In the first part of this article series we discussed, or rather I expounded, on the problem of marrying someone who is irresponsible with money—should you or shouldn’t you go through with the wedding if your intended spouse is keeping or has kept financial secrets from you?
Congratulations! You are endeavoring to step forward onto the path of lifelong love, commitment, and togetherness with someone you cannot live without. You’ve made the wedding plans, you’ve done the responsible thing and mapped out your five year plan in detail (savings, spending, investments, mortgage, and eventually kids), and now you’re as excited as punch to share your secure and detailed plan with your future spouse. You are so excited about what the future holds for you and your beloved one until you show them your brilliant financial plan and they turn as white as a sheet.
America is the “Land of Opportunity.” Everyone has a chance to go to school, get a paying job, earn enough to buy the house with the while picket fence, and retire when they are 60. Unfortunately, America is also the “Land of Crippling Debt.” As of 2010, the amount of consumer debt in the United States was approaching $2.4 TRILLION, which, when broken down, amounts to $7,800 for every single person living in the US. Consider this; these numbers were high in 2010, how high do you think they are now? The US economy is taking a nose dive and every man, woman, and child in this country is feeling the debt effects–but there’s hope.
Have you ever been in a situation where you find something you really want to buy but cannot afford it just yet? If it were the old days, you probably will save up for it first then go back and buy it as soon as you racked up enough cash. But that’s not the way things happen anymore. Now, many people given that same situation will pay for it using a credit card instantly, thinking they have at least a month to save for it.
Have you ever heard of the term debt to income ratio? Although this term may not be as popular as the credit score, this is also something that lenders like to look at when evaluating their borrowers. This figure is important because it represents the cash flow of an individual. So, if you are planning to get a mortgage, it’s important for you to know what your debt to income ratio is so you can self-assess how well you qualify.
After posting my Lending Club investment strategy and returns for over a year now, I thought today was as good as any to post a quick summary and track my net annual return volatility. Summary Outperforming Lending Club’s benchmark index of 9.7% by ~4.5%. Loan payments generate ~$250/month of cash for reinvestment. Defaults: 2 loans […]
I’m a great believer in luck, and I find the harder I work, the more I have of it. – Thomas Jefferson. Like all things in life, if you’re willing to roll up your sleeves and do a little bit of work, the chances of something good happening are in your favor. It doesn’t happen […]
Fairly sobering stuff when forced to visualize the amount of money we don’t have to cover the promises we’ve already made. Guess no one told the “fiscal conservatives” in Congress that it would take the entire world’s GDP plus a few trillion more to meet our total debt and unfunded obligations. (Might help to disengage […]
One of the upsides to having insomnia is you watch all sorts of things you wouldn’t ordinarily watch. Case in point, this humorous quote from an old James Cagney flick One Two Three filmed during the Cold War which couldn’t have sarcastically summed up the Achilles Heel of capitalism and forecasted the financial crisis any […]
They say you always remember your first more than the others… So yes, after 1 1/2 to 2 years as a Lending Club investor, I finally got hit with my first default where a small $24 loss took my pretty little 15.64% NAR out behind the woodshed to a tune of 0.86%. A 14.78% NAR […]
One static component of my constantly evolving Lending Club investment strategy is identifying borrowers who have a fairly long history of employment. In other words, that means: the older the better (but not at or beyond retirement age). 10 years plus with a single employer. decades of experience often imply management material. As the above […]
In an older post that made the rounds with the entrepreneurial and innovation crowd, I touched upon the idea that the Internet is making middlemen obsolete. This isn’t a novel concept, but if you’re in a business where you’re acting as an intermediary — a centralized position where you purposely keep your customers away from […]