• Rent or Buy, Homeownership is About Security

• The Burden of Societal Demands

• Financing Options for Homeownership

• The Dream vs. The Data

• The Mortgage Option for Homebuyers

• The Freedom We Overlook

• The Tradeoffs

• Buy or Rent? The Answer & A Reality Check

Rent or Buy, a highly cherished hallmark of “adulting” deeply entrenched in the Kenyan psyche alongside the reveries of becoming an overnight “mpango wa biashara” (business magnate) is the dream of homeownership.

Imagine with me, then, that you arrive at a crossroads, with one sign pointing you towards “Buy Your Own Home” while the other points to “Keep Renting.”

Behind the first sign lies a house, gleaming like a trophy, but surrounded by a mountain of hurdles and paperwork, a towering mortgage officer, and whispers of “fluctuating interest rates.”

Behind the second sign, there’s a cosy apartment, complete with a landlord whose WhatsApp profile picture hasn’t been updated in ages.

So, which path do you take?

Rent or Buy, Homeownership is About Security.

At its core, the dream of homeownership is about security.

It’s the longing for a place where you’re safe from landlords, skyrocketing rents, and that dreaded “Notice to Vacate” letter that always seems to arrive just after payday.

A home is the anchor in a chaotic world—a symbol of stability when everything else feels uncertain.

Let’s also be real—buying a home is also about status and is the ultimate flex.

Everywhere. It’s like saying, “Look, I’ve arrived.

And guess what? I’ve got a parking spot!”

There’s an undeniable thrill in casually dropping, “Yeah, I’m looking at property in Kilimani” into a conversation, even if all you’ve done is bookmark the listing.

Then there is the Burden of Societal Demands.

Society validates us when we appear not just to be merely getting on but thriving, and nothing screams “thriving” louder than the keys to a place you call your own.

A home satisfies our primal need for security and status.

Owning property means no more arguing with landlords over leaking roofs or trying to disguise your dog-that-isnt-actually-not-allowed as a “small relative.”

It’s why, despite the laughable mortgage rates and the cost of a 2-bedroom feeling more like a phone number than a price tag, we keep chasing the dream.

Because homeownership is not just a goal. It’s a statement.

Suddenly, when you own a home, you’re magically “more acceptable”. It isn’t something openly discussed out there, but you certainly become the envy of many.

But, before we romanticise the idea of homeownership as being as idyllic as waking up to birds chirping on a serene morning beside a placid brook on a bright, sunshiny morning, the hard realities of the “buy or rent” decisions deserve some unpacking beyond whatever emotions either decision elicits.

Rent or Buy: Financing Options for Homeownership

At the heart of the journey to homeownership lies a simple truth: the acquisition of every home involves financing in one way or another and the opportunity cost that comes with it.

Whether you’re saving diligently to pay out of pocket or leveraging external funding like a mortgage, the path to owning a home requires a financial commitment that shapes not just your bank balance but your broader life choices.

This core reality presents individuals with two distinct options – purchase the property out-of-pocket or go the mortgage route (which offers access to immediate ownership but comes with structured debt and its associated costs).

If you choose the self-financing route, you’ll bleed whatever savings you have to enjoy the security and status that owning a home gives at the expense of something else – maybe that holiday, additional income from investments you may have had to liquidate, that side hustle you could have set up to increase your income, the opportunity to advance your education and career. Something.

On the other hand, if you borrow to finance homeownership, you will have to contend with the realities of financing.

If you’re in that small but privileged club of workers who can access a mortgage, you have the opportunity to own a home outright, eventually. It is a long-term investment in your future and your legacy – a full-on, committed, long-term relationship with your bank.

You’re locked in, your monthly “dates” are expensive, and there’s no ghosting allowed.

Repayments will have you in a chokehold, feeling like a lifetime gym membership you forgot you signed up for.

Plus, now you own it.

