We decided to ring in the New Year the best way we know: releasing a few features I trust you'll find useful:

• 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!

Every retirement planner will tell you that the market will have its ups and downs. What they probably won’t tell you is that if one of those downs comes right near your retirement, it could drastically affect your retirement plans.

Although the stock market is down significantly over the past year (Dow -39%, S&P 500 -45%, Nasdaq -47%) few retirees should have seen such a dramatic drop. By the time they approach or reach retirement, most people have shifted to portfolios heavier on bonds and other fixed income assets and lighter on equities. Still, a retirement portfolio that’s down 16.5% this year is probably a common scenario, particularly for those who recently retired. I arrived at 16.5% by assuming the portfolio had 70% in fixed income assets that retained their value, and 30% in equities that declined by 45%.

To understand the effect of a 16.5% reduction in your retirement portfolio at the start of retirement, I turned to the FIRECalc, which calculates the likelihood that your money will last for the rest of your life. I started with a retirement portfolio worth $1,250,000, assumed annual expenses of $50,000 (it is generally considered “safe” to withdraw 4% of your portfolio per year and 4% of $1,250,000 is $50,000), estimated 30 years left of life, and entered that 30% of the portfolio was in stocks.

The result? FIRECalc looked at the 107 possible 30-year periods of available historical data, starting with a portfolio of $1,250,000 and taking out $50,000 the first year of retirement, and the same amount after adjustments for inflation each year thereafter. With such parameters there was an 86.0% success rate. This means that in 86% of the periods evaluated, the portfolio would have survived 30 years.

Next, I adjusted the starting balance to $1,002,000. This is the $1,250,000 is started with, minus $50,000 in expenses for the first year, and a decline of 16.5% per our rationale above. I then estimated the success rate of the money lasting 29 years, since the first year of retirement had already been accounted for. The new result? The success rate dropped to 44.4%. One down year at the start of retirement meant that I was significantly more likely to run out of money.

You might argue that in such a scenario I should have adjusted the annual expenses by the declined amount as well to maintain the “safe” 4% withdrawal amount, but that reinforces my point. A large early decline in your portfolio may mean that you have to change your plan for retirement. To avoid this, it’s better to save more or plan to withdraw a smaller percentage. In that case, you’ll be more likely to survive if things go bad and come out much further ahead if they do not.

Have changes in your retirement portfolio forced you to adjust your retirement plans?

Everyone is worried about the economic collapse, about the failing banks and the dropping stock market. I am too, but what can I do about it? Nothing, so instead, I try and focus on the things that I can change. One of the most basic things I can do is to change my spending habits.

Although you have been told to lower your spending or to spend more wisely many times, have you ever actually monitored your own spending? How much do you actually spend every month?

Ever since I started traveling outside of the US, I decided to keep track of exactly how much I am spending. Using some resources from my favorite personal finance book, Your Money or Your Life, I began keeping track of the money I spent, categorized by the type of expense. At the end of the month, I tabulated all of my expenses, broken down by category, and looked at how each category affected my happiness and feeling of satisfaction. Was I glad I spent 75 dollars to eat out in one week? Or did I feel more satisfied cooking dinner for a dinner party? By noting my spending and answering some questions about my habits once per month, I developed a personal spending plan for myself.

Over the next few articles, I'll write a detailed strategy for creating your own personal plan. You will learn how to track your spending, how to decide which purchases were worth it, and how to push yourself towards good spending habits. Stay tuned!

It’s easy to see that an item is on sale and think that you’re getting a good deal. Even better is to know the unit price you typically pay and compare that to the offered price.

I seem to remember that Hannaford Supermarkets previously did not believe in having sales or requiring customer loyalty cards. I suspect their logic was that it was better to offer fair prices all the time than to have sales on over-inflated prices. I’ve found that regularly priced items at one retailer are often less expensive than sale prices at other stores. As I mentioned in my post about Wholesale Clubs, it’s important to always compare unit prices, since different retailers may carry different package sizes.

If you have trouble remembering the unit price of many items, you can keep a small notebook (or PDA, etc.) with you as a reference. You can list the product, regular unit price, and store. Only keep records of the lowest prices that you can find. You can also make a separate entry for the sale unit price, which may be at a different store. When you’re out shopping, you can reference your notebook before making a purchase. If the price is better than the normal price you pay, you may choose to purchase it. If it’s better, but not as good as the best sale price you’ve gotten, you may hold off depending on how urgently you need the product. When you see an item offered at, or below, the best per unit price you’ve even seen, you might choose to really stock up.

Following this method will let you get the most for your money. Knowing where to shop for which items may lead to more driving, but lower gas prices make that much less of a financial burden. Whether you memorize the prices of your most common items, or keep a notebook for everything you buy, you’ll ensure that you never get blinded by the glow of a sale and end up paying more than you should.

Do you know the unit price of items you regularly buy?