I placed my first deposit into Lending Club on December 31st for $100 so I was able to start the 2015 new year off fresh on an entire year for Lending Club. I am still exploring Lending Club but pretty comfortable with the platform and happy with the returns I am receiving. I have been in Lending Club for almost 4.5 months now and have put a small sampling of $250 into it so far. Just last month I decided it would be ok for me to start allocating a monthly $25 deposit into the platform on the 1st of every month. While $25 may not seem like a lot it buys me one investment note which is perfectly fine with me currently. My objective with Lending Club is to keep on growing my portfolio on a monthly basis know matter what, even if I somehow forget to deposit some sort of funds into my account I will automatically have $25 placed into the account so I can create growth. While my sampling is still extremely tiny on Lending Club I quickly realized that Investing into A and B loans was a waste of time for me and that I need to just focus on the mid tier loans which are C, D, and E loans. I have yet to invest into an F or G loan and doubt I ever will because I never look at them due to the fact that they can create trouble for me in the future. But I will say I saw a glorious F loan with what I thought was a 25% interest rate but I was on my iPhone and the loan was only $25 away from being filled. I managed to click on the loan and take a glance at the appliers monthly income which showed up as over $12,000 a month but I clicked refresh by mistake and lost the loans info. I am currently recording a 12.72% return which is pretty solid, but determined that I can raise that up to an annual of 15%. All payments have been received so far and I enjoy nerding out looking at the large selection of Loans I get to analyze. I put most of my focus onto what state the person is from, if the loan has been approved by lending club yet, the job title, gross income, but I pay the most attention to the Credit Utilization. Credit Utilization is the biggest thing I look at when I am looking at the loans. You can find some golden loans even if they have a public record on file. A lot of people on Lending Club exclude people with Public Records on file which is understandable but Im in Lending Club to make money. I will give people with 1 record on file a look but if you have two or more it’s an automatic pass. Again though I put a lot of stress into the fact that my sampling is extremely tiny still and my averages are still really skewed. Truthfully I don’t think I will have a full grasp on the platform until next January when I have been in the platform for 1 full year. I do plan on making a larger deposit in the next couple of months to start kick starting my portfolio. But I am still at least two months away from doing that. An insane feature I wish we as investors had access to seeing would be being able to see what credit cards these people owned. If I was able to see the types of cards the people seeking loans owned that would solve a lot of risks for investors. I get enjoyment out of selecting my loans manually. I saw a company called Lending Bot created a robo platform for Lending Club and Prosper but I feel like you lose to much value with a platform like that. If you are a millennial joining the program you almost certainly have a smart phone and will be able to select your loans on your phone. I hope to participate in the SOFI IPO when they decide to go public and decided to take a pass on the ONDK IPO which went public about 4 months ago.
I am on a mission to find way to earn interest for every single day of month. I looked at the idea of seeing an average of 30 days a month instead of 31 days and then just multiplied the 30 days by $25 which came out to $750 for 1 loan a day at 30 days. I already receive a few payments from multiple loans on the same day, but will still look at receiving two payments on 1 day as if I am receiving them on two separate days. Timing the loans to land on every single day of the month would be near impossible Im assuming. I am on board with Lending Club and hoping for it to be a continued success!