If it breaks, it’s all on you! Let’s not forget the maintenance. Owning a home means you are now the “landlord.” Leaking reef? Your problem. Fence fell over during a storm? Also, your problem.

To acquire that home, you are trading off that time and labour for security and status.

Both options come with their unique set of challenges, demand discipline, patience, and often years of sacrifice.

Homeownership: The Dream vs. The Data

In 2023, statistics from the Central Bank of Kenya’s Bank Supervision Report of 2023 revealed that the average mortgage loan size in Kenya in the year 2023 was 9.4 million, while the average interest rate was 14.3 per cent (with a range from 8.7 per cent to 18.6 per cent).

The average loan maturity for a mortgage in 2023 was 11.7 years (with the shortest loan being 5 years and the longest 18 years).

Let’s say you’re one of the lucky few who could theoretically secure a KES 5 million mortgage for a cosy 2-bedroom apartment in Syokimau. Given the 2023 statistics, your monthly repayment would be on the lowest end, 56,879 shillings and possibly as high as 87,608 shillings (with the average monthly repayment being 63,648 shillings).

To comfortably afford this without violating the golden debt-to-income rule of 30%, you’d need to bring home between 189,597 shillings and 292,030 shillings per month (an average of 212,160 shillings).

Many Kenyan banks demand a debt-to-income ratio of 35% to 40% on mortgage loans, which may then reduce your income requirement. But not significantly.

Here’s where the reality bites. Per the Kenya National Bureau of Statistics, fewer than 12% of the Kenyan workforce earned above 100,000 shillings per month in the year 2022.

So, unless you’re hobnobbing in a C-Suite job or have a thriving business, this “dream” is a little more elusive than spotting a leopard in Nairobi National Park.

This indicates that very few employed individuals can access a mortgage of even 5 million shillings.

Rent or Buy: The Mortgage Option for Homebuyers

If you had the opportunity to access mortgage financing, would you take it?

Would you embrace the chance to own a home sooner, even if it meant committing to decades of structured repayments?

Or would the idea of carrying long-term debt weigh too heavily against your vision of financial freedom?

As one of the few who qualify for mortgage financing in Kenya, your decision isn’t just about affordability—it’s about how you perceive risk, reward, and opportunity in your financial journey.

Do you see a mortgage as an enabler of your dream, allowing you to invest in a place to call home while leveraging other resources for growth?

Or does it feel like a gamble, where the stakes—interest rates, fluctuating incomes, and market uncertainties-loom larger than the potential gains?

In a market where only a minority can even consider a mortgage as an option, the question is: What would this choice mean for you, your aspirations, and your long-term financial goals?

In Kenya, where the mortgage market remains relatively unknown, it’s easy to overlook this financing option.

Yes, mortgages are not without their challenges—risk assessments by banks alone weed out more than 90% of the workforce, limiting access, and high interest rates can make even the notion of repayments a nightmare in an economy mired with uncertainty.

Yet, for those who qualify and approach it judiciously, a mortgage can be a viable pathway to homeownership. It can enable the much-desired security and status of homeownership, spreading the financial weight over time.

By understanding these dynamics, you can make informed choices about how to turn the dream of homeownership into a reality that fits your unique financial journey.

Realistically, on the numbers alone, homeownership, going the mortgage route, feels more like an exclusive “members-only” club than a possibility for the majority who are simply not on that “guest list”.

Rent vs. Buy: The Freedom We Overlook

Renting often gets a bad rap.

It’s framed as “throwing money away,” a sentiment parroted in many family gatherings where the subtext is clear: You’re not truly successful until you own a home.

Renting is often seen as the ultimate betrayal of adulthood. Family gatherings probably sound like:

“Still renting, eh? You know that’s just dead money, right? Real adults buy homes!”

Renting is like dating; it gives you the thrill of commitment without the permanence of marriage.

Buying, however, is tying the knot with your bank.

