I'm just some guy who is aged somewhere in the middle and looking more forward than behind right now. I'm married with two kids. We live in the mid-west and own our home on a mortgage. I'm a geek, nerd, techy, trekkie (Picard FTW), nature lover, geocacher, computer-builder and self-diagnosed financial dummy.
As far as our situation when I started this thing, well I suspect it's not too far off where many other people are/where. I had a car loan, student loans and a mortgage. Luckily, we had avoided credit card debt for the last several years.
I have been working a steady government job and my wife had been working in the corporate world but recently quit to stay home with the kids. While at home, she was able to pick-up a little work and we plodded along.
I have a pension coming as long as everything works out the way it's supposed to and that is supplemented by a small 457 plan. My wife had a 401k that she pulled and rolled into an IRA.
So, we finally paid down the student loans. Then we finally paid down the car loan. Now we are debt-free* (except for the mortgage). I started looking around at further investment opportunities and increased my contributions to our existing plans. I stumbled upon P2P lending and said to myself, "Self, why not give that a whirl?" I mean, here we had been giving out money to the banks all these years and all they did was suck up all this interest. Why not I be a 'bank' and suck up some of that interest? I know I don't get all of it and I know I won't see all of the loans go to fruition, but it's better than a stick in the eye. And the best part is that I don't have to put up a huge amount of cash to get started (because I don't have a huge amount of cash to get started).
That has been going along fine until a rumor popped up that Lending Club may be announcing an IPO sometime and a further rumor (don't you just love internet rumors) that they will be using Loyal3 as a vehicle to do said IPO.
Well being the dreamer that I am, I started looking into this whole Loyal3-thing. Turns out, you can get into individual stock buys with not-so-much-cash (because I had not-so-much-cash). And along the way I searched for this and that and stumbled onto a bunch of blogs talking about using dividend income to supplement their financial independence.
Here is where I talked to myself again, I said "Self, you should get in on this deal." But, you know, I was already. I was just small potatoes. Now I needed to learn and be patient. Someday I'll have myself some of them there big potatoes.
Great story and happy to have you in the blogging community. It is a wonderful community where folks can draw support and inspiration from one another. Feel free to let me know if you have any questions.
ReplyDeleteBack when I started investing in P2P lending, I experienced the exact same thought process. Here was a way I could earn above average interest returns, without a huge investment, and generate some passive income. I've since built a nice little P2P income stream, and will be looking to expand on it even further as time goes on. Best of luck as you expand to individual equities through Loyal3. I've had a great deal of success with them, and will continue to use them going forward to dollar cost average into some great companies.
Best of luck and I'm looking forward to following along on your journey!
It's been fun writing it down. I'm trying not to take myself too seriously and get all bent out of shape worrying about the minor ups and downs. All in all, we've been pretty lucky. Just trying to pad the stats a little before we find that quiet stream in the mountains (or a hot and sweaty beach like my wife wants).
DeleteEventually I'd like to create a P2P page that spells out my portfolio, actions and current filters. One thing at a time.
Hi!
ReplyDeleteJust a reminder that there's no reason to pay down your mortgage early unless you have a high interest rate. If you do have a high rate you can refinance. Stocks have a higher, more volatile yield. Unless you're looking for a guaranteed return, there's no reason to pay down your mortgage.
Thanks,
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Debt and mortgage are big psychological weights on our minds. We have finally gotten out of all the small debt and only have the mortgage left. The rate is good (3%) and we can definitely beat that with investments, but it's still debt and that takes 3% of a large balance right off the top. Putting a little of my monthly 'investment money' into the mortgage gives me peace of mind and the hope that when the time comes, I'll see that debt disappear a little sooner. I may not make out better than investing that money into equities, but it makes both of us a little happier. I'll take a little happy every once in a while.
DeleteI'll consider it a diversified monthly investment, a little deposited here and a little deposited there.