I’m a bit late with this update, but I wanted to get it out there because I’m closing in on one year of lending money through Lending Club and will be doing a big, year-end post sometime soon. As April came to a close, my “net annualized return” (NAR) was 10.65% — not too shabby.
However, this calculation doesn’t take into account uninvested cash, nor does it take into account activity on the FOLIOfn trading platform. While I try to keep my money as active as possible, there’s always a bit of cash kicking around in my account. Also, as I’ve noted previously, I’ve sold a couple of troubled notes at a loss to reduce risk.
So how are my Lending Club investments really doing? To answer that question, I fired up Quicken and ran a quick report. I’ve previously talked about how to track Lending Club investments and account for defaults in Quicken. It’s very easy, and gives you a much more realistic picture of your investment performance.
Anyhoo… According to Quicken, my Lending Club investments have an average annual return of 8.90%. This includes defaults, idle cash, and the handful of notes that I’ve sold at a loss. Not quite as high as the NAR reported by Lending Club, but it’s certainly nothing to sneeze at.