Sure, you’ll get the house, but you’ll also inherit its debts, drama, and an immutable “for better or worse, till death do us part” clause.

As a renter, you’re a nomad, able to pack up and leave at the end of notice, no strings attached. 

Scorn it, but renting can be the ultimate flex of freedom. Think about this –

• Want to move cities? Pack your bags.
• Found a better deal? Say goodbye to your landlord.
• Economy crashing? No 14.3% interest rates to lose sleep over.
• Don’t like the neighbourhood? Find the one you prefer and move there.

But this freedom comes with its quirks: landlords who think 1980s plumbing is “vintage,” annual rent increases that feel like ransom notes, and the knowledge that every shilling you pay is building their equity, not yours.

And of course, every rent payment feels a little like buying a pizza for your landlord—great for them, but you’re left holding an empty box at the end.

Rent or Buy: The Tradeoffs

Each decision has its trade-offs.

Saving up to buy a home or taking out a mortgage to do the same outright will either have an opportunity cost or straddle your life with the weight of long-term debt.

Renting, on the other hand, often means delaying the benefits of homeownership, potentially forgoing opportunities that arise in a volatile property market.

Rent or Buy: The Answer

So, what’s the answer? Should you buy or rent?

Well, that all depends. On you! Your financial situation, your goals, your lifestyle, and yes, your risk tolerance.

Let nobody tell you that there is a “one-size-fits-all solution”—your decision to buy or rent is just a balancing act between risks, opportunity costs, and personal circumstances.

Neither choice is inherently superior. They’re just different paths to shelter.

Reality Check: Context is King

I’d like to offer you a reality check.

While buying might be a worthwhile goal, it shouldn’t come at the expense of financial sanity.

Kenya’s housing market is not the panacea of passive income as some would have you believe, nor is renting a sentence to financial mediocrity.

Understanding your financial bandwidth and making a decision that keeps you empowered rather than enslaved is the way to go.

There is no shame in renting if it means staying sane, and no glory in buying if it leaves you broke. After all, a home is ultimately where your peace resides, not where your stress compounds.

Want stability? Have generational wealth? Buy.

Need flexibility? Don’t want to be tethered to an interest rate? Rent.

The notion that you can make successful, personal decisions on the back of, “but so and so did such and such, or so and so is like such and such and so I have to do this and the other to give off the impression that I am this or that” will be your undoing.

At the end of the day, the best decision is the one that aligns with your goals and makes you feel at peace.

Whether you choose to own or rent, the key is to remember that the house doesn’t make the home. You do.

So, take the plunge and take out a mortgage. Or, renew that lease. But do it on your terms.

Do what works for you!

Secure Your Land Investment:

“Hi there! My name is Wanjiku and I presently live in the US. Some 9 years ago, I bought a plot of land in Kenya which I have never actually seen. In the time since I purchased it, I have also never been back to Kenya. The relative who helped me, by going to see the property when I was buying it, has since passed away.

Besides knowing that it is located in Nanyuki, I couldn’t tell you much else. I should mention that I bought the land from a land-selling company that has apparently gone out of operation!  As proof of ownership though, they did send me an original title deed which is in the custody of my father.

This coming December, I plan to visit Kenya and I plan to go see the property. I have some concerns and I’d like your advice. Because the original seller has since shut down and I would hate to walk into any nasty surprises, between now and the time of my visit, what would you recommend I do to ensure that my investment is safe?
Thanks so much!”

Hello Wanjiku! Thanks for reaching out. Your question highlights a common concern for Kenyans in the diaspora, especially those who invest in land back home without always having the full picture on the ground.

There are indeed several steps you can take to protect your interests and make sure that your property is secure. Hopefully, these measures will give you a clear game plan before and during your December visit!

