This is all new to me so I need help

Hi and welcome to the world of P2P, baz.

When I paid a significant cheque into my bank and the cheery clerk commented on what a nice windfall it was and whether I was planning anything nice it was only the glass screen and her being a lady that prevented me punching her in the face! Bank staff need training that people presenting large cheques from companies that specialise in life insurance are rarely in the mood for chitchat.

Anyway, enough about banks. I like FC, it gets a lot of (deserved) criticism here but it's a good way to "play" with your money because you can get better returns by actively managing your bids and portfolio. Rates fluctuate quite wildly, low if there's a surplus of lender cash and high if there's a surplus of loans. Recently there's been a loan glut, with over 100 auctions at any one time, and rates have been at a high not seen for ages, but things are settling down to more normal levels now.

I would diversify between P2P providers, there are lots of different models and loan types so you can spread risk quite well. FC specialise is unsecured business loans (although they are getting into property), Assetz and Wellesley specialise in loans secured on property, RateSetter and Zopa on unsecured personal loans and so on. Platforms with a provision fund generally provide lower headline rates but potentially lower risk. Remember though that no P2P model is risk free.

I would also have some investments outside P2P, in more traditional investment funds for example. While we are all enthusiastic supporters of P2P here, we should always remember it is a relatively young and small industry and we don't know what the future holds.

Hope this helps.