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Employee's Mutual Assistance Fund

Crissy Taruc By Crissy Taruc on
Badge: Advisor | Level: 19 | Finances Expertise:
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It is indeed indispensable that we save a portion of our family's income. Part of it may spend on some emergency cases and part of it can be invested on something that will yield a good income. Given the global economic crisis, is there indeed any place where we can invest our hard earned money that will yield an interest or dividend income better than banks?

Hubby is working in a radio network industry and the company's employees put up this what they called "Mutual Assistance Fund." The objective of this "Mutual Assistance Fund" is to provide monetary help to every member. This group consists of company's regular employees and each employee will contribute their money to serve as the fund. They voted for their set of officers and they have the group acknowledged by the company. Each member may have a onetime investment and they can increase or decrease their contribution at any given month. They have their own set of rules and procedures as to contribution, loan terms and membership.

Processing and approval of loan. Each loan is supported by a duly filled up and signed application form. The amount of loan is determined by the amount of contribution the applicant/employee has in the fund. Once approved the monthly amortization will be deducted from his or her salary by the company and then the company will remit it to the group. Loan application and approval can be finished in just 2-3 days.

Interest or dividend income. As compared to banks giving just 1% per annum interest on deposits, the contributions in this fund can yield up to 15% per annum. For a 10, 000 pesos contribution hubby received 1, 429 pesos as annual dividend from this "Mutual Assistance Fund."

Fund's safety and security. The group's set of officers are responsible for the reporting of the fund's status. They are obliged to monitor the flow of the fund and to see to it that everything is in order and accounted for. The fund is not allowed to be used in any other purpose aside from loans to extend to its members.

Given the above features of this "Mutual Assistance Fund, " hubby and I are planning to increase our contribution to yield a good dividend and help other employees who are in need financially while waiting for his retirement 3 years from now.