephone conference can solve this issue and work on all member’s communication skills, so everyone is aware of what the group wants to do for its members financially.
Equally, a money pot can open up the conversation around saving and spending in the group, so members benefit from shared discussion on managing finances, budgeting or financial planning. These chats are wonderful learning opportunities, especially for people who may have relatively little experience when it comes to saving or their personal finances. Money talk: Families and friends can start procedures of financial transparency, instead of locks of taboo.
Contribute and Use with Flexibility
Money boxes are charming in that it is one of the few ways you can store money. Everyone contributes to their ability so that even those with meagre financial resources can be included. Whether a person only wants to contribute £20 or go big and deposit hundreds of pounds, Money Pot can support any level contribution.
It is also flexible in usage of the amount. Although the group may be working towards one main objective, funds can also disperse to other agreed upon uses. For example, the kettle of money will be used in emergencies and a deduction or % is counted off your same account, only now It’s buried into that higher end goal. It is this value and versatility that makes a money pot an ideal financial tool.
Create Real Success
Achieving a financial goal feels pretty darn good, especially as part of a team. The hard work together and the helping hand for all makes it an even bigger win! Then, when the money pot hits its target, making everyone involved proud of what they all achieved together.
The cohesion created by their shared accomplishment might very well linger on the dynamics of that group for quite some time. It can spur future joint pursuits, either through pounds or no. Achieving one goal gives the group confidence that it can set and hit even larger goals in the future.
Conclusion
A money pot is not just a savings method, it also helps to strengthen relationships and hit goals quicker as well, promoting financial wellness into the group. Whether it is a family holiday you are saving for, organising something as grand and celebratory as that big wedding day or even planning to invest in that million-franc business opportunity next door, pooling resources with the family & friends can make life easier. When you align your goals and begin to work together, that is when the magic starts to happen — taking financial dreams from imagination into reality while bonding with those most important in each of our lives.
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