Hard to say without knowing the full picture, but its the sort of investment I would put into the speculative/play category that should occur way after the basics like savings/retirement/paying down debt etc.Thank you for the feedback Matt. So I assume you suggest I avoid both companies.
Thank you for the feedback. Do you use one of the automated systems to get your 6% return?[edit: if you do plan to invent 5K+ let me know and I'll give you a referral link for $100 bonus. Not sure if this violates any forum rules, but I won't get any bonus on my end anyways]
Ok thanks.Hard to say without knowing the full picture, but its the sort of investment I would put into the speculative/play category that should occur way after the basics like savings/retirement/paying down debt etc.
You sound in good shape. To be clear though, I'd consider play coming in later than that But at these levels it's all good.Ok thanks.
I have nearly a year of living expenses in savings, which I add to monthly.
I contribute the max to my 401K.
Other than my mortgage I have no debt.
So as you suggested I will consider this play.
Could it be possible that the Mr Money Moustache lending club experiment is one giant charade motivated by the Lending Club affiliate money?There are a few blog posts out where people tried them to show the "real" return. Mr. Money Mustache is one of the better well known one (http://www.mrmoneymustache.com/the-lending-club-experiment/). One problem here is, the success is getting better with the amount of loans. Actually LendingClub has a nice return statistic on https://www.lendingclub.com/info/statistics-performance.action If you look closely at this statistic you can see that you can even loose money if you have 500 notes ($12500) invested. Not with the highest likelihood but its possible.
I myself started to invest only $500 of "gamble" money to see how it really is. After two years I added more. But I will never go in it full. One change that made LendingClub more beneficial to me is the auto-reinvesting (you find blog posts that says you need to have $X for this, but they changed it). I see Lending Club like a 3yr/5yr CD: I won't get the money until the end of it (or with a much more horrible penalty as a CD).
I think one question you need to ask yourself is: How long do you want to invest (only 3yrs or 20yrs?) and what do you want to beat? Do you want to beat average long term 7% in the stock market vs a riskier 10% at LC? What all the P2P services I know didn't have to face so far is a economical recession. How will the total numbers look if the unemployment rate goes significantly up like it did in the past?
I doubt this. If that would be his goal I think he wouldn't update the page that frequent and write much more blog posts to get cash out of much more affiliate programs.Could it be possible that the Mr Money Moustache lending club experiment is one giant charade motivated by the Lending Club affiliate money?
That's true. But how many CC reviews or even suggestions are out there that do not compensate the author? You basically only find them in forums. So do you find the unpaid, honest LC reviews. Yet I still find such blog posts with real numbers helpful and in 99% of the cases trustworthy. But you always need to read between the lines and question it.I've yet to read a blog review talking about performance of lending club or prosper that doesn't compensate the author. That's an important thing to remember.
So, assuming that the numbers are real, what is compelling about LendingClub? The link you show highlights two charts, the Adjusted NAR and then some stuff about diversification. If we leave the diversification aside for now, what is the performance of Lending club against something with equal risk?That's true. But how many CC reviews or even suggestions are out there that do not compensate the author? You basically only find them in forums. So do you find the unpaid, honest LC reviews. Yet I still find such blog posts with real numbers helpful and in 99% of the cases trustworthy. But you always need to read between the lines and question it.
There is none to compare with. Time has to show. Comparing long term investments with the S&P500 (or similar index) isn't a bad idea. But did you ever compare the risk of the S&P500 with the Nikkei (Japan stock market, http://www.tradingeconomics.com/japan/stock-market). It had it's peak in the 90's and never recovered from it. Will you take now all the money out of it because there is some kind of risk of big loss that won't be recover for decades? Do you remember all these extremely secure AAA home mortgage packages?So, assuming that the numbers are real, what is compelling about LendingClub? The link you show highlights two charts, the Adjusted NAR and then some stuff about diversification. If we leave the diversification aside for now, what is the performance of Lending club against something with equal risk?
Does the S&P 500 have more or less risk than Lending Club? How does it compare of the past 3,5,10 years? Should it be used as a benchmark?