August 2016 Lending Club Update

I have been investing $25 at a time and now have 310 notes up from 263 notes last month.  I am continuing to use the automated note selecting mechanism which lets the computer spread the capital across a variety different loan grades.

Right now as you can see above, my current return is 6.33% after all defaults and past due loans have been written down. Last month my return was 6.77% which closely mirrors the predicted 6.68% return under the Platform Mix. Also, my monthly payments have increased to approximately $242 up from around $206.

The returns continue to bounce around like a pinball as notes are written down when they become past due. If and when the notes are made current, the return adjusts upward as expected.

As mentioned last update, I have seen the returns as high as 9% and as low as 3%. It tends to stay around 7% most of the time.

I will continue to invest $200 a week until I reached $10,000. At that point I will probably continue investing new capital, but may stick with higher credit borrowers.


2016 Net Annualized Returns

July --- 6.77%
August  --- 6.33%

DEFY MEDIOCRITY

July 2016 Income & Expenses

The amounts below are cash amounts and are net of taxes, insurance, 401k contributions, HSA, etc. In other words, the amounts are what get deposited and withdrawn from my accounts.

Day job (take home pay) --- $11028.94
Dividends/Interest --- 0

Total net income --- $11028.94

Expenses --- $5298 (Taken from Mint)

Savings  $ --- Rate  $51.96%


There we go!! I finally got back over the 50% savings rate threshold. While my expenses were still fairly high, I finally broke the 2 month $7000 a month streak. That's a bad streak to be stuck on. I can live with $5,000 a month and still having a strong savings rate

I was glancing over the expenses and really didn't see much in the way of outliers.  During the previous two months I had a couple of big vacations including prepaying for a trip to Disney World. It appears that I had a lot of $75 to $150 expenses which included several dinners out throughout the month and a couple of doctors visits. Also the utilities were a bit higher as the Houston weather really heated up. Also my girlfriend's daughter has been staying with us during the summer so that probably is good for and extra $500 to $700 a month. 

Higher expenses are not freaking me out as much as they used to. Extreme expense control used to be something I really really really tried to get under control. I think that I am probably spending more money mainly because I have sacrificed so much over the past couple of decades that I am giving myself some treats. Don't get me wrong if my income starts to plummet, I can easily eliminate all cable channels, expensive meals, and other frivolous luxuries. In the mean time, I am going to continue enjoying life responsibly and not live like a hermit. 

There is a big world out there and I want to see as much of it as possible!

DEFY MEDIOCRITY

Recent Buy --- TIS & DIS

Today I initiated positions in Orchids Paper Products and Disney.

• TIS:  60 shares @ $28.28  Yield  4.95%
• DIS:  17 shares @ $97.45  Yield  1.46%

Total capital invested is $3367.33. The combined yield is 3.21% and will add $108.14 to my yearly dividends. 

After recently reaching $36 a share, TIS has finally started coming back to earth so I took the opportunity to pick up some shares around the 5% yield range. The DIS dividend yield isn't overly impressive, but the 10 year 23% annual dividend growth rate is off the charts.

I have been watching FLO recently as well and it's dividend yield is approaching 4.5% so I may initiate a position fairly soon. I don't know if it the yield will reach 5% or not, but I would definitely be a buyer there.

Forward dividends are $3500.00

DEFY MEDIOCRITY

First August Purchases --- MET & Shell

August is here and it's time to keep adding to the pipeline.

• RDS-b:  35 shares @ $52.59  Yield 7.15%
• MET:  40 shares @ $41.08  Yield  3.89%

Total capital invested is $3497.68 and the combined yield is 5.59% and will add $195.60 to my yearly dividends.

I was tempted to buy shares of BMY on a huge drop today. I already have 300 shares of PFE and a position in GILD, so I opted to add an insurer to further diversify the portfolio. I will watch BMY over the coming weeks and may still initiate a position. The yield is now around up to around 2.4% and looks pretty attractive here.

Other positions that I am eyeing closely are T, SO, PM, BA, PG, and TIS.

Forward dividends are $3400.00.

DEFY MEDIOCRITY