July is National Savings Month in South Africa, making it the perfect time to take a closer look at your finances and explore smarter ways to save. For millions of South Africans, stokvels remain one of the most trusted and practical ways to build savings, manage household expenses, and prepare for unexpected costs.
According to the National Stokvel Association of South Africa, there are around 800,000 stokvels operating across the country, with combined assets of more than R50 billion. More than 11 million South Africans belong to at least one stokvel, highlighting just how important these community-based savings groups are to everyday financial planning.
But while stokvels continue to be a popular way to save money in South Africa, not every stokvel offers the same value or level of financial security, says Sarah Nicholson, Head of Customer Experience at JustMoney.
Choosing the right stokvel can make a significant difference to your financial wellbeing, especially at a time when many South African households are facing rising living costs.
JustMoney’s Money & Me Survey found that only 9% of South Africans save the recommended 10% or more of their monthly income, while 42% need to borrow money before the end of the month. Only 16% of respondents said they could cover an unexpected expense of R10,000 without relying on credit or financial assistance.
“A stokvel can help people develop good money habits and become a powerful savings tool, but only if it’s carefully chosen and fits your financial goals and monthly budget,” says Nicholson.
“It’s important to ask the right questions before committing to any stokvel.”
Nicholson shares these practical tips for choosing the best stokvel in South Africa:
- Start with your savings goal
Think about exactly what you’re saving for. It could be school fees, school uniforms, an emergency fund, December groceries, a family holiday, or preparing for unexpected expenses such as funeral costs. Your savings goal should determine the type of stokvel you join.
- Don’t join because of pressure
Many stokvels are started among friends, relatives, neighbours, or church groups. While joining people you know can be comforting, don’t feel pressured into joining simply because everyone else has. Make sure the stokvel fits your own financial situation and long-term savings plan.
- Look for good leadership and clear rules
A well-managed stokvel should have written rules or a constitution, elected leaders such as a chairperson and treasurer, accurate financial records, and regular updates to members. Transparency helps protect everyone’s money.
- Understand how your money grows
Before joining, find out how contributions are collected, where the money is kept, when payouts happen, and what happens if someone misses a payment. A good stokvel should have clear, consistent processes that everyone understands.
- Ask how disagreements are handled
No group is free from conflict. Find out how disputes are resolved and what happens if someone wants to leave the stokvel before the agreed period ends.
- Find out how new members are accepted
If anyone can join immediately without any screening or approval process, it could be a warning sign. Responsible stokvels usually have a process to ensure new members are trustworthy and committed.
- Check where the money is kept
Some stokvels still keep cash instead of using a bank account, which increases the risk of theft or fire. Ask whether the group uses a dedicated stokvel savings account or another secure banking option to protect members’ savings.
- Make sure there is a backup plan
If only one person has access to the bank account, records, or passwords, what happens if they become ill, move away, or pass away? A reliable stokvel should have shared responsibilities and proper succession planning.
- Ask about bank account benefits
Many South African banks now offer specialised stokvel accounts with added benefits such as better interest rates, funeral benefits, or lower banking fees. Check whether your stokvel is making use of these products.
- Watch out for scams
Avoid stokvels that promise unrealistic returns, rush you into joining, or refuse to answer questions about finances or record-keeping. If something sounds too good to be true, it probably is.
- Attend a meeting before joining
Instead of relying only on word of mouth, ask if you can attend a meeting as a guest. Observe how members interact, whether financial records are presented openly, and whether everyone feels comfortable asking questions.
- Ask about unexpected situations
Life doesn’t always go according to plan. Find out what happens if a member loses their job, passes away, or cannot contribute for a few months. The answer will give you valuable insight into how fair and prepared the group is.
- Don’t rely on one popular leader
If the stokvel’s success depends entirely on one well-known or charismatic organiser instead of proper systems and accountability, think carefully before joining. Strong governance is more important than personality.
- Be honest about what you can afford
Some stokvels require high monthly contributions, while many South Africans belong to more than one stokvel at the same time. Make sure your contributions fit comfortably within your household budget without affecting essential expenses like food, transport, rent, or school costs.
Ultimately, Nicholson says getting the most value from a stokvel comes down to planning, discipline, and choosing the right group for your financial needs.
“When people choose a stokvel that matches their savings goals, it remains one of South Africa’s most practical, accessible, and effective ways to build financial security. The members who benefit the most are those who ask informed questions and make sure the stokvel’s structure supports their long-term financial wellbeing.”
