Since everyone is doing it, I figure why not review 2012. First, I will start with some goals I made for the year and see what I was able to accomplish.
Smart Financial Goals
Starting with the financial goals, I was not able to eliminate PMI on the rental house (yet). I looked into it during the first part of the year and found out that I would have to have a lot more equity to be able to do so. However, I have started the process of refinancing 5 of my rentals and will be able to eliminate private mortgage insurance with the refi. So, it may work out after all but in 13 months instead of 12. Grade B+
I also had a goal of paying off the business line of credit. This was in fact accomplished during the spring. However, one of the tenants lost the air conditioning in May and I had to put in a whole new unit to the tune of about $4500. Currently, the line of credit is not paid off. Grade C-
I also wanted to get the Discover Card paid off. I paid it off in November, although with other loan proceeds. Nevertheless, the interest rate is much lower. However, I recently got an offer in the mail for zero percent balance transfer with Discover for 6 months with no fees. So I paid a big chunk against another card. While not perfect, it is some progress. Grade B
I also made it a goal to make $30,000 through blogging this year. Not even close. I figure I will make slightly more than last year. Plus I made a profit. But it didn’t happen at all. I won’t give myself an F since I at least made something and didn’t cost myself anything. Grade D-
Smart Personal Goals
I did make some personal goals as well. I wanted to lose weight and get below 200 pounds. It didn’t happen. In fact, I am currently close to the highest I have ever been at 228. When I weighed at the end of the day, I was 229.2, but I had just eaten. This morning I was at 227.4. Obviously a BIG FAIL! This will become another goal this year. I may not hit 200 and won’t even set that as a goal, but I need to see something positive happen. Grade F-
As far as the de-cluttering goes, I did clean my closet. But my room is a mess. Much of it is from my daughter’s room when she moved to the basement. We have a foreign exchange student from China so had to clean out a bedroom and rearrange sleeping quarters on short notice so there is still residual chaos. We will work on it this year. Also, the basement and garage are improved but nowhere near where they should be. Grade C
Popular Posts Now, let’s take a look at the 5 most popular posts for CFM this year:
1. Does One Million Dollars Make You Rich?–This post was in response to someone who won the lottery and was still on food stamps. Now I am not sure that one million before taxes is enough to make one “rich”, but I do think that one million dollars after taxes can be used to create some decent cash flow. At least that is what I would do with it.
2. Warren Buffett, Intel, and Me–This was one of the most popular posts for 2011 as well. I guess when you make it to the first page of Google for people searching “Warren Buffett and Intel” which is what happened for a time, then your post is quite popular. However, now that he has sold his position, it is likely to get less press. I, too, sold out my position in Intel. I made about 7.5% capital gains on my Intel investment that I held for about a year. I also made 4% in dividends during that time. Not bad considering the time frame from late August 2011 to early September 2012. I would consider Intel again.
3. What Would I Do with $50,000–Again this is one of those posts which looks at my thoughts regarding investing and cash flow. Not that I have $50,000 lying around, but if I did, I would be working on getting some cash flow out of it. Currently, I would look at paying off some debt which would free up room in the budget and provide me with a guaranteed return.
4. CFM Celebrating 100 Posts with Cash Giveaway–Who doesn’t love winning cash? No wonder this post ended up being so popular. Unfortunately, earnings during the year didn’t keep up the pace that I would have liked, so I have been unable to conduct another giveaway. Maybe this year will end up being better.
5. Gotta Love Dividend Stocks–Investing and making money are some popular topics. I was making good progress on my dividend stock investing in my retirement account. Too bad that I had to pay some back taxes and cash that out. But now the taxes are paid and there is more room in the budget. Focusing on debt pay down during 2013 will be the plan.
Goals for 2013
I will be making and outlining my goals for 2013 over the next few days. I had hoped to get this post out a day or two sooner, but it didn’t happen. Nevertheless, I enjoyed the holidays so all is good.
Well, I managed to make an extra payment on the Discover Card. I was able to make this extra payment because I took some of the money that I had made from blogging in March and moved it into my personal checking account. I did let it sit for a little while until I made sure that I was going to have enough money to keep up with my blogging expenses for the month of April and the next few. The reason is because I actually lost money blogging during the month of April.
However, I do feel confident enough that I can cover expenses for the next few months, so I went ahead and made the extra payment. It has always been my goal to develop my online opportunities using only my time and not any of my own dollars, and I have been able to do that. Of course, growth has been somewhat slow as a result, but that doesn’t matter as much to me as being able to bootstrap and create something from nothing. I am pleased to say that I have been able to make extra payments and pay off some debt as a result of blogging.
