Reaping benefits is one of the main aspects of chit funds. Chit funds enable their members to earn monthly dividends on their investment and receive the full chit amount at the end of the scheme. The rate of return is also significantly higher than what a bank would offer.

To reap benefits from a chit fund, one has to continue paying the monthly instalments and collect the dividend every month. The dividend is the amount that is distributed among the non-winning members after deducting the organizer’s commission and other charges. The dividend varies depending on the discount offered by the winning bidder, which may change from month to month. The last bidder gets the prize money without any discount, which is equal to the chit amount.

The benefits reaped from a chit fund can be utilized for various purposes, such as:

Saving for the future: Chit funds can help to save for future goals, such as buying a car, a house, or a vacation. Chit funds can also help to plan for retirement.

Investing in various assets: Chit funds can help to invest in various assets, such as gold, property, or stocks. Chit funds can also help to diversify the portfolio and reduce the risk.

Earning passive income: Chit funds can help to earn passive income from the monthly dividends. Chit funds can also help to beat inflation and taxes and increase the purchasing power.