#1. Start with a Title Search

Authenticate your ownership of the plot by undertaking a title search. This should be your first step. The search will confirm if the title deed you have is genuine and if you’re officially registered as the owner. It may also potentially reveal any irregularities between what you know and what is officially recognized. This may include existing encumbrances or third-party claims, which may be registered against the property. Application for searches requires a full copy of the title deed as well as an identifying document of the applicant for the search.

• Why It’s Important: A title search verifies your ownership and alerts you to any surprises, such as unauthorized transactions or additional rights registered by other parties.
• How to Do It: You can work with a licensed advocate or property agent in Kenya to carry out this search. They’ll ensure that all is in order and report back with the official findings, which should give you peace of mind about what’s officially on record. This is a service we can provide you.

Although a one-time title search is a good start, consider arranging regular searches to monitor your property’s status periodically. These regular searches will help you keep tabs on any changes, like unauthorized transactions or updated registrations, that could impact your ownership. Routine searches help you stay informed of any new activity on the title. This is particularly useful if you’re abroad and unable to regularly monitor the property yourself. Your advocate can perform these checks on your behalf and report any issues to you promptly. This way, you remain updated even while overseas.

#2. Buy the Registry Index Maps

Once you have ascertained that the title deed to the property is authentic, the property is duly registered to you and that there are no “impeding” concerns, don’t rest on your laurels at that. Send for the registry maps. This will ensure that the property is identifiable on the ground relative to other properties within its vicinity. It isn’t enough to know that property exists. Where it is is just as important if not more.

• Why It’s Important: Maps will indicate boundaries, adjacent properties, identify easements and reserves and much more – mitigating the possible complications that could potentially arise from the property’s misidentification for example encroachments, boundary disputes and even improper use of the property.
• How to Do It: Maps are usually available at the land registries survey offices. Being out of the country, I suggest you work with a licensed surveyor or property agent in Kenya to purchase registry maps. This is also a service we can provide you.

#3. Perform a Survey and Physical Inspection

You mentioned that you’re unfamiliar with the exact location and neighborhood. A physical inspection is essential, and you’ll want to arrange a survey with a licensed surveyor before your December visit. The surveyor will identify the boundaries, confirm whether the land exists as documented, and note any encroachments or discrepancies in size.

• • Why It’s Important: This step ensures that the property exists where it should be, without any issues such as encroachment from neighboring plots. You’ll also get a clearer idea of the area’s accessibility, amenities, and any potential development opportunities.
  • How to Do It: You can hire a licensed surveyor to map the land and mark the boundaries before you arrive, giving you a visual and legal assurance of your plot’s exact dimensions and location.

#4. Consider a Site Visit for Boundary Fencing and Security

When you arrive in December, plan to visit the land and assess its security needs. A properly fenced property is less prone to trespassing or encroachment, which can be issues in under-monitored areas. While on-site, take stock of the local security conditions and decide if additional security measures, such as boundary markers or fencing, are necessary.

• Why It’s Important: Fencing serves as a physical deterrent and a clear boundary marker, helping you avoid potential land disputes. 
• How to Do It: Once you’ve surveyed the land and verified boundaries, you can consider fencing options that suit the neighborhood’s environment and your budget. This is something a local property manager can also help maintain if you’ll be back in the US for extended periods.

If there has been any interference with your property or potential threats that may warrant “extraordinary” m easures, then you might want to consider putting up signage on the property to deter tresspassers.

I’d also encourage you to consider some basic improvements to the property that can add value to it and which won’t set you out of pocket too much. For example, green fencing (hedges), properly demarcated pathways on the property using basic materials like cobblestones are a good addition. Regularly clearing out any bushes and overgrowth, pruning trees on the property will give the property an allure and make it stand out. 

These are some of the more basic measures you could undertake. But if you are spirited and want some more aggressive measures, then I would also propose the following:

#5.  Place a Caveat on the Property

This may seem somewhat extreme, however, given the time you’ve been away and the fact that you’re uncertain about the property’s status, consider placing a self-imposed caveat on the title. By doing this, you essentially alert the Land Registry that no dealings can occur on your property without your explicit consent. This would be particularly applicable where there has been an attempt to intefere with your rights as the property owner.

