How Peer to Peer Lending Works

A relatively new money lending phenomenon has been growing over the past few years. P2P, or peer to peer lending, is a great resource for those wanting to borrow money at competitive rates or for those wanting to invest their money for a decent rate of return. With the economic climate so bleak lately, many of you might be wondering where to invest your money for a decent rate of return. If so, P2P lending is definitely worth consideration.  It isn’t risk-free, nothing is, but if you carefully choose borrowers with good credit scores then it is safe to say you can easily expect a 7 to 9 percent return, which beats recent stock market performance and definitely surpasses CD and bond rates.  I’ve made a hefty 18% return from my lending portfolio over the past 2 years.  However, I do lend to less creditworthy borrowers, which allows me to demand higher interest rates.

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Sticking It to Banks is Fun!

It seems that I read a new article at least once a week concerning the panic that has set in among bank executives about peer to peer lending. Why? Because capital is the life blood of a bank’s earning potential. In case you aren’t aware, banks make their money by making loans and earning interest from them. But, where do they get the money to make these loans? From the deposits that YOU and millions of other people give to them. So, they instead of you, are making money off of your capital. They like to make you think that you’re getting a good return on your deposits in the form of CD’s and interest bearing savings accounts. But, the returns on these are measly compared to what the bank is earning. If you haven’t guessed it by now, I think banks are basically leeches. Anyway, back to my original point – if customer’s aren’t filling the bank’s coffers with their money then the banks can’t use it to earn more for themselves. The growing popularity of peer to peer lending has caused an increased amount of capital to be put into the vaults of peer lending networks and a resultant decrease in bank vaults. This is good news, screwing the bank is always fun!

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Money Saving Tips for College Students

The beginning of a student’s college years are some of the most anticipated and exciting in a young person’s life, both for the student and the parents. However, financially, they can also be the most burdensome. Students and parents are often at loggerheads over the student’s college spending. For the student, with newly found freedom, there is an urge to charge full tilt into extracurricular activities without a thought to their cost. The parent often wants their child to enjoy their college years, but also wants them to understand that the money doesn’t come easily. Here are some simple money saving tips for college students that will stretch the dollar further and reduce stress between parent and child. Continue reading »

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Weird Scholarships Are Waiting for Your Application

Many college students make the mistake of thinking that they wouldn’t qualify for scholarships because their grades aren’t good enough or they aren’t an athlete or an artist. Well, banish that thought from your mind. Each year there are thousands of scholarships awarded by some very obscure organizations, which are based on very unlikely criteria.  Some of these are awarded for the strangest of reasons.

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Why Are Textbooks So Expensive?

The Textbook Market

We all groan over the financial burden of purchasing a semester’s worth of books. But, why are college textbooks so expensive? How is it that one can purchase a book from a bookstore of comparable size and weight for 20 to 30 dollars, yet a college textbook sells for 100 to 150 dollars? Well, the answer has to do with the basic principle of consumer choice, which affects the demand for a product. In a typically efficient consumer market the buyer has a choice about purchasing the product. If the price of the product is too high then nobody buys it. So, the producer of the product lowers the price until people start buying, therefore triggering demand and voila, the market price has just been found.  This is called price discovery.

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The Cheapest Textbooks – How to Find Them

It’s that time of year again, the beginning of the school year. For college students, or most likely their parents, finding the cheapest textbooks is a pressing concern. Everyone knows how expensive they are. I don’t think it needs to be stated that college bookstores are definitely the last place to shop, even their used book prices are enormously inflated. The best way to find discounted textbooks is by spending a little time doing some comparison shopping. This has never been easier than in recent years with so many textbook websites popping up.

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How to make extra cash recycling your old electronic gadgets.

I’d be willing to bet that you have quite a few old cell phones, laptops, or other electronic devices lying around your house and simply taking up space.  If you’re like me (a pack-rat) you’ve stashed them away thinking that you might find some future use for them.  The reality, of course, is that these electronic gadgets haven’t been touched in quite some time and probably never will.  Throwing them away is a bit disconcerting as well since they’ll just take up space in ever-growing landfills.  So, what do you do?  Well, here is where a company called Gazelle enters the picture – they will purchase these used electronics from you!  Recycling may be a bit of a misnomer though.  Most of the electronic items they purchase are actually resold through various retail or auction markets.  Some are sold to large wholesalers, who of course then resell them to consumers looking for secondhand electronics.  Only when there is no resale value does Gazelle send the items to a recycling center.  In any case, what is important is that your used electronics are recycled or resold rather than remaining in your junk drawers or ending up in a landfill. Continue reading »

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6 Frugal Tips That Will Save You Money

Everyone is trying to tighten their belts in order to save money these days and frugal is the new buzzword.  But, after so many years of people spending rampantly beyond their means many are finding that they have forgotten or don’t know how to be frugal.  So, here are six frugal tips that can help you save more of your hard earned money.

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Get a Peer to Peer Loan with Lending Club

Getting a peer to peer loan is a novel way to borrow money, especially considering that fact that banks have been pretty tightfisted with their money lately (excuse me, I mean “YOUR money lately”).  While I don’t recommend immersing yourself in debt, there are legitimate reasons for needing a loan – debt consolidation, student loans, business ventures, etc.  So, if you’ve got good reasons and are having trouble getting a loan then consider peer to peer lending.  It is increasingly viewed as a godsend by those who really need a low interest loan for legitimate reasons.  People are embracing the idea of borrowing money from ordinary people that are just like themselves.  And what’s more, there are plenty of people ready and willing to lend their money.  With equity markets in turmoil, more and more investors are turning to peer to peer lending as an alternative investment avenue and since everyone hates banks, it’s a win win situation!  So, because person to person lending cuts out the middleman (the bank), two things happen: interest rates for the creditworthy borrower are lowered and the likelihood of getting accepted for a loan is raised. When the lenders are regular people just like you, they are much more likely to be sympathetic to your plight.

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File your tax return online for free

The IRS has now made it much easier to file your taxes online. You can now get your federal income tax return prepared and filed online for free if your AGI is $56,000 or less. They do this through partnering with a number of tax software companies. You no longer have to go out and pay for tax software to do the job, unless of course you prefer to do it that way. These companies collect all of your tax information during an online session, prepare the tax returns, and then e-file them with the IRS – all free of charge. E-filing is the quickest way to get your tax refund; giving you the option to receive it in 10 days by direct deposit. Most of these tax software companies charge about $12.00 to do the same with your state taxes. This is because most state revenue departments don’t offer free e-file. On the other hand, you could simply file your state tax returns the old fashioned way (by filling out the tax forms and mailing them in) and not have to pay for state or federal. State returns are usually easy to do since you often just transfer the information from your federal return onto your state return.

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