Tax Refund Time 3

The April 15 tax deadline has passed and many are celebrating the hefty tax refunds they were “given” by treating themselves to vacations, ipads, motorcycles, and other expensive purchases with their hard-earned withheld cash, not realizing that they were entitled to these funds all along. As a finance geek, I would urge readers to use their tax refunds to pay off debt, plunk down as an extra mortgage payment, drop into a Roth IRA, or maybe a 529 savings plan for their youngsters.


This year was the first year that I received a substantial tax refund (around $1,500). I usually strive for a break-even result rather than provide an interest free loan to Uncle Sam. However, this year included extra write-offs including investment losses and sales tax deductions from my car purchase.


My plan of attack for these funds doesn’t involve motorcycles, boats, ATV’s or Caribbean cruises. Rather, I’m using the proceeds to start my Lending Club investment account. For those of you unfamiliar with lending club and peer to peer lending, it basically attempts to cut out the middle men of consumer lending (banks) and allow everyday Joe Blows to get a piece of the investing action by investing or loaning money to qualified borrowers in increments as small as $25. The lenders have a wide field of data they can sort by in choosing individual $25 notes, or allow Lending Club to create a portfolio based upon certain criteria. The potential yield is larger for those clients perceived as high-risk, while obviously lower for those with firmer financial footing and history.


I made a goal to improve my interest earned on my funds currently plunked into a savings account earning zilch. Initiating the Lending Club account is a good start to achieving this goal and I’m eager to dip my toe into the P2P Lending world after reading rave reviews from some of my favorite finance bloggers, Mr. Money Mustache and Mr. 1500.


What are your plans for your tax refund?

3 thoughts on “Tax Refund Time

  1. Reply Mr. 1500 Apr 24, 2013 7:13 pm

    Nice, Lending Club is awesome. This month marks my 3 year anniversary with Lending Club and I’ve never earned under 10%. They are doing 100,000,000 in loans per month now. I really believe this is the future of lending. Screw you banks.

  2. Reply Chad Apr 30, 2013 1:37 pm

    Great use of your tax refund. I would love to use Lending Club, but only the secondary market is available to Texas. I’d love to invest with them once they’re available in Texas.

    • Reply Net Worth Snowballa May 12, 2013 7:58 pm

      Thanks Chad. Oh that’s a bummer, that you can’t partake in the Lending Club party. Sorry I missed your post until now amongst a flood of spam. It seems that with the growing popularity and huge funding coming into Lending Club and Google’s recent investment in LC that it’s only a matter of time before it’s available everywhere.

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