Cruisers Forum
 


Join CruisersForum Today

Reply
 
Thread Tools Rate Thread Display Modes
Old 24-12-2009, 07:35   #1
Registered User

Join Date: Dec 2009
Location: Southern California
Boat: Irwin 43
Posts: 37
Images: 3
Cruising Kitty - Social Lending

We are planning on leaving next October for a few years on the water. We are looking for good places to keep our funds while cruising. Of course we want to maximize our income while minimizing risks. Presently I am testing social lending at the lending club where returns seem to be in the 10% range. Are there any other ideas for the kitty?
__________________

__________________
TugTubPaul is offline   Reply With Quote
Old 24-12-2009, 07:52   #2
Long Range Cruiser
 
MarkJ's Avatar

Cruisers Forum Supporter

Join Date: Dec 2007
Location: Australian living on "Sea Life" currently in England.
Boat: Beneteau 393 "Sea Life"
Posts: 12,828
Images: 25
Avoid it at all costs - those costs being your own wallet.



.
__________________

__________________
Notes on a Circumnavigation.
OurLifeAtSea.com

Somalia Pirates and our Convoy
MarkJ is offline   Reply With Quote
Old 24-12-2009, 11:24   #3
Registered User

Join Date: Aug 2008
Boat: Trident marine Voyager 30
Posts: 99
10% returns means it is risky.
I suggest that you ask your question at
Bogleheads :: Index
__________________
Anders is online now   Reply With Quote
Old 24-12-2009, 11:25   #4
Moderator Emeritus
 
David M's Avatar

Cruisers Forum Supporter

Join Date: Sep 2007
Location: San Francisco Bay
Boat: research vessel
Posts: 10,152
10%? You might want to re-evaluate the risk. That kind of return is usually accompanied with a higher risk than the more guaranteed financial instruments.

What guarantees are there that these people have not already spent your money? Bernie Madehoff's returns looked good at one time as well.

The big question is, do these people get audited by a credible auditing firm? Just because these people seem grass roots does not mean they can be trusted. You need some sort of objective measure before you do that.
__________________
David

Life begins where land ends.
David M is offline   Reply With Quote
Old 24-12-2009, 11:39   #5
Senior Cruiser
 
idpnd's Avatar

Cruisers Forum Supporter

Join Date: Sep 2007
Location: Almería, ES
Boat: Chiquita 46 - Libertalia
Posts: 1,551
P2P lending is fine apparently, they use the same credit rating procedures banks do, whilst cutting out said middleman's margin. Result: Higher interest for lenders, lower interest for borrowers.
__________________
sv Libertalia
idpnd is offline   Reply With Quote
Old 24-12-2009, 11:59   #6
Moderator Emeritus
 
David M's Avatar

Cruisers Forum Supporter

Join Date: Sep 2007
Location: San Francisco Bay
Boat: research vessel
Posts: 10,152
A ten percent return means that the borrowers are paying greater than a 10% interest rate. I would still be very cautious and not just assume they are legitimate before thoroughly investigating them. What APR do the borrowers pay by the way? That's a good question to find out.
__________________
David

Life begins where land ends.
David M is offline   Reply With Quote
Old 24-12-2009, 12:34   #7
Registered User

Join Date: Nov 2004
Location: Currently based near Jacksonville FL; WHOOSH's homeport is St. Pete, FL USA
Boat: WHOOSH, Pearson 424 Ketch
Posts: 591
Paul, two thoughts for you:
-- put the funds you need for cruising during this period into an insured, liquid form and you will be buying 'cruising insurance'; one of the saddest sights we've seen were all the crews out cruising, having a ball, who had to return home after the 2000 web commerce meltdown occurred and then when 9/11 hit. They too wanted to 'keep their money working' but the alternative is to keep your cruising funds available to you, insulated from life's unfolding events
-- presumably given the duration of your cruising period, you will be in foreign waters; depending on where that is, you can consider converting USD funds into the currency(ies) you will need. A friend encouraged us, on arrival in Europe, to do this by shifting USD's to Euros; we wish we'd followed his advice for the next four years

Jack
__________________
WHOOSH, Pearson 424 Ketch
http://www.svsarah.com/Whoosh/WhooshSection.htm
Euro Cruiser is offline   Reply With Quote
Old 24-12-2009, 14:16   #8
CF Adviser
 
Intentional Drifter's Avatar

Cruisers Forum Supporter

Join Date: Apr 2006
Location: Pac NW
Boat: Boatless, for now, Cat enthusiast
Posts: 1,283
When prime is 3.25, mortgage rates around 5, what sort of person would be paying 11+?

Risky ones, that's who.

Such an investment might be a reasonable consideration for a small part of your portfolio that you dedicate to high risk/high return, with the understanding that it could disappear, and you can deal with the loss.

ID
__________________
Intentional Drifter

Observations are gold; hypotheses, silver; and conclusions, bronze.

Democracy is two wolves and a lamb voting on what to have for lunch. Liberty is a well-armed lamb contesting the vote.--Ben Franklin

Everyone is entitled to their own opinion, but not their own facts.--Daniel Patrick Moynihan
Intentional Drifter is offline   Reply With Quote
Old 24-12-2009, 16:36   #9
Registered User
 
Tempest245's Avatar

Join Date: May 2008
Location: Piscataway, NJ
Boat: 34 Sabre Tempest
Posts: 937
IF it sounds too good to be true....it Probably is..

