These days it’s impossible to get decent interest rates on your saving account. Even beating inflation is unheard of. And then there’s talk about negative interest rates, which is already a reality in Denmark and Switzerland. Fortunately there are alternatives. With Bondora Go&Grow you get 6.75% interest on a euro account.
If you are beyond building a financial buffer of several months it’s time to look at alternatives for a simple saving account. Investing in P2P credit is one such alternative. With most platforms this means your money is locked up for a while and unless you diversify heavily you are exposed to the risk of lenders defaulting on your loans.
Bondora is an Estonian company that has been around since 2009. (Did you know Estonia scores better than the US on the Corruption Perception Index?) Up until last year they only offered the possibility to directly invest in individual loans, with high interest. Of course you could automate that. And get really good returns. But if you want to quickly take out your money, you end up with subpar performance.
Now, in 2018 Bondora launched their Go&Grow product. With Go&Grow the entire process is automated and you can take out your money whenever you want. The cost for a withdrawal is 1 euro.
Go&Grow Pros and Cons
These are the advantages of investing through Bondora Go & Grow:
- Guaranteed return: 6.75% year over year
- You can exit any moment
- Lower risk than usual P2P investments
- You can convert your existing Bondora portfolio into Go&Grow
- 1 euro withdrawal cost, independent of your account size
- With 200 euro on your account you already make back €1 in a month’s time
- Perfectly suited for beginning investors
- No volatility like with the stock market
- No yearly management fees
- You can share access to your Go&Grow account with friends and family
- Return is lower than more active P2P investments, like with Estateguru, Mintos, Twino and other fintech companies in the Baltics.
- Your money is used for loans in Estonia, Finland and Spain. If the economy tanks in those 3 countries the default risk will be much higher.
- Estonia’s neighboring countries include Russia, so changes in the worldwide political situation could seriously affect Estonian economy in an unexpected way and if you are scared of these scenarios you may be better off investing in gold and Bitcoin.
How do I invest outside of the US?
The first step is probably to open an account with Transferwise. You don’t want to be hurt on the currency exchange fees and (more importantly!) the rates.
The advantage of investing outside of the US is to decrease your exposure to the US dollar. It also gives more
Early 2019 Bondora has started offering automatic withdrawal functionality. This means that if you put in a bunch of money you can use it to have a good flow of cash. With $100,000 you can get roughly $500 coming in every month. Your assets remain totally liquid, unlike real estate, and there’s no headaches like with renting out real estate.
Wanna try Bondora?
Sign up at Bondora or compare first with other p2p investing platforms at the Best Peer to Peer Lending for Investors
These are p2p lending platforms that can be a good alternative to Bondora:
- Twino, based in Latvia, many loans with buyback or payment guarantee, thus reducing the investment risk
- EstateGuru, based in Estonia, invest in real estate in the Baltic region
- Mintos, based in Latvia, one of the biggest platforms around, or rather meta-platform, as you can invest in loans from dozens of companies around the world. Great for diversification.