My Ramblings Articles
Back in July I opened an account with Lending Club to make some money. The banks aren’t paying squat with interest and even CDs aren’t paying that much. Right now I’m staying away from the stock market after losing money over the last several years.
After doing some research I found Lending Club compelling and decided to initially open an account with $5,000. However, I added another $5,000 when Lending Club offered a $200 bonus for new accounts with at least $10,000 (after watching their webinar – presentation via the Web). Lending Club also offered to help me with lending the loans. I just had to tell them what risk level I was comfortable with. I also found this compelling because I didn’t have to worry about whom to choose to lend to.
For those not familiar with Lending Club, it is a social lending network that brings together investors and creditworthy borrowers to lend money that cuts out the middle man; traditional banks. The process is sometimes referred to Peer-to-Peer lending (P2P). Lending Club takes a small 1% commission from lenders to conduct business. Borrowers pay a processing fee depending on their creditworthiness which range from 0.75% to 3.5% of the loan value. (Read more here about how Lending Club works).
In August/September most of the $10,200 was loaned to 85 individuals. So the average loan is about $120. To date my account total is $10,521.53 with payments to date of $373.87 ($290.50 principal, $84.37 interest, $0 late fees). To date that’s a 5.2% return (includes the $200 bonus). Without the bonus the return is 3.2%. Not bad at all! Lending Club has calculated that my net annualized return should be 11.05%. Where can you get that type of return today? This assumes of course that the loans are all repaid. (See screen shots below)
Lending Club Account Summary
Lending Club ranks borrowers from A to E. A being the lowest credit risk, however, with the lowest interest rate. E is the highest risk, however, with the highest interest rate. Starting out I was conservative and only loaned to A and B borrowers. According to Lending Club no A borrower has ever defaulted on a loan. Over the next several months I’ll post updates of my Lending Club account performance.
For more information visit LendingClub.com.
Below is a very interesting picture. The picture is of sculpture created by Chinese artist Chen Wenling which critiques the global financial crisis. The sculpture depicts a man with horns (or the devil) pinned to the wall by the Wall Street bull who propels himself/herself by a boost of “personal air” :-). The man/devil said to be pinned to the wall is jailed ponzi scheme financier Bernard Madoff. The sculpture is on display at a Beijing gallery.
From time to time over the years I would forget to pay a bill on-time and would incur a late fee. One of the reasons is that the bills all had different due dates. I hate paying late fees so I’d always call the company charging the late fee and request for them to remove it. Most of the time they will remove the late fee, but this takes unnecessary time to do.
Now I don’t have to worry about this because thanks to technology all my recurring bills are paid automatically. I’ve put my bill payments on auto pilot. No more remembering to pay the bills, writing checks, buying stamps and mailing the checks.
I use 3 credit cards which are paid automatically. Of course before the bills are paid I’ll review it to make sure there are no fraudulent charges. My mortgage, satellite, phone / Internet, cell phone, gym membership, water, electric, garbage and home alarm are all paid automatically.
Most companies will offer auto-payment which will bill your credit card or deduct the money from your checking account. If a company doesn’t offer auto payment I’ll setup auto payment via my bank account. For instance, my water company doesn’t offer auto-pay, so I set up an auto-payment in my bank account to send a payment every month of $50. My water bill fluctuates below $50 so I carry a credit in my account.
Having my bills on auto pilot saves time (no writing checks, mailing checks or calling for a late fee to be removed), money (no late fees, buying stamps, envelops, and driving to the post office) and having to remember to pay bills.
Related Article: Five Things I Don’t Like Paying For
Below is a very interesting video by The Economist of how social media, the Internet, cell phones and technology has changed our lives.
Mixcloud is an online radio site that wants to be the “YouTube of Radio”. The site helps connect radio content to listeners via radio shows, Podcasts and DJ mixes. And best of all, it’s free! (See video below).
Mixcloud refers to the radio content as Cloudcasts; audio shows that are stored in the “cloud” and available to be streamed on-demand.
Like YouTube, anyone can create an account and upload their content. The community then decides what they like and what gets to the top of the popularity charts. Mixcloud accepts all types of radio content from talk to music shows that have 5 tracks or more in MP3 format.
Video: What is Mixcloud.com?
For more information visit Mixcloud.com.
Who do you think is better at money management, men or women? According to Financial Finesse, a financial education company, in the first quarter of this year more than twice as many women as men called to a financial helpline regarding strategies to reduce debt.
Financial Finesse conducted a survey of over 3,000 responses to an online financial planning questionnaire and found the following:
From the data is does appear that men are better at money management. However, from the survey maybe women are more open to reporting their flaws as opposed to men who hide their flaws.
What do you think? Please leave your responses below.
According to the Wall Street Journal, the government is using Facebook and MySpace to find tax deadbeats. State revenue agents have been mining through information posted on social-networking Web sites to find relocation announcements, professional profiles and financial boasts.
On MySpace a long-sought tax evader was found and forced to pay back taxes after he posted that he would be returning to work in his hometown as a real-estate broker; for which he gave the name of his employer. The state of Minnesota ended up collecting several thousand dollars, the full amount due. In Nebraska, agents collected $2,000 from a deejay after he advertised on his MySpace page that he would be working at a big public party.