Sounds exciting, right?
But let me walk you through a strategy that most people fear exploring.
Not because it’s dangerous.
But because it’s unfamiliar.
Borrowing money to invest in a financial asset.
You have probably taken SACCO loans before:
To buy unproductive land in the middle of nowhere—land you have never even set foot on.
To fund weddings, cars, college or holidays.
But when it comes to taking a calculated risk and investing in high-return financial assets…
That is where many people draw the line.
Today, let us settle this once and for all.
Can you take a Ksh 1 million SACCO loan and invest it in a financial asset like the Arvocap Asset Managers Almasi Fund, with a 19% gross return?
The Bold Move
Imagine this:
You borrow Ksh 1 million from your SACCO at 12% interest, repayable over 3 years.
You then invest the entire amount in the Almasi Fund.
Here is how it plays out.
Step 1: Borrowing Ksh 1 Million From Your SACCO
Loan Amount: Ksh 1,000,000
Monthly Repayment: Ksh 33,214
Total Interest Paid (3 Years): Ksh 195,718
Processing Fee: Ksh 10,000
Total Loan Cost: Ksh 205,718
But wait—your SACCO does not just take.
SACCO RETURNS
Assume you have:
Ksh 500,000 in deposits
Ksh 30,000 in share capital
Assuming a 15% dividend on share capital and a 10% rebate on deposits:
Dividends:
Ksh 4,275 per year on Ksh 30,000 share capital (net of 5% withholding tax)
Total over 3 years: Ksh 12,825
Rebates:
Ksh 47,500 per year on Ksh 500,000 deposits (net of 5% withholding tax)
Total over 3 years: Ksh 142,500
Total SACCO Returns Over 3 Years:
Ksh 12,825 + Ksh 142,500 = Ksh 155,325
This effectively reduces your borrowing cost.
True Borrowing Cost:
Ksh 205,718 − Ksh 155,325 = Ksh 50,393
Step 2: Investing in the Arvocap Almasi Fund
Assuming a constant 19% annual return:
Your Ksh 1 million grows to approximately Ksh 1,566,959 after 3 years.
Total Investment Gain: Ksh 566,959
Less the effective borrowing cost of Ksh 50,393
Net Profit: Ksh 516,580
That is over Ksh 516,580 potentially generated from borrowed money in just 3 years.
And here is the kicker..
Even after repaying the loan, you still own an asset worth approximately Ksh 1.56 million,
Which can continue compounding and generating income for years to come.
This strategy, while unconventional, can make financial sense—
provided the investment consistently outperforms the cost of borrowing.
NOTE:
Returns are not guaranteed and can fluctuate significantly over time.
Never invest borrowed money without fully understanding the risks involved.
So,
Would you take a SACCO loan to invest in an opportunity like this?
Alex Mwangi | The Cent Warrior | WhatsApp 0703472299