The year is coming to an end and Im pretty optimistic about next year and the gains I will be making financially in the stock market. I opened up an Acorns and Betterment account in the middle of August and went straight to work with both of those accounts trying to create a portfolio of some sort through both of the new mobile platforms. Since I opened both of them at pretty much the same time I was able to track the performance of both of them. I always noticed that while I put less money into Acorns it always had a higher return than Betterment. And it has held true since the beginning with me. The reasoning behind this can be because of a couple things. One of them being that the platform is based more on micro investing while Betterment is based on larger sums of money being deposited in. So with Acorns I am buying on micro tiny dips on a daily bases where as Betterment I am buying only once or twice a month typically. But the biggest difference I have noticed is that Acorns offers a REIT ETF and Betterment does not. I currently have $543.30 in my Acorns account including Dividend Payments that will process tomorrow. With $23.82 in GAINS including tomorrows Dividends that have not processed yet. Thats pretty dam impressive for only having around $550 in my Acorns account. Which is why I like having 2 portfolios currently because on Betterment I have double that amount of money invested into my account and my GAINS are HALF of that. Betterment I am currently posting $1028.32 including Dividends Payments that will process tomorrow also. My Dividend Payments were 33% higher than what they were on Acorns. My GAINS were half of what Acorns were and I have double invested in Betterment. Im showing a $13.32 Gain. None of this is anything for me to startle over though. I noticed that Betterment is a little less volatile than Acorns and offers better Dividends than Acorns which in the long run is what matters the most. But if you really had to select between the two and were really tight on funds Acorns is the way to go currently. Acorns just launched a better monthly fee platform which is only $1 a month until you hit $5000 then it is only .25% a year. So you are ponying up $12 a year to watch your money grow. As opposed to Betterment which offers smaller returns but is less volatile you are charged $3 a month if you do not deposit at least $100 a month or .50% if you do deposit that. Overall the young ride has been pretty fun so far. Long Term Investing is easy once you start seeing Dividends arrive into your account. 2015 will be my first official year in the stock market where I actually know what is going on and Im pretty excited for it. The early winter/spring will be pretty light for me but ill pump up my deposits during the summer. If I deposit $100 a month into Betterment I will be tucking $1200 into my account. Which that is a Guaranteed amount for me even if I have to find a way to make it happen I will make sure my monthly deposit goes in because it is extremely crucial to my growth as a young millennial getting into the Emerging Market. Being a Millennial I am getting an opportunity to buy into the Emerging Markets of India,China,Brazil, and Russia. (BRIC) And yes I do know that Russia is collapsing hard right now but you can’t really suspect their economy to crash for another 15-20 years. I am a big believer in the Chinese Economy and keep an eye on the companies growing there. Im not a fan of the Indian Economy though while it will most likely grow I don’t see much trust or gain in what they will bring when you compare them to China. Everything is virtually outsourced to China and nothing is sourced to India…… What will India offer than China can not?
I recently just deposited my first $100 into Lending Club to play with that and see what I could expect from the platform. I only had 4 Notes to purchase with the $100 so I went through and selected 4 loans I felt pretty comfortable with. I managed to find a A,B and two D loans. None of them have processed yet so I still have to wait for them to be fully funded. Again I only put $100 in because I really have know idea what I am getting into even though I understand what I am doing.The moment I saw they were going to have an IPO I went straight to my bank account and moved money into my Sharebuilder account right away to have it ready for the IPO. I knew the IPO was going to be ginormous and it rightfully was. The platform and tools they offer for investors and people looking for loans is simply amazing. Being on the secondary market is true crap though. I got stuck buying in at $23.74 I believe, I still bought though because I didn’t think I would see the shares drop much lower than that ever again.They closed today at $25.83 but its been really volatile. I am a firm believer in the company and think that the growth in this company will be huge in the upcoming future. P2P Lending is going to be huge and I expect P2P to have its own sector in five to ten years. This should be a massive growth field. As far as me investing in them through P2P Lending Im pretty optimistic about the 4 loans I selected and hope to see a profit. If this ends up working out properly for the first 3 or 4 months where all 4 people pay out properly, I will happily put another $250-$500 to start pushing for more growth. My Lending Club Journey has begun and I hope to see it prosper!
It’s December 2nd and my deposit processed this morning for todays trading to begin. I had a $100 deposit process into my Betterment account and was happy as usual on my timing. The day before the market took a pounding and I ended up being down 1.5%. I had a solid return on the dip. If you take a look at the chart below I zoomed in on the VOO which is the Vanguard S&P 500 ETF
So first we take a look at the entire week which during this period dates between November 25th and December 2nd. Look at that massive plummet due to oil prices on the 1st of the month. Incredible because on that day Apple also ended up down -3.25% and even today ended up being down another -.38% today. A lot of people think the sell off was due to people just taking profits, but also because Black Friday and Cyber Monday sales didn’t produce what share holders were hoping for. Which if that is the cause that seems a bit silly due to the fact that Apple rarely puts anything on sale. While I titled this buying on the dip their is know actual way of knowing if you are going to buy on the dip until the market actually opens. I just seem to get lucky and end up processing buys on the dip. These buys have brought me solid rewards though.
