Sounds Exciting, right?
But let me take you through a strategy that most fear to explore
–Not because it’s dangerous, but because it’s unfamiliar.
You’ve taken SACCO loans before.
- To buy unproductive land in the middle of nowhere — land you’ve never even set foot on.
- To fund weddings, cars, or holidays.
But when it comes to taking a calculated risk to invest in High-Return Financial Asset opportunities,
That’s where you draw the line.
Today, let’s settle this once and for all.
Can you take a SACCO loan of Ksh 1 million and invest it in a financial asset like the Arvocap Almasi Fund, which returned 27.06% in its first year?
Let’s break it down
MAKING A BOLD MOVE:
Imagine this.
You borrow Ksh 1 million from your SACCO at 12% interest, payable over 3 years.
You invest that entire amount in the Arvocap Almasi Fund.
Here’s how it plays out
STEP 1: BORROWING KSH 1 MILLION FROM YOUR SACCO
- Loan: Ksh 1,000,000
- Monthly Payment: Ksh 33,214
- Total Interest (3 yrs): Ksh 195,718
- Processing Fee: Ksh 5,000
- Total Loan Cost: Ksh 200,704
But wait — your SACCO doesn’t just take.
SACCO RETURNS:
If you’ve saved Ksh 350,000 in deposits + Ksh 30,000 in share capital, you’ll earn:
Assuming a 15% dividend on your share capital and a 10% rebate (interest) on your deposits:
Dividends: Ksh 4,275 per year on Ksh 30,000 share capital (after withholding tax 5%)
Total over 3 years: Ksh 12,825
Rebates: Ksh 33,250 per year on Ksh 350,000 in deposits (after withholding tax 5%)
Total over 3 years: Ksh 99,750
Total Sacco Returns Over 3 Years: Ksh 12,825.00 + Ksh 99,750.00 = Ksh 112,575
So, your true borrowing cost drops to Ksh 88,129
STEP 2: INVESTING IN ARVOCAP ALMASI FUND
With 27% returns:
After 3 years, your Ksh 1M grows to Ksh 1,858,599
Total Gain: Ksh 858,599
Subtract your loan cost of Ksh 88,129…
Net Profit: Ksh 770,470
That’s Ksh 770K earned from borrowed money in 3 years.
And here’s the kicker…
Even after loan repayment, you now have a fund of Ksh 1.86M earning Ksh 426K/year.
THE BIG LESSON:
This strategy, while unconventional, makes financial sense
–as long as the investment continues to outperform the cost of borrowing.
NOTE:
The 27% return is not guaranteed and may fluctuate in the 3-year timeline.
Always do your risk-return due diligence before investing.
Almasi Fund is just an example.
–You can explore other opportunities like Mansa-X, Oak Fund, Kuza Momentum Fund, or the Arvocap Multi-Asset Fund, just to mention a few.
So, tell me…
Would you take a SACCO loan to invest in an opportunity like this?
Let me know your thoughts.
Alex Mwangi | Your Personal Finance Architect
Helping You Master Your Money | Build Wealth | Protect Your Legacy
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