Prosper Peer-to-Peer Lending Getting With the Program

I haven't made a loan at Prosper since Oct 2008. Since 2006, I have entered into nearly $5000 in loans. Many of them risky. My net gain/loss has been ($38.35) at Prosper. I still have 32 active loans at Prosper and I suspect that before it's all over i'll eeck out a few dollars in gains.

I have been reinvesting my blog's earnings at Lending Club in $25 loans and have had nice returns (~9%). Initially, I hated the Lending Club interface (as compared with Prosper.com). However, I have grown use to Lending Club. I particularly like the fact that you can bid a minimum of $25 on loans. The time spent searching for loans hardly justifies minimum $25 bids unless you approach it from a hobby perspective.

I had almost written off Prosper until I got the below email announcing they have switched to $25 minimum initial investments and have a new risk rating system. Now, I will at least reconsider reinvesting my existing Prosper loan distributions (in safer loans this time).

All of us at Prosper would like to thank you for investing through our marketplace. We are eager to have you come back to Prosper to invest in your fellow Americans once more.

As you may have heard, we're now offering several additions to our marketplace, like an Improved Risk Rating System. We've also lowered our minimum bid to $25, so you can better diversify by bidding on more loans.

Since our relaunch we have seen a dramatic improvement in the quality of listings. In fact the average credit score of listings in the marketplace has improved to 700 in the first month since re-launch. And 16% of the listings have a Prosper Rating of AA to B.

These tough economic times require a new approach to investing and Prosper provides you with the transparency and best-in-class rating system you deserve.

Please consider coming back to lend on Prosper – you will have the satisfaction of knowing you are helping your fellow Americans get the loan they need.

Regards,
Prosper

Recommended Personal Finance Articles From: Free Money Finance, Fund My Mutual Fund, Darwin's Finance, Northern Cheapskate, Paper Economy and Others

Here's several recommended articles from those sites that share links with Plugged in Finance. I hope they are of use to you.

Free Money Finance. "Why Annuities Are a Bad Investment."

Fund My Mutual Fund. "Ron Paul With Dylan Ratigan."

Darwin's Finance. "Price to Earnings Ratios Gone Wild - A Measure for Investors to Follow?" This is a good recap of a more robust Business Week article. Good charts included in Darwin's article. Click through to Business Week article for additional charts.

Northern Cheapskate. "Free Will And Trust Kit From Suze Orman."

Paper Economy. "New Home Sales: Aug 2009."

Financial Armageddon. "Another Crop of Interesting Indicators." Indicators like the Hot Waitress Index, etc.

The No-Spend Zone. "Flying Free (Or Rather Insanely Cheap)"

Military Money Might. "A Sample Dispute Letter to Send to The Credit Reporting Agencies."

Getting a Free Breakfast (You Can Too)

Just went to a few websites and got several free cereal samples.

* Kashi Honey Sunshine Cereal. Got to free sample form.
* Fiber One Cereal. Go to free sample form.
* Total Blueberry Pomegranate. Go to free sample form.

Recommended Personal Finance Articles From: Free Money Finance, Darwin's Finance and Dividends 4 Life

Here's several recommended articles from those sites that share links with Plugged in Finance. I hope they are of use to you.

Free Money Finance. "Dirty Little Money-Grubbing Healthcare Secrets."

Darwin's Finance. "Best Places to Work: Surprising Survey Results and Analysis."

Dividends 4 Life. "Building Retirement Income Streams With Dividend Stocks."

Finally, the following article was not from a site that shares a link with Plugged in Finance. It's useful in that it maps out the United States and shows forecasted date ranges for when U.S. region housing prices will hit their peak in price again: Dr. Housing Bubble Article.

IRS Lowering 401K Maximum Contribution Limits in 2010?

One of the common pillars of retirement advice is to "save more." Some people who have watched their 401Ks slide into the realm of 201K are seriously considering investing more in an effort to catch up. If you're in this group, you might be in for a rude awakening in 2010.

The IRS determines 401K maximum contribution limits based on a formula using 3rd quarter consumer price index for all urban consumers (CPI-U). In the recent past, the CPI-U has pushed higher each and every time the IRS did their calculations. However, in Oct 2009 the 3rd quarter CPI-U value may very well be lower than in 2008. Since March 2009, the CPI-U has come in lower than its corresponding 2008 value. What does this mean for 401K maximum contributions? Well, it means they could go lower. Initial thoughts are that 401K maximum contributions could be about $500 lower in 2010.

Here's an Associated Press article that talks about it more.

Recommended Personal Finance Articles From: The Digerati Life, Free Money Finance, Fund My Mutual Fund, Dual Income No Kids Finance, My Open Wallet

Here's several recommended articles from those sites that share links with Plugged in Finance. I hope they are of use to you.

The Digerati Life. "Pet Care Costs: How Much Does Your Dog or Cat Cost."

Free Money Finance. "What Do You Plan to do in Retirement."

Fund My Mutual Fund had this CNBC video on his website. I find it very interesting that something bad in the markets may be lurking.



Dual Income No Kids. "Track Investments With Mint.com." Article shows cool red/green color coding comparison of individual investor's performance relative to broader indices.

My Open Wallet. "Unintended Consequences: 401Ks Mean Fewer Jobs for Younger People." Excellent article. In a tangential way, I infer from this article an increased importance in the need for universal health care for U.S. citizens to help ensure a stronger socio-economic safety net.

New Thrift Savings Plan (TSP) Features

Thrift Savings Plan (TSP) upgrades were included in the "Family Smoking Prevention and Tobacco Control Act" legislation as riders.

Four key planned features were addressed:

(1.) Roth 401(k) option. The Federal Retirement Thrift Investment Board states that it could have the ROTH option ready in one to two years. Most recently, I have read mid-2011 on some sites for ROTH-TSP implementation.

(2.) Automatic enrollment of new federal civilian employees. Contributions would go directly to the G-Fund. Employees would have 90 days to opt out and receive a full refund. The bill left it up to DoD as to whether or not military personnel will be automatically enrolled. DoD has stated that they will automatically enroll personnel in TSP once the ROTH-TSP option is implemented.

(3.) Survivor benefit that would let spouses of deceased TSP participants maintain accounts.

(4.) Mutual fund option that would let participants invest TSP funds in select private sector mutual funds. The Army Times reported that:

It's far from certain that the TSP board will follow through and offer a mutual fund option. Executive Director Gregory Long has described the board's attitude toward mutual funds as "agnostic," though he added that such an option in the TSP could be a "proving ground" for different investment options and could dissuade lawmakers or third-party groups from trying to add new funds to the plan.

You might also be interested to know that TSP now has a feature called the Personal Investment Performance (PIP) number. Your PIP truly reflects your own TSP return.

"The Personal Investment Performance (PIP) number is a combined rate of return earned on all of the funds you held in your TSP account during the year covered by the annual statement. Your personal performance is based on the performance of your investments and on the timing and amount of your purchases (e.g., contributions) and redemptions (e.g., loans and withdrawals) as well as the effect of any interfund transfers. Therefore, your personal performance may differ substantially from the performance of the investments themselves. The TSP uses the Modified Dietz method to calculate Personal Investment Performance. The Modified Dietz method weights individual cash flows by the amount of time that those cash flows are held in the portfolio. This method of calculation is widely used by financial analysts and investment managers to measure the time-weighted returns of investment portfolios." Source: Alamo Gordon News, 6 AUG 2009