June Portfolio Report
Welcome to my monthly portfolio report! This month has been a month where I’ve truly started seeing more cumulative results from my P2P investments – my income almost doubled when you compare it to last month, even though I haven’t made any significant deposits.
With that said, let’s get straight into it!
Mintos – € 3 253.90 (last month’s balance: € 3,223.80; Interest received: €30.10 – 11.65% pa)
Envestio – € 1 563.51 (last month’s balance: € 1,537.33; Interest received: €26.18 – 20.94% pa)
Grupeer – €1,021.72 (last month’s balance: €1,011.49; Interest received: €10.23 – 12.23% pa)
RoboCash – € 1,229.31 (last month’s balance: €1,020.17; Interest received: €9.14 -10.97% pa)
Estateguru – €1,009.29 (last month’s balance: €1,005.01; Interest received: €4.28)
Note: I don’t add EstateGuru’s yield because the interest from projects is mostly paid quarterly/bi-annually.
Total P2P: €8,077.73 / last month: €7,797.80
Total Interest Received: €79.93 / last month: €69.82
Total Deposites Made: RoboCash: €200 / Student Loans: €925 (€21,236.21 remaining at 3.3% interest and €24,997 remaining at 0% interest) / Total: €1,125
Rate Of Return: ~13.4% (excluding EstateGuru)
June net income from other sources (after tax): €2,610
Blog visitors: 307 users (+218)
What’s Up In June?
I’m a bit late with my June update because I spent 2 weeks travelling in Norway and seeing friends back in my home countries Finland and Estonia. Norway’s landscape is amazing, and it’d definitely recommend everyone to go there at least once in their life! 🙂
Here’s a few pictures of me and my friend Jasmine hiking Trolltunga in West-Norway, overlooking some spectacular fjords:
And yes, the rumours about Norway are true: It’s expensive as heck.
I didn’t count my pennies when I was there, but I would estimate that the trip must’ve cost me about €1,200-€1,500 or something like that. A bit expensive for 10 days, but still completely worth it!
Somehow I still managed to find a decent amount of money to save/invest. Even though I didn’t hit my target of €1,500, €1,125 is pretty reasonable considering that I managed to do two different trips during the month.
In regards to my investments, I’m pretty happy with the way things are going. I’ve stopped obsessing over the platforms and now login about once a week just to check that everything is running smoothly and that there aren’t any complications. I can’t help but retain a bit of cynicism about investing online, so checking my account statements regularly helps me keep my peace of mind.
In June, the total interest received was already almost €80, which for me is quite a lot, considering that I only started investing in P2P January of this year.
The platforms where you can see the most amount of growth (strictly monetarily speaking) are of course Envestio and Mintos, because those are the platforms where I have the most amount of money invested.
Envestio’s Impressive Returns
I’m especially impressed with Envestio – the rate of return here is over 20%, which is just insane! However, I am still a little bit cynical about the platform, because everything seems a bit too good to be true.
So far, there haven’t been any complications with the projects, but we can only wait and see what happens when the projects finish and it’s time to re-pay the principal. My first completed project will be in August, so I’ll let you know what happens around that time.
Here’s a screenshot of my account with the latest details as of July 15th:
Repaying Student Loans Instead Of Investing?
For those of you who haven’t been following British politics or checking up the latest GBP to EUR charts you may not know that the sterling isn’t doing so well. In fact, it’s at historical lows now and it may crash even further when Boris Johnson gets elected as PM.
Yes, I’m saying when instead of if because almost everyone in the UK is certain that he will be elected as he’s known to be a hard-Brexiteer and this is something that the members of the Conservative party want.
Now, what this means for me is that it’s an excellent time to repay some of my student loans that I’ve accumulates here in the UK. I still owe about £19,000 to the U.K. government and then a further €25,000 to my family who have kindly helped me pay off the government debt.
The way that student loan debts work in the U.K. may be a little bit hard to understand, so I’ll give a brief explanation.
If you earn less than £25,000, you will have an interest rate that is equivalent to the RPI (retail price index, which is linked to inflation) during the previous April. So, for 2018-2019, it’s been 3.3%. Next academic year, it will be 2.5%.
For anyone earning more than £45,000+, the interest rate will be RPI + 3%. So for this year, it would be 6.3%. For next year, it would be 3% + 2.5% = 5.7%.
For any employee who falls between these two salaries, the rate will be calculated as something between the two, gradually increasing to 3% + RPI.
You are only required to pay 9% of your salary after £25,000 towards student loans. So technically, anyone earning under £25,000 doesn’t have to pay a dime towards repaying their student loans, but the interest will keep on ticking.
After 30 years, the loan will be wiped out, even if you’ve repaid none of it.
As you can see, for those people who will only earn around £25,000 all their life, this system is perfect. However for anyone else, it would make more sense to repay their debt ASAP before it gets out of hand and before the interest skyrockets.
If you do the math, even if you start repaying the minimum amount required, you don’t even scratch the actual loan – you’re just paying off interest.
So, my plan is to pay off as much debt as possible before the interest rises to above 6%. At the moment, my interest is 3.3%, so it may not make sense to many readers why I would want to pay it off instead of investing that money.
Well, this is why. A 6% loan is pretty similar to an investment that yields 10%+ once taxes have been accounted for. And with investments, there’s always a risk that you’ll lose money. With debt, paying it off is a surefire way to increase your net worth.
And because the sterling is falling, it’s even more beneficial to pay off the debt now as opposed to later, when it may rise again.
Originally, my goal was to get my loan down to £18,000 this year, but we’ll see if I end up paying more towards my student loans if the sterling remains weak. I’m still more tempted to put the remaining money towards passive investments for now!
Let me know your thoughts about this down in the comments!
P.S. In next month’s portfolio report I’ll be talking more about stocks and real estate, so if that’s something that you’re interested in, subscribe to the newsletter to be notified when the post goes up!
You can head over to my portfolio to see the latest state of my portfolio and where my money has gone in the last months!