Frequently asked questions

Hello Vicky, which bank will give me $400 per month interest on $40,000? I'll open an account immediately!!

Oops - I'm sorry - it's actually $400+ per quarter. I'm including the tax deducted because I'll get all that back at the end of the year - but still. $400 a month would be great - but my mistake.

Obviously not the same, and not as attractive.

That certainly changes things in my mind.

And thank you Pamela for spelling it out.

OK so my next question is: if I were to purchase 40K shares in CoHOP - how would that work as far as the savings plan goes - it wouldn't be in there available for people to borrow, right? Would it make more sense to split it up? And how would you decide what to do in this example?

And shares are not as accessible so that's a reason to split it I think.

Sorry about the bit of interest excitement! :-)

Vicky

So here is what I am doing at the moment.
I am saving into the CoHOP Savings Pool (because I have easy access to my money, to continue to save toward CoHOP Shares and have the option to take a loan out if I need extra than what I have in there.
Because i am committed to getting CoHOP Limited set up well and professionally I am transferring small amounts of my own money from the savings Pool into CoHOP shares to support the setup.
When we CoHOP Ltd have found and decided on a land purchase I along with those of us who desire future home ownership will then transfer the bulk of our money into CoHOP shares to begin the development and building process.
In the meantime I will continue to be a member of the Savings Pool to not only contribute to our group but to have access to no interest loans should we need some funds in the future. Also to build up a good relationship with the Savings Pool Association who may be able to grant the CoHOP member of our pool a no interest loan for the difference between what capital we can pool between ourselves and the cost of the development.

Of course the more I can build up my savings toward share contributions the less I may have to pay in weekly contributions when I move into my CoHOP home. the easier it will be to live from a cash-flow point of view.

Thanks Pamela. That sounds like a good strategy.
Vicky, to answer your question directly, I think Pamela's strategy is the best at present. As we're not actually purchasing property at the moment, there's no point having large amounts of savings in the CoHOP share account, even if it does earn a little interest. Money in the savings pool, on the other hand, is readily available should you need it at short notice, and it may be helping someone else in the meantime. When we are ready to purchase, savings in the savings pool can be quickly and easily converted into shares in CoHOP. As CoHOP is itself a member of the savings pool, it could borrow from the Savings Pool Association if necessary, so it makes sense to be building up points (dollar-months) by keeping as much money as possible in the savings pool. We transfer some money to SPA every month, and we could increase that amount as our membership and contributions grow, which would give us even more savings points with SPA.

10 posts up Barbara mused about how to communicate the advantages of CoHOP investments over conventional investments.
The next post by Pamela was great for a list of considerations of ethical investing.
I would always be really honest about it:
Ethical investing gives you less financial returns, but a lot more other returns, for yourself and for the direct community around you.
Everybody we will talk to knows that measuring progress by GDP alone is a very short-sighted thing to do. Other factors are completely overlooked. (e.g. waging war, or the production and processing of chemical waste contribute positively to GDP!)
A similar thing is happening when you only measure your gain from your investment by dollar-values, or % of return.

Also...
It would be counter-productive to try and convince someone that CoHOP investment is financially more effective than conventional investment.
Your listeners will know there is something wrong with your statements, or at least very unlikely and will stop listening.
Similar:. have you ever seen a Christian convert an atheist by making a strong case and choosing his/her words carefully? (or vice versa).
Thus it becomes a matter of 'what can you afford?'
If you can afford a conventional house with a certain level of convenience and luxury, but you have to work for the mortgage 'forever' and be unhappy in keeping up with the Joneses, and then compare it with living in a smaller unit, added to it shared facilities, etc, etc,... which may from a 'GDP-perspective' be less, ...... But from a holistic well-being perspective be more....... Ta-Da!

It was truly an interesting discussion.
(tongue in cheek:) One that showed us (8 posts up) that Sonia has her price. Offer her 3 times the normal rate of interest, and the bank can have her soul!