• Why It’s Important: A caveat is a powerful measure to prevent unauthorized transfers, sales, or mortgages on your land, especially if someone were to try to use your absence to their advantage.
• How to Do It: You or your advocate can file this caveat at the Land Registry. Once in place, it adds an extra layer of security by limiting the potential for unauthorized dealings.

#6. Vigilance is Everything: Changes in Land Regulations and Zoning

Kenya’s land laws are ever-evolving, and keeping yourself informed on current regulations will keep you ahead of any changes that might impact your property rights or usage. In December 2023, for example, Parliament proposed legislative measures through the Land Laws (Amendment) (No.2) Bill, 2023 which would have introduced rent and rates on Freehold Land. In January 2023, through the Finance Act, 2022 in another example, Parliament passed amendments to raise Capital Gains Tax from 5% to 15%.

These changes to land regulations ultimately affect every land owner. Staying updated also ensures that you’re ready to make any required adjustments if regulations shift in ways that affect your land ownership.

• Why It’s Important: Awareness of new land policies or regulations means you can quickly adjust your plans or documentation if necessary.
• How to Do It: Set a schedule to connect with your advocate or a trusted property consultant for updates or advisories on Kenyan land laws, particularly as they pertain to ownership rights and responsibilities.

In addition, property regulations often include zoning restrictions that govern how land can be used, as well as environmental concerns that might impact development plans. Conducting an environmental and zoning check ensures you’re aware of any limitations on the land’s use, which could affect your future plans.

• Why It’s Important: Knowing the local zoning laws and environmental risks allows you to plan realistically, particularly if you envision future development or sale, and more so in areas that are rapidly urbanizing due to population growth.
• How to Do It: Your property advocate can help with these checks, ensuring you’re aware of any zoning or environmental issues that may require your attention or awareness.

#7. Put Your Land to Work

It should be obvious when you visit that leaving the land idle may inevitably create problems for you into the future. Also, it’s a misnomer to call it an investment if it isn’t putting any money in your pocket, yet demanding additional resources in time and money to manage and secure.

I’d encourage, if you can muster the time, to try and understand the area where your plot is situated. You may then be able to find viable land uses and to target opportunities that may be readily available based on market needs. You may even be abe to identify potential improvements that can help generate and even improve returns on your investment.

Conclusion

Wanjiku, purchasing land sight unseen is a brave move, but with a few critical steps, you can ensure it’s a wise one, too! Start by verifying ownership and putting protective measures in place. Then, organize a physical inspection, boundary survey, and title search before visiting Kenya. Regular checks and staying informed about local land regulations will also keep you confident in your investment.

With the right preparations, you’ll be able to visit this December knowing that your property is secure and well-managed. And when you finally set foot on it, you’ll have the satisfaction of knowing it’s truly yours, with the safeguards in place to protect it down the road. Safe travels, and all the best with your investment!

Your Chama, like many others in Kenya and across Africa, is a vital part of the financial landscape. Chamas offer a way for people to save money, access credit, and invest in opportunities often out of reach for individuals. Typically made up of friends, family, or colleagues, these groups pool resources to invest collectively, promoting financial inclusion and empowerment.

While Chamas have helped many achieve financial goals, there’s a growing awareness of the limitations and risks of this model. Investment goals are deeply personal. The challenge of promoting selfless thinking in a group often undermines the success of Chamas.

There are, however, notable success stories. Some Chamas have grown beyond their founders’ visions and gained national recognition. Centum, for instance, is now a publicly traded investment company that began as an investment club in 1967. TransCentury is another success, starting in 1997 with a group of friends who pooled resources to invest in infrastructure and energy projects across Africa.

