An associative tontine is a collective savings system within a group or a
association, in which members contribute regularly to a common fund and can
receive a share of it according to pre-established rules. Create an associative tontine
requires a clear, responsible and well-structured approach.
Here are some steps to set up an associative tontine:
1. Define the objectives and rules.
First of all, you must set a very specific objective for the tontine (financial aid between
members, financing of a specific project, etc.). Then define the profile of the people who can participate, set the amount that each member will have to contribute regularly and indicate the total duration of the tontine (for example, one year, two years, etc.).
2. Create a legal framework
Make sure that the tontine complies with the legislation in force in your country, particularly with regard to fund management, security and non-speculation.
It is important to specify the rights and obligations of the members within the framework of the tontine. Finally, draw up a contract or agreement that clearly explains the rules for the operation of the tontine, with the agreement of each member.
3. Set the conditions for distributing funds
Define how the funds will be distributed among the members. This can be by drawing lots,
based on specific needs, or according to another system previously decided in the presence of
all members. As regards the management of funds, monitoring of contributions and payments, you will need to appoint one or more managers capable of managing with total transparency and according to the established rules.
4. Take risks into account
Consider purchasing insurance to protect the funds collected. In the event of a conflict, prepare mediation solutions in case of conflicts between participants, such as arbitration or a dispute resolution procedure.
5. Launch the tontine
Announce the establishment of the tontine to the members of the association, explaining the rules, operation and objectives. Once all participants are registered and have accepted the rules, launch the collection of contributions and begin managing the funds according to the established plan.
In short, the associative tontine is a great initiative to promote solidarity and mutual aid within a group. It is based on mutual trust between members and transparent management of funds. However, it requires good organization, a solid legal framework and transparent management to avoid risks and ensure its proper functioning.
Book on tontine to read: https://amzn.to/3BEmJ0n
Blog written by Caleb. A