Divine Mind Money Series (Part 2)

 Good Sunday Morning! This is the second installment of the Divine Mind Money series, where my aim is to share the different programs that have helped me in regards to money. Yesterday, I posted about the Diva Money Club, which was created by four Divas, on a mission to coach others to replace their salary in 12 months or less...with multiple streams of income. Today, I bring you my money investment secret weapon, Lending Club. I know, another club, right? Well this Club is for those who want to grow their money passively! I don't "save" money anymore. I only invest. Why? Because bank interest rates are CRAP! Let's just call it like it is. Unless you have $100,000 in your account at all time, your bank interest is not going to grant you much return and even then there's a better way to get the return you deserve.

The basics of Lending Club breaks down to this: People need loans for things like credit card consolidation, major purchases, etc. Instead of trying to get this loan from big banker, they turn to peer lenders (that's us!) to fund their loans, known to us as "notes". Multiple lenders invest in their loan until the loan amount requested is fulfilled. As payments on the loan come in, the investors receive their principal back (the initial investment) plus interest.

Let's take a real example:

 This is a screen shot from my actual Lending Club account. This is one of the twenty notes I'm invested in. You can see in the box on the left, it shows the date the loan was issued, the amount I invested ($25 is the minimum amount you can invest in any note), the total loan amount, the interest rate, the loan term (in this case 3 years, some run 5 years) and the status of the loan (current, late, defaulted). In the box on the right, it shows my last payment, how many total payments I've received so far, and then break downs how much of each payment received went towards my $25 principal and how much towards the interest.

This box tells me when to expect my next payment, how many payments are left in the term and how much I will have received one the loan term is fulfilled, The date of my final payment, and how much of my $25 principal is still outstanding.

This is my overall account summary. It show my Net Annualized Return, as it stands right now, this number fluctuates as payments from my various notes come in. Since I started, my return % has stayed around 14%. The middle box shows the total interest I've received so far, and under that my total payment received. The box on the far right is my account total which equals my outstanding principal, the outstanding interest accrued and available cash from payments received (which can be withdrawn to my bank, or saved until it reaches $25 for reinvestment.)

The great things about Lending Club is that you only need $25 to get started. The concept of peer lending is easy to understand, at least for me. I could never really get into stocks and mutual funds because I just don't understand how they work, and I like to think of myself as a pretty intelligent person. Lending Club does all the pre-screening of the borrowers and will share you, as the potential lender, relevant information such are credit score range, current employment and monthly income, and also their debt to income ratio. Potential lenders are also able to ask borrowers questions before decided to throw money in their pot. I also like that the investment terms are not super long, only 3 to 5 years. I don't have to wait 20 years for a good return!

Bottom Line, I love Lending Club, and I definitely think it is a service worth checking out.