Passive Income – 2013 Goals

finish-line_2013 GoalsImportant in every aspect of life is the ability to set tangible and personal financial goals. By setting specific and quantifiable goals, I am accountable to myself, and by extension, you the reader. My passive income goals for 2013 are based on my investments in a dividend growth Roth IRA portfolio and a peer-to-peer lending Roth IRA account.

Lending Club – Net Interest of $1,000

This goal will give me an approximate 10% net return on my $10,000 dollar investment in Lending Club. This goal takes into consideration the fact that as of the beginning of February I am less than 60% invested in notes. As such, this will be a tough goal to achieve without outperforming the 10% throughout the year as I gradually invest the entire investment. As a further note, the net return is net of all fees collected on payments and any charge-offs or defaults of notes in the account. Additionally, all repayments will be reinvested into additional loans throughout the year.

Dividends – Total Dividends of $700

Having not previously set, analyzed, and pursued a dividend income goal with my investments I have decided to dedicate some serious work into growing my dividend base, and expanding this portion of my retirement savings. At this time, I am only going to include my Roth IRA account in these calculations. My 401(k) and other investment accounts will be maintained separately at this time.

Trading: Options Income – Total Options Income of $300

In conjunction with growing my dividend growth portfolio, I am looking to put into place a very basic options strategy. This strategy will involve selling calls and puts with the goal of increasing my return for both my idle cash, as well as any positions I currently hold. I am very new to options trading, and am really looking forward to this learning opportunity. Depending on my success during 2013, I will consider making this a permanent part of my investing strategy in the future.

Total Passive Income

In total, I am hoping to hit the $2,000 mark in passive income from these investments. I will be updating my progress on these goals on a monthly basis. This post, and subsequent updates, can be found under the goals page.

If you enjoyed this post, subscribe below to get to receive new posts by email.

Comments

  1. Congrats on starting your blog and putting together goals. You are still young enough to invest and let your money compound for many years. I look forward to your updates.

  2. Congrats on getting the blog up and running. Having a blog myself has made me be much more accountable to myself knowing that I’ll have to post about any sidetracks that I take. That seems like a pretty hefty weighting towards LC. About 40-50% of the size of your dividend portfolio? I do like the idea of LC but unfortunately I can’t use it in my state except on the secondary market, which I’m sure is mainly underperforming loans.

    • writing2reality says:

      Thanks for the comment JC! Two of my primary purposes of the blog are to promote long-term accountability and to develop an easy method to track my performance long-term.

      As far as the relative size of the portfolios, this is for two reasons: One, a Roth IRA at Lending Club is free for those who open an account with $5,000, and have $10,000 invested by the next year. I simply avoided step one by rolling over the full $10,000 amount. No fees, no extra rollover costs. Second, my dividend portfolio currently consists of a piece of my Roth IRA, and is not the entire part of my equity investments. Outside of the money in there, I have money invested in an investment club, my 401(k) at work, and various other places. My goal going forward is to track this part of my Roth IRA initially, and expand that to a taxable account as well, with the idea that the main taxable account is what produces an ongoing stream of income to be used prior to me being old and bald at the age of 59 and a half.

      As far as only thinking that the loans on Folio are bad, I would recommend you take a second look. While certainly not the easiest of methods, you can still have tremendous success on the secondary market. Here is a link to a guest blog post on LendAcademy, the premier peer-to-peer lending blog, whose author only invests via the secondary market. I would also recommend you check out the forums there as well, as there are plenty of strategies and discussion about secondary market transactions. Investing in peer-to-peer lending is absolutely a viable option, either directly or through the secondary market.

  3. I’m new to options trading as well. I hope to start making some basic options trades this year, mainly selling put options. I noticed you have BP in your portfolio. Its been a recent addition of mine early this year also. Nice yield with hopefully steady growth.

    • writing2reality says:

      Selling puts will definitely be the main focus of my options trading. Good opportunity to make some additional income while lowering your cost basis upon assignment. I am satisfied with BP. I think they are still be pushed down by the spill, as well as the divestitures. With plenty in the pipeline in the next couple years, I think BP could be a good investment for yield and growth.

Leave a Reply