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Most people who have loans are familiar with the term amortization. In its simplest form, it simply means the reduction of the loan balance through regularly scheduled payments. For a given loan balance, interest rate, and term, the full amortization amount is the principal payment that will reduce your loan to zero over the normal term of the loan. Once you know your full amortization amount, there are four typical categories that you could fall into, depending on your loan.

Full Amortization
Paying the full amortization amount will result in the outstanding balance of a loan being reduced to zero at the end of the loan term. This is the most typical type of loan available, including the person-to-person loans available through Lending Club.

Partial Amortization
By paying a portion of your amortization amount, you will be reducing your outstanding principal on the loan each month. Paying a partial amount will result in an outstanding balance at the end of the loan term.

Interest Only
As the name suggests, paying interest only would not include any amortization payments. At the end of the loan term, the principal would be the same as at the start of the term.

Negative Amortization
Negative amortization loans require even lower monthly payments than interest only loans. As such, monthly payments actually increase the outstanding principal on the loan. The shortfall of payments to the interest amount gets added to the loan amount each month.

To summarize the four categories, consider the example of borrowing $250,000 with a 30-year loan: With full amortization payments, your loan would be paid off at the end of 30 years. With partial amortization, you would owe some amount less than $250,000 at the end of 30 years. With Interest Only, You would still owe $250,000 at the end of 30 years. With negative amortization, you would owe more (possibly much more) than $250,000 at the end of 30 years.

While the discussions over the other types of loans are generally held with regard to mortgages, all loans can typically be categorized in this way. P2P loans from Lending Club are fully amortized. Adjustable rate loans complicate things somewhat, but these same categories generally still apply.

Many of the loans that have been making the news lately fall into the categories other than full amortization. While partial payment, interest only, and negative amortization loans typically have lower monthly payments, I believe that these loans should be avoided. Full amortization loans set a more realistic bound on the type of purchases you can truly afford.

My opinion is that there is only one time when you should stray from the full amortization category: prepaying your loan. Paying more than the full amortization amount, when permitted by your loan issuer, will shorten the term of your loan. Straying into the other loan types is risky business and an action that I would certainly try to avoid.

Saving money and building wealth is a great thing, but building a big account isn't the ultimate goal. The point of your money should be to use it, somehow. Saving for your retirement is important, and a lot of people also love to consume movies and clothes and jewelry and electronics. Still, some others dream of being producers---founders of businesses.

Saving money to start a business can be a very good idea---businesses can make you rich, or they can supplement income from your regular job, or they might just be a way to throw off the shackles of the Man. Either way, you will need some investment capital to start your own business.

There are a lot of ways to raise capital. You might be able to get venture funding from a venture capital firm, or you might have to ask your family to lend you some money. If you have a lot of extra money saved up, you might be able to fund your startup yourself. And you can also apply for a P2P loan on Lending Club to help get your business idea off the ground.

But how much does it cost to start up your own company? Answering that is a difficult question--it definitely depends on the type of company you are trying to start, the number of employees you will need, and several other factors. However, there are ways to get some solid numbers.

First of all, ask other entrepreneurs. Having other contacts in your chosen field of business is essential---other restaurateurs, for example, will be able to give you the best advice on building a restaurant, especially others from the same area. These contacts are the best bet to mentor you in your own development, and to give you full disclosure on all the problems you will have to deal with.

There are a lot of other resources you can check into, such as business consultants and trade associations. Among the best places to look are business start-up guides or trade articles.

Here are a few articles I've found that have a lot of advice about how much seed money you will need:

The top eight resources to total up the necessary startup costs for your business.

A list of some costs to take into account, plus links to online calculators and checklists.

Great article that discusses all the financial issues of a new business.

With all of the other newsworthy events happening each day in the world, you probably wouldn’t expect an article about credit card fees to be the lead story on a major news website. But that’s exactly what happened on the afternoon of Thursday, September 20th. MSNBC.com featured an article on credit card rates by Herb Weisbaum as the top news story of the day. The full article can be found here.

In the article, Mr. Weisbaum brings up many interesting facts about credit cards that warrant being recapped here:

• Despite its pledge to take on the credit card industry six months ago, Congress has yet to act to reduce or limit the high fees and penalty interest rates

• At a time when they should be reducing fees and rates, many card issuers are increasing late fees, cash advance fees, and default fees (see this GAO study for more information)

• Some cards have added a third tier to their fee structures. Instead of charging one late fee for balances below a certain amount and another for balances above that amount, by having three levels, higher fees can be charged with lower outstanding balances

• Even though the recent, and much publicized, half-point rate cut of the Federal Reserve will eventually find its way to consumers with variable rate credit cards, card issues tend to reduce rates more slowly than they raise rates

• The Federal Reserve rate cut will have little or no impact on penalty rates and fees

The rest of the article goes on to describe why credit card cash advances are such a bad idea for the consumer. Examples were given of a card that charges an interest rate over 28% for cash advances on its standard accounts. Taking money out at that rate was reported to cost $465 in interest and fees over the course of a year for an advance of $1,500.

