Ooookay, I put a chunk of money into LendingClub, and here's what I learned: - Remember that the money that you make on this is taxed as income, which stinks f

Ooookay, I put a chunk of money into LendingClub, and here's what I learned: - Remember that the money that you make on this is taxed as income, which stinks for high income individuals - The alternative is to set up a lendingclub IRA and put money in there, but now you're somewhat limited as to how much you can invest, as well as being ineligible if you've got an employer retirement vehicle like a 401k - The return is very high at the beginning, and then tends to drop as more and more people default (or pay off early, which can be almost as bad from an investment perspective) - It takes work - it's interesting if you have the time and inclination to pick out the notes you want, or they have an automated system - I did a bit of both In the end, I'm making about 6.5% a year on it - not terrible, but at tax time every year it sucks when I'm getting charged state and federal income taxes on that 6.5%. I think it makes a lot of sense for folks who are not concerned about reducing their taxable income and want a more active investment option than just vanguard ETFs, or who want an IRA option with higher returns. But it's not as awesome as it seems at first glance.