To help you make sense of what’s happening, we've compiled the following list of resources that offer good explanations for the crisis. After reading them, you should be better able to understand our current economic situation than before.

1) The Visual Guide to the Financial Crisis

This guide offers a flowchart that shows the causes and effects of each part of the crisis. Also, the chart is pretty!

2) Understanding the financial crisis for non-finance majors

Mohamed Nanabhay gives a list of links that helped him understand the reasons for the financial crisis. Some of his links are excellent, including:

3) The Giant Pool of Money

The Giant Pool of Money is a radio show produced by NPR and This American Life. During the hour-long radio show, you will learn all about the origins of the crisis, such as why the housing market affects Wall Street, and why banks made half-million dollar loans to people without any income.

4) Can’t Grasp the Credit Crisis? Join the Club

The New York Times manages to both educate you and insult your intelligence with this article. The writer shows how rare any sort of understanding of the crisis is and gives a short explanation of what happened.

5) Understanding the Financial Crisis

Written by PhD Stephen Rose, this academic article offers an in-depth explanation of the causes and results of the current economic situation. It also explains how the failure of the markets was accompanied by the altruistic desire to help first-time homebuyers.

6) Obstinate Observations - Understanding the Financial Crisis

This three-part series delves deep by identifying the roots of the crisis as well as potential methods of solving it. There is a lot of valuable information in the three parts of this article.

7) Understanding The Financial Crisis--For Kids and Grownups

This family-oriented video helps explain the roots and causes of the economic crisis. It doesn't go too deep into its explanation (it's only 4 minutes long) but it's definitely interesting to watch.

We hope that these resources will give you a deeper understanding of the factors behind the current situation and various possible solutions to the crisis.

Have you found any other helpful resources you’d like to share?

© 2009 Lending Club. All rights reserved.

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There are three major financial differences when you work through the first year of your planned retirement. First, your job (and not your nest egg) will cover your expenses. Second, you can make additional contributions to your portfolio. Third, your money will have to last one year less, assuming your lifespan is the same in either case.

Reviewing the assumptions from the previous post, consider a retirement portfolio worth $1,250,000, expenses of $50,000, 30% of the portfolio in equities, and a decline in portfolio value of 16.5%.

By working through the first year, $50,000 won’t need to be withdrawn from the portfolio for expenses. You would also be permitted to contribute an additional $20,500 to your portfolio, assuming that you were using a 401(K) and at least 50 years old. Even if you received no employer matching, your portfolio would be worth $1,064,250 at the end of the year. To get that number I reduced your starting portfolio (of $1,250,000) by 16.5% and added your $20,500 contribution. The actual number would be slightly different since contributions would be made throughout the year and may also be subject to market forces.

Plugging those numbers into the FIRECalc, we raised the success rate from 44.4% to 51.9%. Is working an extra year worth raising the probability of your money lasting through retirement by 7.5%? Also remember that this extra year worked was assumed to occur during an extraordinarily bad year for the stock market. Working one extra year during flat or positive gains of the market could have an even greater effect.

Would you consider working an extra year to significantly increase the likelihood of having enough money to last your entire retirement?

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• Reinvesting Monthly Payments: until now, it took some efforts to keep your money invested. We have made it a lot easier by offering the ability to schedule a search that runs automatically when your cash balance equals or exceeds a given amount. This feature currently uses LendingMatch; we will be adding the ability to use the more granular credit criteria soon. To find this feature, log into your lender account and go to Invest > Reinvest
• Notes Already Invested in: many of you have asked for this feature in the last few months: you will now be able to see which series of notes you have already invested in and avoid investing a second time. You can also exclude them altogether when browsing and searching for notes to invest in, by selecting a check box at the top of the search page.
• Give your friends $50: you can now pass the word out to your friends and family and give them $50 to try Lending Club. Simply log into your lender account, click on the "Invite" tab, and fire up emails to your connections.
• Charged off loans and notes: we have added a “charged off” status to your account, so that you can now differentiate defaults from charge-offs. While “default” occurs automatically when a loan is 120 days past due, a loan or note only gets charged off when Lending Club considers it unrecoverable after a review of the collections activities (which can happen before or after 120 days). These charge-offs will appear in your end of year statement so that you can report them as losses for tax purposes.

Let us know how useful you find these new features, and feel free to tell us in the comments below which new features we should be working on.

Happy New Year!

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