Recently in Money Category

I've been interested in micro-lending and alternative lending for a while, so when I came across Prosper.com I was excited. It's peer-to-peer lending. It works by people putting their loan requests on the website, say for $1000 to consolidate some bills, or expand a small business they're running out of their home, whatever they want. Part of the borrower's proposal also includes the interest rate they're willing to pay.

People go to the website and choose which proposals to contribute towards. They don't even contribute a lot of money, say no more than $50 towards a person's proposal. Prosper.com collects the money from the borrower and redistributes to the lenders, taking a 0.5% fee from the lender, and a 1% fee from the borrower. Only 3% of the loans on Prosper.com are currently past due, which in my mind is not a bad rate, considering they've helped broker $27 million in loans so far.

I'm really intrigued by Prosper.com, and enthused as well. It makes me happy to see that there are companies that are willing to take on the larger financial institutions in different ways, ways that give some of the power back to everyday people.

I've started learning how to invest. I have an interest in starting to sock away money for the family and for myself. Currently, my company pays no match to my 401(k) contributions, which is fine, but that makes me wonder how much benefit I get from doing a 401(k). Usually they're considered beneficial because you get the one-two punch of tax-exemption and "free" money from your employer, but I can get tax exemption by just throwing the money in an IRA and then I get to pick the funds and stocks that I want to invest in....

So I've started the process of learning. I know that a lot of people think I'm an almighty screw-up (and they'd be right, a lot of times I am) but I do believe that I'm being smart about this. I'm not rushing into anything, I'm saving little bits of money here and there so I can open an account with someone like Scottrade or ShareBuilder and I'm reading reading reading.

I feel like I'm looking down the barrel of some huge financial need soon and I don't want to get flat-footed. So I'm doing something about it...which I guess means I'm not such a screw-up after all.