The S&P 500 is still looking for another 184 points to close out the year. Would be pretty awesome if it closed out at the projected 2200, but who really knows. I recently posted an article on Millennials in a Bear Market. A portion of it was about rising interest rates and trying to situate myself during that time period. I did a bit more research and the consensus seems to be that even when interest rates do rise the rates wont rise to anything above 2% and it will take a good amount of time to even reach 2%. So I do not think I have to sound the alarm that much. A lot of analyst think 2015 will be a pretty calm year, but thats fine hopefully it gives me a chance to situate more funds on the low and reap the rewards the following years.
On a side note I have decided that sometime in the near future I am going to open a investment fund specifically for Black Friday. Im gonna create it on Betterment and just set it to a target goal of $1000.
Should I as a millennial be praying for the stock market to go into another mini correction, should I be hopeful for the market to drop 20% or even 30%? I see that Japan and many of the European states are under dire distress right now falling into recessions and just barely avoiding falling back into them. Japan is undergoing a triple dip right now and buying up as many bonds from America as possible. Germany and France just dodged falling into recessions again and Greece has pulled out of recession status by only a smidge. But over here in America…… things are on cruise control. The S&P 500 is setting record highs and on track to close the year at 2200 points. It puts a lot of stress on the economy and the businesses to perform well though. Seriously Apple makes up 3.62% of my portfolio and they are going rampant. I was not expecting Apple to climb this high this fast in such a short amount of time and quite frankly I don’t think very many people were. To give you a reality check Apple as a company is worth more than the entire Russian Stock Market which is just crumbling and falling to pieces. A Russian Rouble is worth only $.02 in America when converted and getting drastically close to only being worth $.01. With QE over and Federal Government set to raise interest rates in America a lot of analysts are projecting interest rates to rise in the middle of 2015. Which leads to the question I keep asking myself. Will America go into a Bear Market or will America be America and just decide to defy history and continue on into a bull market? The first 6 months are supposed to be extremely bullish but the following 6 months would be projected as entering a Bear Market. Interest rates rising cause returns to drop for every single percent interest rates go up, returns in the market drop the same. As a millennial though I would have to assume that while a large portion of our generation doesn’t have any money invested in the market those of us who do have some sort of income attached to the market should be interested in watching the market drop 10%-20% while we still are young. I am still brand new to the market but extremely fascinated with how it works. And for me as an individual to find a way to shine faster I need the market to drop while I am young for a couple reasons.
1. I need to see how the market responds and what a Bear Market is like when I am young.
2. I need to be greedy and unafraid while I am able to take a hit.
I was able to be apart of the the latest correction that occurred in the middle of October when the market just plummeted 9%-10%. That was pretty interesting because my deposit had just processed that day so I was getting a good laugh out of it. That 1 week of turmoil brought me my first returns of 2%, due to the fact that the market instantly slingshotted back the following week. I currently only have a little over $1100 in the market and will close out the year around $1500-$1600. Which obviously isn’t a lot, but interesting to me because I can see the power of what compounding interest does. I have been pretty fortunate to buy on basically every little dip.
I try not to look at the aspect of what and how much money I have in the market right now. I am more so trying to just save for the future. I have lived a pretty condensed life in San Francisco and am pretty determined to defy odds in this city even though it is the most expensive city in the country to live in. I tend to only pay attention to opportunities in front of me and avoid making or going into situations that simply do not offer any sort of important knowledge or opportunity for me. I think that is something that a lot of people in my generation fail to recognize. Seriously if I lived in Chicago or Boston or Seattle I would be on cruise control and easily have put twice as much in the market already.