Also, what do you mean by " Testing" ..you've already invested some funds to see if the returns are real???

Their own prospectus states: (paraphrasing).... " These investments are highly speculative and as such bear a very high risk, any noteholder should be prepared to lose their entire investment."

Caveat Emptor!!

Besides sticking my money in a mattress right now, I might consider
Short or Intermediate Bond funds, Tax free municiples, CD laddering, Whole market index funds, Gold....Or, you can create your own portfolio of dividend paying stocks and untilities.....
__________________
Tempest
Tempest245 is offline   Reply With Quote
Old 24-12-2009, 16:40   #10
Senior Cruiser
 
idpnd's Avatar

Cruisers Forum Supporter

Join Date: Sep 2007
Location: Almería, ES
Boat: Chiquita 46 - Libertalia
Posts: 1,551
They do publish the default rates, obviously the higher rate of interest applies to higher risk groups. Generally the defaults are enforced by an external agency just like any bank loan.
__________________
sv Libertalia
idpnd is offline   Reply With Quote
Old 24-12-2009, 18:10   #11
Registered User

Join Date: Dec 2009
Location: Southern California
Boat: Irwin 43
Posts: 37
Images: 3
Thanks for all the input.
__________________
TugTubPaul is offline   Reply With Quote
Old 24-12-2009, 18:12   #12
Registered User

Join Date: Dec 2009
Location: Southern California
Boat: Irwin 43
Posts: 37
Images: 3
Tempest,
Yes, i did put some money in lending club loans. The concept seems to be loan a little bit of money to a lot of people. Its been about a year and the default rates are about what they claim.
__________________
TugTubPaul is offline   Reply With Quote
Old 25-12-2009, 09:06   #13
Registered User
 
Reality Check's Avatar

Join Date: Jun 2007
Location: West Indies, Now live aboard as cruiser/ voyager often with guest/ friends
Boat: 36' Bene
Posts: 585
Send a message via ICQ to Reality Check
The profile of most Multi Level investments and high return rates of securities for Scam artist is to use new money from investors to pay back some small investors to entice them to become bigger investors.

Looks like a offer you can refuse.
__________________
I prefer a sailboat to a motorboat, and it is my belief that boat sailing is a finer, more difficult, and sturdier art than running a motor.
--- Jack London
Reality Check is offline   Reply With Quote
Old 26-12-2009, 08:19   #14
Senior Cruiser
 
osirissail's Avatar

Cruisers Forum Supporter

Join Date: Feb 2009
Location: A real life Zombie from FL
Boat: Gulfstar 53 - Osiris
Posts: 5,416
Images: 2
Let's see, Madorf, and a host of other pyramid schemes and you can see where these "too good to be true" investments end up. Not even the "biggest of brothers" regulatory agencies can spot such schemes until the investors have lost everything.
- - The advice to separate out your "money needed for cruising" from any excess money is very good. Put it in good Certificates of Deposit timed to be available periodically as you need more cash to continue cruising.
- - The excess money can be put in more speculative investments where you can hope to make "a bundle" and at the same time realize that it can also "evaporate" overnight. Its the "nothing ventured, nothing gained" philosophy.
- - Subject to your nationality, off-shore investments and converting to other currencies than dollars, can get significantly larger rates of interest and at the same time insulate against dollar variations - if done correctly. Lots of little and other countries are paying 10% on savings in their own currencies. There is some mathematics involved in determining asset conservation across different world currencies. Bottom line, you can work for a wage and try to save it as best as possible or make your money work for you which requires some savvy and hard mental labor on your part versus sweat labor.
- - The temptation to "get rich quick" is universal and the bread and butter of the scam artists. If they are offering 2X, 3X, 10X the local economy's normal return - you just may be really walking into the jaws of the shark.
__________________
osirissail is offline   Reply With Quote
Old 26-12-2009, 09:29   #15
Captain
 
Andy R's Avatar

Cruisers Forum Supporter

Join Date: Nov 2005
Location: Forianopolis, Brasil
Posts: 1,574
Send a message via MSN to Andy R Send a message via Skype™ to Andy R
One of Cruisers Forum's sister sites is www.Early-Retirement.org. That's an excellent site where many members have the same issue. The founder of Early-Retirement (Dory 36) often moors in the intercostal and many of the other members are either sailing or out and about in their RVs.

To answer your question, we would need more information like your expected cost of living, total funds available to live off of (or a percentage there of), etc. If you need 10% to break even then that's one thing. If you need 3% then you have many more options.
__________________

__________________
Andy R is offline   Reply With Quote
Reply

Thread Tools
Display Modes Rate This Thread
Rate This Thread:

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
New Texas Social Group Ocean Girl General Sailing Forum 33 30-09-2013 21:06
Crew / Yacht kitty donors - Lively Expatriate Type extreme guide Crew Archives 0 07-05-2009 19:20
Investment/Retirement/Cruising Kitty bottleinamessage Dollars & Cents 32 20-12-2008 22:43
New Social Group - Racing! Ex-Calif General Sailing Forum 0 13-10-2008 01:21



Copyright 2002- Social Knowledge, LLC All Rights Reserved.

All times are GMT -7. The time now is 12:52.


Google+
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.
Social Knowledge Networks
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.

ShowCase vBulletin Plugins by Drive Thru Online, Inc.