Making My Investment Dollars Stretch! What Do You Think?

[bawaboy]

Been doing this for a while with amazing success and wanted to share with the group and get feedback..........

I am an avid P2P investor with Prosper and also an avid Ebay seller. A few months back, I decided to combine the two and see what I could do with it.

My budget allows for about $500/month in funds to invest with Prosper but I decided to take a different approach with that money. Being an Ebay Powerseller, I decided to invest that $500 each month into the products that I sell. I sell sports memorabilia and make on average about 35-40% after Ebay/Paypal/Shipping expenses. So basically, I am taking that $500 and turning it into $675-700 to invest into Prosper each month. Doing this puts me more at ease with the potential risks of Prosper as I have already made a nice profit on that money before even investing it.

I have done this for 4 months now and am moving the inventory on Ebay so there are no hangups with stagnant products. I also dont know where I can go and make that kind of return so quickly and then invest it into something for the long haul.

I have tried to shoot holes in this process but it seems to be working well. Please feel free to let me know what you think or if you can think of a better way to expand it. Thanks!

[arebelspy]

Reinvesting into your business is a good idea.

Thinking that it has to go into Prosper, or that that's the only place where you can go to "invest it into something for the long haul" is a big mistake.

I'd suggest you read this, and start investing in index funds: http://jlcollinsnh.com/stock-series

But if P2P lending is what lights you up, knock yourself out.

(Also, why not reinvest that $700 into the business, and grow that, and repeat?)

[Beaker]

I sell sports memorabilia and make on average about 35-40% after Ebay/Paypal/Shipping expenses.

That's a good return. Are you going to make anywhere near that on Prosper? As long as you can get those returns and have the time to run the business, I'd keep reinvesting into that business.

[FrugalSpendthrift]

My budget allows for about $500/month in funds to invest with Prosper but I decided to take a different approach with that money. Being an Ebay Powerseller, I decided to invest that $500 each month into the products that I sell. I sell sports memorabilia and make on average about 35-40% after Ebay/Paypal/Shipping expenses. So basically, I am taking that $500 and turning it into $675-700 to invest into Prosper each month. Doing this puts me more at ease with the potential risks of Prosper as I have already made a nice profit on that money before even investing it.

That's interesting that it puts you more at ease with a potential risk, because you are actually risking even more money.  What rate are you earning on prosper and what percentage of your prosper lending is late or defaulting?

[arebelspy]

That's interesting that it puts you more at ease with a potential risk, because you are actually risking even more money.  What rate are you earning on prosper and what percentage of your prosper lending is late or defaulting?

More important - to me - what are their overall numbers and what happens when Prosper goes under and someone else has to be paid to service the loans?

[bawaboy]

Reinvesting into your business is a good idea.

Thinking that it has to go into Prosper, or that that's the only place where you can go to "invest it into something for the long haul" is a big mistake.

I'd suggest you read this, and start investing in index funds: http://jlcollinsnh.com/stock-series

But if P2P lending is what lights you up, knock yourself out.

(Also, why not reinvest that $700 into the business, and grow that, and repeat?)

Great article - thanks for sharing. I am at a point with eBay that it is either going to be a business or a hobby. Haven't decided yet. I also just mentioned Prosper as I think it's a great way to get decent returns - I have been in the 10-12% return range with them. I agree, diversity is best and Vanguard is a good choice.

Thanks to everyone for the great feedback. I really appreciate it.