The saying goes, “If you want to go far, go with others.” But it doesn’t mention the importance of choosing the right companions. Your journey shouldn’t be shared with just anyone. Even a family member can be the wrong choice for a fellow traveler.

Given the risks Chama members face, how can they reduce their individual risks when investing in real estate through their groups?

There may not be foolproof rules, but here are some steps they can take:

Your Chama and Due Diligence

Real estate investments are illiquid, high-stakes investments, and the importance of thorough due diligence cannot be overstated. Your Chama should ensure that the property is thoroughly vetted before committing to any real estate investments. This includes assessing the property’s legal status, verifying ownership, checking for any encumbrances, and understanding the local market conditions. Engaging a reputable lawyer and real estate expert can help avoid costly mistakes.

Align on Investment Strategy

Real estate investments can vary widely—from buying and holding residential properties to developing commercial real estate. Your Chama members should align on the specific real estate investment strategy. Whether the goal is long-term appreciation, rental income, or quick flips, everyone needs to agree on the approach to avoid conflicts down the road. Not the silent head nods, rather, an active engagement and commitment to the strategy.

Your Chama Must Establish Clear Ownership and Exit Strategies

When investing in real estate as a group, it’s essential to establish clear ownership structures and exit strategies. Your Chama members should decide in advance how ownership will be divided, how profits will be shared, and what the process will be if a member wants to exit the Chama or liquidate their share. This prevents disputes and ensures that everyone knows their rights and obligations. Adopt strategies that allow for exiting members to transition away as seamlessly as possible.

Consideration of Financing Options

Real estate often requires significant capital, and Chamas may consider financing options such as loans or mortgages. It’s important to carefully evaluate the terms of any financing, including interest rates, repayment schedules, and the impact on the group’s cash flow. Avoid over-leveraging the group, as this can increase risk and strain the Chama’s finances if the property does not generate expected returns.

Your Chama Should Consider Diversification

While real estate can be a lucrative investment, it’s also important not to put all your eggs in one basket. If your Chama holds its entire portfolio in a single property or a specific type of real estate, it becomes vulnerable to market downturns or other unforeseen challenges. Consider diversifying within real estate (e.g., residential, commercial, land, income-generating and capital gains properties) or balancing real estate investments with other asset classes, especially those that are more easily convertible to cash.

Your Chama Must Set Realistic Expectations

Real estate investments typically take time to mature, and returns may not be immediate. Chama members need to set realistic expectations about timelines, potential returns, and the risks involved. Ensure everyone understands that real estate is often a long-term investment and that patience may be required before seeing significant gains.

Prioritize Regular Communication and Updates

Given the significant financial commitments involved in real estate, it’s crucial to maintain regular communication among Chama members. Provide frequent updates on the status of the investment, any challenges or delays, and financial performance. This transparency helps to build trust and ensures that everyone remains informed and engaged in the investment process.

Plan for Property Management

Once a real estate investment is made, managing the property becomes an ongoing responsibility. Whether it’s finding tenants, handling maintenance, or dealing with legal issues, property management can be time-consuming and complex. Decide in advance who will be responsible for property management tasks or consider hiring a professional property management company if the Chama lacks the expertise or time to handle it effectively.

Understand the Legal and Tax Implications

Real estate investments come with specific legal and tax obligations. Your Chama should be aware of the tax implications of buying, holding, and selling property, including zoning, applicable property taxes, capital gains taxes on disposal, and any applicable fees. Consulting with a tax advisor or accountant can help the group navigate these complexities and avoid any legal or financial pitfalls.

Your Chama Must Have a Contingency Plan

Real estate investments can be unpredictable, with potential issues ranging from market downturns to unexpected repairs or vacancies. The Chama needs to have a contingency plan in place, including a financial reserve to cover unexpected costs. Planning for worst-case scenarios can help the group weather challenges without resorting to panic decisions that could harm the investment.

