July is here and that means we’re already halfway the year 2021, so time for some reflection and to look ahead for what’s coming next. Off course I will also give a detailed breakdown of my passive income for June.
Albania here I come!
In my last update I announced that I decided to quit my job and on June 30th it was finally my last day in the virtual ‘office’.
Little did I know about what was coming when our office closed and I was told to work from home temporarily in March of last year. It turned out to be my last day in the office as working fully remote for more than a year had worked out so well for me that I decided not to return at all. I think the remote working situation has also mentally prepared me well for my next adventure as a digital nomad.
After spending the last 10 years living and working in Ireland I have returned to my home country the Netherlands for a while in order to prepare for the next chapter in my life. Later this month I will get my second corona vaccination so I should be all ready to go and my first destination will be Albania.
I’m still busy with a lot of preparations but soon I will have all the time to myself so I will write more about my decisions and adventures, and off course the financial aspects of leaving my secure job for an open ended adventure.
My Passive Income in June
Despite leaving my well-paid job I will still keep my focus on growing my passive income, so I will ultimately be less dependent on other, active income sources.
In June I received a total of €580,98 in passive income, of which €287,61 came from P2P lending and €293,37 from dividend payments. This means I’m currently at 38,7% towards my goal of €1500 monthly passive income.
The graph below shows how my monthly passive income has grown since the start of the year:
P2P Lending Portfolio
Let’s first have a look at my portfolio in Peer-to-Peer lending. At the beginning of June I added another €750 towards my P2P investments and after receiving the interest payments throughout the month my portfolio now looks as follows:
I added €500 to my Mintos account at the beginning of June and throughout the month I received a total of €111,48 in interest.
As you can see in the screenshot of my Mintos dashboard below, I still have €2.070,48 in recovery. The amount has not really changed much for a while so my current investments are performing well, but I’m also curious to see how long it will take to get anything in recover back.
In an interview with P2P Empire, Mintos CEO Martins Sulte provided more details about the recovery process and how they do due dilligence and he also gave an update about the process for Mintos to get an investment firm license. You can watch the full interview on Youtube.
On their website Mintos has also updated the risk scores for each loan originator as they see that the recovery of the market has a positive influence on the profitability of some of the lending companies. Mintos also continues to publish financial results of each loan originator with comments on the website’s blog.
In June I received €81,51 in interest on EstateGuru, so this has gone back up again as I didn’t purchase any projects on the secondary market this month.
I keep noticing that interest rates on EstateGuru have gone down and the number of interesting projects available for manual investing has declined over the last few months. I’ve seen more projects at rates below 10% with some even as low as 7,5% or 8%. I don’t mind an occational investment at 9% or 9,5% as it’s always better than keeping the money uninvested, but I’m really not interested in anything lower than that.
So far it hasn’t really bothered me as I still manage to keep my money invested by investing a bit more in each loan, usually €100 or sometimes an additional €50 when it’s a further stage loan of a project I’m already invested in.
On their blog, EstateGuru’s board member Gabriella Kindert mentions that investors don’t have many attractive alternatives, which I believe is partly true as interest rates are generally down a bit in the P2P market. With real estate and stock markets at peak levels it has indeed become more difficult to find good investment opportunities that produce a good enough return, but also some diversification to be able to sleep well.
My plan is to spend more time doing research to find good quality opportunities to keep diversifying my investment portfolio.
In June I received €33,07 in interest from IUVO Group. I feel like I’m repeating myself but so far IUVO Group has been my most hands-off P2P platform (except Bondora Go&Grow off course) as I never faced any difficulties and my money is always invested so I never had to make any changes to my auto-invest settings or purchase any loans manually.
An interesting fact to know is that IUVO Group has an exclusive partnership with Ibancar, a loan originator that specializes in car loans. Fellow P2P investor Bernhard Hummel visited their office in Spain for an interview with Ibancar’s CEO, Alex Melis.
In this interview Alex explains the difficulties of managing a lending company in a tough and competitive market where there is a lot of pressure on growth, rather than profitability. Alex explains why this is unhealthy and causes many business models to fail, and refers to the collapse of some lending companies during tough market conditions like the pandemic last year.
According to Alex Melis, Ibancar has stepped away from the pressure to only focus on growth, to be able to build a sustainable business model with cars as collateral for their loans.
Ibancar has chosen to list their loans exclusively on IUVO Group because they have a good feeling about them, they have a stable management team and are ahead of others when it comes to technological developments, which gives them a competitive edge to issue loans to their clients much faster.
I would recommend watching this full interview on Youtube if you want to know more about Ibancar and how everything works behind the scenes with respect to car loans. In the interview Alex also shares his view on the P2P market and the broader fintech industry, including the necessary regulation.
Regarding PeerBerry I didn’t make any changes and in June I received €26,36 in interest on this P2P platform.
PeerBerry continues to show that they are an innovative player in the fintech industry by continuously enhancing the user experience with additional features. The desktop version of the account overview page has been completely revamped in line with the mobile app. It’s now much easier to view stats from your portfolio with interactive charts to visualize the performance of your portfolio.
PeerBerry has also published financial statements of some of their loan originators, which all show a profit over 2020, despite the difficult market conditions during the pandemic. What’s also important in my opinion, is that these statements are all audited, which is unfortunately not always the case in the P2P market.
In June I received €16,20 in interest from Viainvest and I didn’t make any changes to my strategy. Since I increased the maximum amount per loan to €30 I haven’t had any issues with cash drag anymore.
Stocks & ETFs
In June I received a total of €293,37 in dividend payments from a variety of individual stocks and Exchange Traded Funds (ETFs). Below is an overview of the dividends I received:
|Johnson & Johnson||€7,38|
|Royal Dutch Shell||€16,97|
|Wheaton Precious Metals||€29,44|
|Agnico Eagle Mines||€7,36|
|Franco Nevada Corp||€4,21|
|VanEck Vectors Global Real Estate UCITS (ETF)||€36,97|
|SPDR S&P US Dividend Aristocrats (ETF)||€25,71|
Since the stock market is currently very high, and many stocks have regained their losses of the pandemic crash last year, I feel most comfortable investing in ETFs at the moment. This way I don’t have to pick stocks myself and it’s the easiest way to stay diversified.
By investing every month I’m also using the principle of dollar-cost-averaging, which means my purchase price goes up and down with the market. This way I’m also less worried about a potential crash, as I know I can buy cheaper if this happens and I don’t intend to sell any assets that produce cashflow anyway.
Now that I have left my ‘golden cage’ the road to financial freedom will be more challenging. But this also means more inspiration to share how I deal with this challenge, how I will finance my new lifestyle as a digital nomad and about the cost of living abroad.
Feel free to comment or send me any topics you would like me to cover now that I will have more time to write.