Future Discover Card Payments
My main blogging financial goal for this year has been to get the Discover Card paid off. With recent changes to blogging revenue, I have to wonder from where the funds for this goal might come. I could hope that things improve later this year, and they may. I am also working hard to develop my other online income sources, but that will probably simply help to pay for ongoing expenses. I will just have to see what the next couple of months bring.
I have considered using the money that I have gotten from recycling aluminum cans for making an extra payment. I have also considered using the change that I periodically roll and redeem for dollars to make an extra payment. Of course, I have also considered looking at the stuff that I own and having a garage sale. It would be good to kill two birds with one stone, namely getting rid of household clutter and make some money in the process. The only catch in this plan would be the time involved. I will have to see how this works out.
I am still committed to getting that card paid off by the end of the year. Half of the balance will be covered through the normal monthly payments that I have been making so as long as I can keep up with the extra payments, it should happen. For now I suppose, I won’t be making any major changes, but will have to monitor the situation to see if blogging income totally disappears or if this is just a slight dry spell.
Carnivals with My Blogs
I do want to take a moment to highlight those carnivals that featured an article from one of my 3 blogs. CFM = Cash Flow Mantra, GPM = Grand Per Month, and PT = Penny Thots. Be sure to subscribe to all 3 so you can get lots of great personal financial information.
If you have been reading this blog, you know that I have to borrow some money to pay off some back taxes. One of the sources for the funds and part of my original plan was to use peer-to-peer lending. Well, there are only 2 major P2P lending outfits in the United States that I could find. They are Prosper and The Lending Club. I had hoped to get the majority of the funds in this fashion. However, Lending Club does not lend in the state of Indiana (one of only 8 where it doesn’t). So that left Prosper.
I went to the website, created an account, and filled out some basic information. Within minutes, I had learned my credit score but was informed that I did not qualify for the full $25,000 loan maximum but only $15,000. I decided that I needed to take whatever I could get since the possibility always exists that something might come up and I only had a limited amount of time to get all the plans in place to pay the IRS.
The application process was a breeze. I filled out some personal and financial information online which then went into a profile that was posted online. Investors could read about my need for funds, the interest rate that the loan was paying, and make an investment in my loan. There was also a verification process that Prosper uses as any bank would with a 3 step code for where I was in the process. This is to help investors know whether or not my financial information had been verified.
Prosper also sent out a security postcard to my address to make sure that it was actually me who signed up for the loan. This was mailed to my physical address and I was asked to enter the code on the postcard online. I thought this was a good step, but wondered what might keep someone from pretending to be me and simply moved recently. I guess if the physical address didn’t match those on a pulled credit report, it might raise some red flags.
I also had to send in some documentation to verify my financial information. This worked out rather well also. I filled out the application on a Thursday evening and was already getting some investors by the next morning. I was a little delayed in getting back my financial information since I was out of town for the weekend. But once I had the time to get the documents together, it couldn’t have been any easier.
I was able to scan everything into my computer and email it back. I needed to send in the latest W-2 form, a recent pay check, and my bank statement to verify the income. I also sent a cancelled check that was used to set up the automatic withdrawal from my checking account to make my loan payments.
Watching the Funding Roll In
Watching the loan get funded was an interesting process. There were several investors that first night, then some more over the weekend. Activity seemed to slow down after the first few days. I suspected that it had to do with the fact that I didn’t have all my financial information back due to the weekend and my being out of town. It turns out I was right, but not in the way that I had suspected.
After emailing my financial information back in, I logged into my account to see if any new investors had added funds to my loan about 12 hours later. Surprisingly, the entire $15,000 loan had been funded just like that. I looked through the investors and found that one investor had funded the remaining $13,000+ down to the penny.
After some searching on the internet, I discovered that there are a few big institutional investors that have made investments through Prosper and one of them had funded the rest of my loan. So, 20 investors are likely individuals and 1 is an institution. That is OK with me since I needed the money.
The funds were then directly deposited into my checking account about 4 business days after the loan fully funded. Again, the process was easy. Now, the payments will be automatically deducted. In fact, the first payment is scheduled to go out tomorrow although I suspect it may end up being Monday since tomorrow is the weekend.
I am a Prosper Affiliate
The process was so easy and worked well for me. So, I decided to become a Prosper affiliate. If you are interested in getting a loan or want to invest your money with them, simply click on the banner in the upper right hand corner of this blog. I know some of my readers invested in my loan and for that I am incredibly grateful.
The interest rate is a little over 18% so it will be a good investment for them. I plan on paying it off as early as possible based upon the other interest rates that I am paying, but I won’t get to it right away. I do still have some other obligations such as the Discover Card first.
Ultimately, I do hope to make a little affiliate income with Prosper. I will be using it for debt pay down like I am doing with all of my blog earnings.
Readers: Have you borrowed or lent through P2P lending? Share your experiences.