Saturday, March 8, 2014

February / March investing update

This has been a great month for my investments. I didn't really notice until now though. It's nice having your finances on autopilot. You reap the benefits of continuously investing, and you can spend your time on other pursuits. It's also pretty crazy how many gains (or losses) the market can yield. The fluctuations are just numbers on paper, but they're fun to keep track of nonetheless.

Here are my current standings, and the differences from my last update in late January:

  • Vanguard IRA - $28,677.65 ($1,662.44)
  • 401k - $1,700.60 ($1,048.69)
  • Lending Club - $2,090.23 (-$147.93)
  • Schwab - $7,830.88 ($513.92)
  • I-bonds - $2,006.48 ($402.64)
  • Total - $42,305.84 ($3,479.76)
I think it's crazy how much my IRA with Vanguard has fluctuated. It has increased in value about 6% from my last update. That 6% increase is pretty big in less than two months. What's even crazier is how 6% can be such a big absolute gain of over $1600. This is what it looks like when your wealth snowball starts rolling downhill.

For my new 401k I'm 100% in the "Columbia Dividend Income Fund". It seemed reasonable in terms of expenses (for a 401k). This means that all of my retirement wealth is in dividend stocks. I'm happy with this for now, and probably will be for the next decade or two. I don't really trust stocks that don't pay dividends, and I'm far enough away from retirement that I'm not concerned about my lack of diversification. Actually, I think a broad basket of companies paying dividends is pretty diversified, but that's another story.

It feels good having a stream of pre-tax income being dollar cost averaged into some investments, without me having to think about it. It feels even better that some of that is essentially free money being matched by my employer, just because I'm doing my own saving. Employer matching 401k contributions are a wonderful thing.

I continue to wind down my positions with Lending Club. I have decided that the best investments for me are the simplest to manage, and that I plan on holding most of my wealth in dividend stocks that I research myself and then hold for long periods of time. I have three notes that are past due, two of which are still in their grace period and one which is 16-30 days late. At my last update, I had two late notes, both of which became current again. I still haven't had any loans default, so I think I'm overdue. I've made enough interest that I'll need a handful of notes to default before I'm in the negative. All in all I'm pretty happy with my Lending Club investments.

My I-bonds are really starting to compound! More than two dollars in two months? Big money big money.

I'm kidding of course. They're increasing in nominal terms, but they're keeping pace with inflation. I do really enjoy watching the interest trickle in month after month though. Come April I'll have my first I-bond that I'm able to redeem.

My Schwab taxable investment account is showing over $500 in completely paper gains, probably because Corning has been doing well again. My cost basis is $13.76 per share, and Corning is hanging out in the mid-$19s. I love the positions I have in that account (GLW and IBM). IBM is also up from where I bought it, after dropping into the $170s. I still really like their prospects for the next few years, though the share price is getting to the point that I'm not sure I would buy in today.

Before tax day (April 15th) I'm planning on fully funding my Roth IRA for the first time ever. I am planning on buying shares of Realty Income Corporation (O). I've had my eye on it for a while. It's a high-quality REIT that pays dividends monthly. Since it is a REIT, its payouts are taxed as regular income, so it's more tax-efficient to hold REITs in retirement accounts.


  1. It is nice to see the update. I am a few years behind you money wise and I am waiting until my snowball starts to gain some steam. I agree that employer matching on the 401k is great - it is borderline magical!
    I am just getting my toes wet with Lending Club. I only have 15 notes - I would slowly like to make my way up to 100. Have you looked into Prime? I think it may automatically invest for you. (Although there is a 5k minimum if I remember right).

    1. Hang in there. Surely enough the financial seeds I planted months and years ago are beginning to grow. Yours will too.

      I looked into Prime a few months ago. I don't have $5k with Lending Club and there was something about it that I wasn't fond of. Maybe it costs more money? I forget. Good luck growing your snowball with Lending Club though! The monthly compounding is really great, if you have the time to commit.