Conclusion

These measures are tailored to the specific challenges and opportunities of real estate investing, helping to ensure that Chama members approach such investments with a clear, strategic mindset. Members of Chamas should consider them as having applicability to the Chama broadly, but also to themselves specifically so that they take “joint and several” ownership for their investments. They won’t preclude the many pitfalls that Chamas face in building the “collective”. But they will guide the mindset that members ought to apply in their collaborative efforts.

Inevitably, the success of Chamas investing in real estate will be determined by how best they will navigate their internal group dynamics, and by factors not entirely within the control or responsibility of any of the members individually.

Chamas are small informal savings groups or investment clubs in which members typically pool financial resources together, contributing a fixed amount regularly, and then either taking turns borrowing from the collective fund, investing it in various ventures, or distributing it among the members on a rotating basis.

If you are in a savings and investment Chama, I want to suggest to you that your Chama may be nothing but deadweight dragging you down and you may need to cut your losses and run!

Yes, I said what I said: your Chama may also be the crutch you lean on to avoid facing a hard truth—that you need to take control of your own financial destiny.

Let me make an even bolder statement.

If you don’t have well-established financial goals outside of that your Chama, then you’re building your “house” on sand. Herding and collectivist ideas are great. Until they are not!

I might have pooped on your parade but before you go getting all hot and bothered, let me explain exactly why this your so-called ‘collective investment’ may holding you back.

Chamas: A Simple Assignment for You

Take a good, hard look at five members of that your Chama—the ones you think you know best. Now, ask yourself, and be brutally honest:

• Who do you share the same financial goals and strategies for building wealth?
• Have any of them ever laid bare their financial plans to you? Do you even know their financial philosophy?
• Apart from chasing money, do you share any values, ideology, or identity with them?
• Are you all at the same stage in life?
• Are your life priorities—like marriage, kids, and family—more similar than they are different or vice versa?
• How wide is the age gap between you?
• Are your lifestyles aligned, or are they worlds apart?
• Are you even close in terms of income and financial standing?

Now, stare at those answers, call yourself to a meeting, and ask: Why on earth is this the crowd I’ve chosen to run with?

Let’s be real—if you don’t know these things about those five Chama members, and if at least those five members don’t know these things about you, then how on earth would they ever be solid financial teammates, let alone partner with you to build real wealth?

But Chamas are the Embodiment of Unity?

I am not in any way saying that you cannot achieve a lot in an organized group of people. Speaking to unity, the Good Book, in Ecclesiastes Chapter 4 (Verse 9 to 12) says: Two are better off than one because there is a greater reward for their labour…If it is cold, two can sleep together and stay warm, but how can you keep warm by yourself? …. A rope made of three cords is hard to break.

I am saying, however, that the same Good Book asks, in Amos 3:3 “Can two walk together, unless they have agreed to meet?” The same good book goes on to warn in 2 Corinthians 6:14 “…. For what do righteousness and wickedness have in common? Or what fellowship can light have with darkness?”

Simply put, two distinctly different ways of thinking will always oppose each other.

Perhaps some context from a personal experience I had a little more than a decade ago with a Chama I was part of will shed some light.

Hope and Optimism

At the outset, there was hope and optimism and a feeling that we were destined for greatness. We were a disparate group of 30-odd persons – a mix of employed professionals and self-employed individuals and entrepreneurs, male and female in the ratio of about 5 to 1 and all roughly between the ages of 32 and 43, (a variance of about a decade). All of course very eager to build wealth together.

The dream was simple: pool our resources, make savvy investments and watch our fortunes grow. But as they say, the road to hell is paved with good intentions.

The Illusion of Unity

In theory, Chamas are the embodiment of unity. But unity can be an illusion. In our Chama, the self-employed individuals carried the team on the execution of tasks. You might say that they kept the engine running. The employed group, on the other hand, having a consistent income, tended to be more consistent about making their contributions, indeed contributing most of the funds. They supplied the fuel that was supposed to drive us forward. And for a while, there seemed to be some balance.