While tapping into savings or applying for a Home Equity Line of Credit (HELOC) are both suggested as cash advance alternatives, another viable choice was not discussed: Lending Club P2P loans are a favorite choice of people in need of cash who wish to avoid the incredibly high interest and fees of credit card cash advances. With rates comparable to a HELOC, without the need to time up the equity in your home, Lending Club may be the best solution for your cash funding needs.

Mr. Weisbaum concluded his excellent article by urging consumers to write to their representatives in Congress and urge them to make changes to credit card regulation. The fees and interest charges common to the credit card industry have certainly gotten out of control.

Growing up in my family the issue of money was rarely, if ever discussed. My middle-class parents worked hard, but if they struggled with bills or money issues, they certainly never shared any of those struggles with me.

I really wish they had.

In school, I never learned a thing about a "credit score." If someone had asked me about "FICO," I would have thought they were talking about their dog. It wasn't until my junior year of college that I really began learning how the credit system in our country works. And it wasn't until this year, at age 24, that I finally created a budget!

I imagine that, like myself, the majority of Americans worry, fret, and have some level of concern about their financial situation. So...why don't we talk about it more? Sure, we read articles like this online, and subscribe to magazines like Money and Forbes...but do we ever talk to our neighbor about our sky high interest rates? Or a close friend?

Maybe. Maybe not.

If most of us are in the same boat (student loan debt, credit card debt), how come we don't talk about it more? Are we afraid of being judged? Of being labeled a debtor? A failure? Maybe we are afraid, but debt and our financial worries aren't going away anytime soon. So why not share the burden with your neighbor or co-worker? You might just find someone in the same situation as you.

What do you think?

Do we talk about money enough in our family, friend, and work relationships? Do we talk too much?

If you have excellent credit, you may not think that a P2P loan from Lending Club is necessary. You may feel confident that you can get approved for a loan at your bank. You may also think that Lending Club is only for people with no other alternatives who are forced into a non-traditional lending path. Many of these thoughts are wrong, or simply incomplete. Below are some

• Lending Club is Designed Specifically for People With Good to Excellent Credit

In order to qualify for a loan from Lending Club, you need a credit score of at least 640. Even then, some people with scores above 640 are turned down if their Debt-to-Income ratio is too high. Lending Club is committed to maintaining a high standard of creditworthiness among its borrowers. This isn’t a website for sub-prime lending. It’s a site for saving money for people with good credit who want to cut out the middleman and bypass the bank.

• Lending Club Saves Money for People with Excellent Credit

While most would agree that rate comparisons show Lending Club as an inexpensive way to borrow money, some people may think that those comparisons aren’t valid for their particular situation. They may incorrectly assume that Lending Club loans aren’t competitive for people with excellent credit. That assumption is quickly corrected if you consider the rate comparison found on the Lending Club homepage, which cites data from creditcards.com for people with excellent credit.

These rates were shown on September 18th as follows:

And don’t even get me started on personal loans from banks, which are extremely expensive. For example, look at some of the latest rates for loans in Arizona that are listed on bankrate.com. As all of this data shows, Lending Club is clearly the best option listed. The source of your money isn’t what matters; it’s the interest rate that determines how much you’ll save.

• P2P Lending Isn’t Non-Traditional, It’s Just New

Just because P2P lending hasn’t been around for a long time, you shouldn’t think that these loans are non-traditional. Obviously, there were loans long before banks came into being. If anything, P2P lending is restoring the way people used to lend for thousands of years.

This type of lending is gaining significant momentum as more and more people, many of whom are fed up with the higher rates and fees of banks, discover how much they can save. I believe that the increased efficiency of P2P lending makes it a superior method of lending money. As with other new concepts, however, it can take time for people to see the advantages of and be compelled to try a new way of lending or borrowing money. Saving money is an excellent motivator, which has surely been a factor in the million dollars’ worth of loans issued in Lending Club’s first 100 days alone!

Everyone who is approved for a P2P loan on Lending Club stands to save money compared to his or her more expensive alternatives. Having excellent credit doesn’t exclude you from these savings; it likely qualifies you for them. The only way to know for sure how much Lending Club can save you is to submit an application. Like every aspect of the Lending Club experience, the application is simple to fill out and doesn’t take much time. Your journey to cashing in on your excellent credit may only be moments away.