Voluntary Withdrawal
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Voluntary Withdrawal We feel that some members are using club membership as a savings account and are withdrawing for
spurious reasons. Our bylaws say a member may withdraw at any time and receive 95% of their
valuation less expenses. Any ideas? What do other clubs do? Jeanne I guess I don't understand the problem. It's their money. They should have access to it whenever they like as long as it is within the bounds of the by-laws. Your use of the word spurious is a bit confusing. In our club if a member wants to do a partial withdrawal there is no problem. We pay out according to the by-laws. Maybe you could explain a bit. I guess that if a member was wanting to withdraw small amounts every few months that would be problematic just from a psychological perspective and could be detrimental to club morale but then you could change your by-laws if that were a problem. Cherilyn At 06:04 PM 3/13/2010, you wrote: We feel that some members are using club membership as a savings account and are withdrawing for I don't understand the problem, either. If, as Cherilyn has alluded to, you have members who want to make frequent partial withdrawals, then get the issue on the agenda for next month's meeting. State the problem, propose a change in procedure, open the floor for discussion, and vote. Majority rules.
In our club we "frown" on partial withdrawals. We don't completely rule them out. We never have enough money to invest in all the stocks we'd like, so taking money out without actually leaving our club would generally tick off other members, thereby putting you at risk of getting voted off the island.
I recomend that you propose a minimum, like $500, and it can only be exercised once every 24 or 36 months. That should take care of the problem without actually taking a stance against it.
Lynn Ostrem
Crow River Investment Club
Too often, a member totally quits the club because they are annoyed with another member, or don't like the decision we made. We are 4 years old, have 20-25 members who each pay $25/month. Our portfolio is $25,000.
On Sat, Mar 13, 2010 at 7:20 PM, Cherilyn J. Peay <cpeay@comcast.net> wrote:
Jeanne Tieken wrote: > We feel that some members are using club membership as a savings account and are withdrawing for > spurious reasons. Our bylaws say a member may withdraw at any time and receive 95% of their > valuation less expenses. Any ideas? What do other clubs do? Jeanne--I agree to some extent with all of the previous responses. We think that each club should have in it's partnership agreement, content to cover your situation. We must remember that a partner is free to withdraw at any time as long as it is within the agreement parameters. Partial WD are a different matter. If you feel your members are making "spurious" withdrawal, I would think that they should be asked for their reasons, and if not covered in the agreement, you should take action to amend with conditions as you see fit. Questions arise--do those members making WD continue to contribute on your established schedule? If so, why the WD--do they really need the funds? Are they taking advantage of the club's success? Above all, they should be reminded that the club is in it for the long haul--the "buy and hold" approach Colin Wilson, Treas, Doc Stock Inv Club At 06:47 PM 3/13/2010, you wrote: Too often, a member totally quits the club because they are annoyed with another member, or don't like the decision we made. We are 4 years old, have 20-25 members who each pay $25/month. Our portfolio is $25,000. My personal preference is to not have people who can't work together in the club. There is a huge difference between differing opinions and a lack of respect. It sounds more like this is a question of personality conflicts rather than withdrawal issues. This too can be addressed in a meeting as Lynn suggested. All in all it's better to have people leave than remain members and become either non participating or resentful. Think this should be discussed at a meeting. Cherilyn J. Peay PO Box 1408 Bernalillo, NM 87004-1408 (505) 867-4379 (505) 867-4224 fax |
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