Here’s the thing about balance—it’s delicate. It doesn’t take much to tip the scales. And in our case, the scale tipped due to power and participation imbalances. Decisions were often arrived at in silos occupied by the elite contributors, then served on the rest for “consensus”. This precluded the financial goals of those who were not calling the shots, instead aligning the Chama to the goals of those who were. Those who invariably felt excluded and voiceless were the individuals who were then often charged with routine, mundane functions. This killed morale and eventually led to divisions within the Chama.

Chamas and the Trap of Groupthink

If you have been in a room where everyone nods in agreement, either out of emotion or maybe a lack of understanding, even when their instincts may be telling them something isn’t right – that’s what groupthink looks like. And it’s a silent killer.

Groupthink breeds where people either lack their original ideas, believe others have better ideas than their own and are unwilling or not disciplined enough to do what it takes, personally, to work on their own goals.

In our Chama, there was little, if any, thoughtful analysis – just head nods in echo chambers where confirmation bias began to take over, depending on who was advocating for any particular choice. The louder voices—those with the most financial weight—pushed their personal preferences, convinced they were on the path to success. And the rest? Feeling voiceless, they began to just go along for the ride. Inevitably, disaster was just around the corner.

The Price of Silence

You know that saying, “The squeaky wheel gets the grease?” Well, in our Chama, the squeaky wheels were silenced, and the silent majority just coasted along. They participated peripherally, contributing funds without ever questioning how those funds were being used. It’s easy to stay quiet when things seem to be going well, but silence has a cost.

When the big decisions came—those heavy, capital-intensive investments—the silent ones remained just that: silent. And so, we charged forward, led by the few who believed in their own invincibility, their financial contributions blinding them to the risks. The result? Catastrophic financial losses. The kind that leave you questioning every decision, every moment of silence, every missed opportunity to speak up.

The Folly of Collective Dreams

Now, don’t get me wrong—there’s power in collective effort. But here’s the truth that no one likes to admit: Collective dreams can quickly turn into collective nightmares. Especially when those dreams are built on the shaky foundation of misaligned goals.

In our Chama, we started with a shared dream. But dreams are funny things—they can change shape, morph into something unrecognizable. As time went on, it became clear that our individual goals were pulling us in different directions. One group wanted growth, innovation, and smart risks. The other, wanted security, steady returns, something to show for their hard-earned money even in the short term. And so, the dream began to split at the seams.

Chamas and The Place for Expressing Individuality

The thing we try to suppress in collectivist ideas like Chamas is our individuality. Acknowledging our individual goals from the start, if we had embraced them rather than forcing them into the mould of collective thinking, we might have found a way to make it work.

But unity isn’t strength when it’s forced. Unity that recognizes individual goals, and allows for diversity of thought and approach was required. True success doesn’t come by attempting to substitute your individual vision with a collective vision. Rather, it comes from finding a way to align those dreams, let each voice be heard, and make decisions that reflect the wisdom of the whole, not just a few.

The Lesson: Don’t Lose Yourself in the Crowd

So, here’s my caution: If you’re considering joining savings and investments Chamas, or any collective investment group, first develop and prioritize your own financial goals. Yes, there may be strength in numbers, but there’s also wisdom in individuality. Be clear about what you want, be willing to speak up, and don’t be afraid to go against the grain.

Remember, it’s your future on the line. And while it’s great to have a team by your side, make sure that team respects your journey as much as you respect theirs. Because at the end of the day, the road to wealth is a personal one, and no one can walk it for you—not even your Chamas.

PostScript: Relevant to real estate, 11 years after the Chama collapsed, we still collectively hold a piece of land that has sat idly for that time. The “dominant” voices in the Chama are waiting for greater “capital gains” adamantly holding out that selling at this point would be regrettable. We are now stuck together doing nothing!