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As I mentioned on a previous post on the Lending Club blog, regular review of your credit report is critical because your credit report data will affect your applications for mortgages, car financing, credit lines, and p2p loans on Lending Club. When reviewing your report, it's important to keep the following in mind:

You Actually Have Three Credit Reports
Many people make the mistake of thinking that each of the three major credit reporting agencies, Experian, TransUnion and Equifax, all contain identical records. While their records do generally contain much of the same information, it's important to thoroughly check all three reports, since there are often some discrepancies. By ensuring accurate information is contained in all of the reports, you maximize your credit score potential.

Fixing One Report Doesn't Fix Them All
When you do find errors in your credit report, remember to have that information corrected in every report that contains the error. Too many people think that by fixing it in one place, corrected information will eventually make its way to all three.

Paying Off Bad Items Doesn't Remove Them From Your Report
While the three credit reporting companies are all generally helpful in correcting inaccurate information, they won't remove true information from your report. So if your report contains an account with late payment history, or a similar negative characteristic, paying off or closing the account may bring it back into good standing, but it won't remove it from your report. According to The Truth About Credit Cards' website paid/closed accounts will remain on your credit report for 10 years after they are closed.

It's important to take all of these points into account when monitoring your credit report, but they're just a starting point. You need to be active in staying on top of your credit. Review your report at least once a year and be sure to correct any errors in all places where they occur. Only through your continual review and action will you earn all of the credit that you deserve.

As a regular contributor to the Lending Club blog, I read a lot of other financial columns and websites looking for stories to cover. As a result, many topics, outside of Lending Club’s core competence of providing P2P loans, are covered. Over at Investor Guide, I recently came across a list of questions to ask yourself to see if the time has come for a financial checkup.

The idea is that just like our bodies (or our cars) need routine maintenance, so too may our finances. Depending on your answers, you may want to consider talking to a qualified professional such as a financial planner. Here are the questions:

• Do you have financial goals? If so, are they in writing and do they include deadlines?

• Is your debt under control? Do you pay off your credit cards each month?

• Have you reviewed your investment portfolio recently? Are you comfortable with the level of risk associated with your current investments?

• Are you satisfied with the rate of return that your investments are generating?

• Have you started a retirement fund yet? If so, will your current rate of savings provide an adequate fund to meet your future retirement needs?

• Have you reviewed your tax situation recently to see if there are ways to reduce your tax liability?

• Have you started a savings program to meet the cost requirements of your children's college education? If so, will your current savings rate be adequate given the effects of inflation and rising tuition costs?

• Have you reviewed your life insurance coverage recently? In the event of an untimely death, will your current policies provide adequately for your spouse and/or children?

How did those questions make you feel? If you felt a little uncomfortable thinking about one or more of them, then you may want to discuss your finances with someone.

The Internet also provides a lot of useful financial information. If you do turn to the Internet for advice and strategies, consider reviewing those ideas with a professional before taking action. With the diversity of readers out there, it’s unlikely that any one piece of advice on the Internet will fit your situation perfectly. Even though you might self-diagnose yourself based on medical information you found on the Internet, you would clearly be better off by consulting with your doctor. The same is often true with your finances.

Depending on which of these questions caused the most concerns, you may want to meet with a tax advisor, insurance agent, investment broker, and/or financial planner.

Do you need any proof that today is the day you should invest? I have an article for you that might just inspire you to invest today.

The Motley Fool wrote an article about how the first million is the toughest. Because of the miracle of compound interest, the time it takes to get your first million can be over 5 times as long as going from $1 million to $2 million. Why? Well, compound interest works by gaining interest off your previous returns. This means that, if your money takes 7 years to double, going from a monthly investment of $500 will take a little under 30 years, while going from $1 million to $2 million will take less than 7. The earlier you start, the earlier your money will hit that magic $1 million mark.

Honestly, if this knowledge doesn't get you motivated, nothing will. The day you start investing is the day that your chances of being wealthy skyrocket. You need to have money in the bank in order to make money. Warren Buffett likes to invest in solid companies that will produce good long-term results. Warren Buffett is the world's third richest man, so I think he knows what he is talking about.

As you accumulate more and more money, your returns become almost exponential. The money you invest becomes an interest generator.

Invest today, whether in stocks, bonds, mutual funds or P2P loans on Lending Club. Your future self will thank you.

We all know that the cost of college is going up, but it seems like everything is more expensive then it used to be. A recent report shows that college costs are rising faster then the costs of other goods and services.

The data for this post comes from the College Board’s report Trends in College Pricing 2007

Here are some of the increases in average tuition and fees reported:

• Two-Year Public Colleges up 4.2% ($95) from a year ago

• Four-Year Public Universities up 6.6% ($381) from a year ago

• Four-Year Public Universities up 6.3% ($1,404) from a year ago

The US Bureau of Labor Statistic’s inflation calculator shows inflation at around 3.4% for the same period. Many students do benefit from financial aid and grants which reduce the actual cost paid, but even that cost is increasing at similar rates.

Net costs for tuition and fees increased as follows:

• Two-Year Public Colleges up 6.7% ($20) from a year ago

• Four-Year Public Universities up 6.6% ($160) from a year ago

• Four-Year Public Universities up 4.6% ($630) from a year ago

With costs rising faster than inflation, the relative cost of college is going up. College savings plans, financial aid, and government loans may not be enough if you don’t start planning early. If you do have some time before your college expenses will begin, I highly recommend looking into a 529 College Savings Plan. If you have a more immediate need, then a P2P loan from Lending Club may be a more cost-effective solution than looking to the private sector for a student loan.

With Google shooting through the $600 per-share price, ads on the radio promoting getting rich by investing online, and friends who whisper about others who hit the online investing jackpot, it’s no wonder that many people have started investing online.

For many people, online investing has provided them with more control and access to tools that were not previously available. But to others it has proven to be a stumbling block.

Research done by Barber and Odean in 20021 says that many investors do much worse when they invest online compared to offline investing approaches. According to the US SEC there are over 10,000 stocks available for trading and thousands more of mutual funds, making decisions difficult.

Looney and Associates (2006)2 researched how technology and investing are related. They found two things:

1) Your understanding of the Internet and related technologies can give you a biased understanding of investing. When you’re feeling in control because you know how to use the Internet, you might also feel overconfident about your investing capabilities.

TIP: Don’t confuse being confident using the Internet with being confident with your investing skills. They are separate, with investing requiring discipline and homework.

2) The availability of advanced tools and information might give you the feeling of being more in control of your investments. This might be even promoted by brokerages and other companies with statements like “You’re In Control.” Add to that the mountains of information and analysis available to investors that can lead to distorted views and expectations.

TIP: Use real world expectations about the homework that you have to do before investing and with respect to the results that you will receive from those investments.

Next time you hear about the hot stock tip or another revolutionary investing system, remember that investing requires real work and homework to be done in order for you to be successful. Also be sure that you are diversified in your investments, using such instruments as stocks, bonds, mutual funds, and P2P loan portfolios on Lending Club.

1 Barber,B.M.,& Odean,T.(2002).Online investors: Do the slow die first? Review
of Financial Studies, 15(2),455-487

2 Looney, C. A., Valacich, J. S., Todd, P. A., & Morris, M. G. (2006). Paradoxes of Online Investing: Testing the Influence of Technology on User Expectancies. Decision Sciences. 37(2), 205-246.