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Dividend Growth Investing

_Jay_Jay Posts: 3,377 My Name Is My Name.
edited August 25 in Strictly Business
the plan is to purchase shares in certain companies, ETFs, and REITs, that all pay dividends, while in my accumulation phase. the companies involved are to be Dividend Aristocrats, Dividend Champions, blue chips, and a few other companies I believe that are on the right track. due to good management practices, I expect these companies to increase their dividend payout every year...if a company freezes their dividend in the future, I may either stop purchasing shares of their stock and just hold on, or sell all of my shares and purchase more shares of other companies, depending on the scenario.

These are the companies that I'm currently long in:

AAPL Apple Inc
ADM Archer Daniels Midland Co
AFL Aflac Inc

BRKB Berkshire Hathaway Inc
CL Colgate-Palmolive Co
DIS Walt Disney Co
EMR Emerson Electric Co

FSLR First Solar Inc
GE General Electric Co
GIS General Mills Inc
HAS Hasbro Inc
HCP Healthcare Partners Inc
HSY Hershey Co
KO Coca-Cola Co

MVEN Themaven Inc
O Realty Income Corp
SBUX Starbucks Corp
SO Southern Co
T AT&T Inc
TGT Target Corp

TTWO Take-Two Interactive Software Inc
VFC VF Corp
VGK Vanguard FTSE Europe Index Fund
VOO Vanguard 500 Index Fund
VT Vanguard Total World Stock Index Fund
WBA Walgreens Boots Alliance Inc


list will be updated, as I purchase shares in other companies, ETFs, and REITs. the bolded pay dividends; the vast majority are distributed quarterly, DIS pays dividends twice a year, and O pays monthly.


..................ROLL DAMN TIDE



@JayChillinBro
Siontraestar313 wayzFocal Pointdasmooth1NothingButTheTruthtexas409ReignsTheBoyRoMD_PROPER VulcanRavenKoltrainfreshb651
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Replies

  • _Jay_Jay Posts: 3,377 My Name Is My Name.
    I started this process almost 2 years ago...the plan is to create MY OWN income via dividends, so that I can become financially independent, and never HAVE to work again, unless I choose to do so.

    atm, all of my holdings are in a brokerage account...depending on your age and circumstances, I would recommend one using either a 401k or an IRA, for tax purposes...with that said, the tax bracket I'm in results in me not having to sweat paying tax on my dividends, and with a brokerage account, I can tap my dividend income if needed, as opposed to having to pay a penalty for having to access a 401k or IRA before age 59. I have no plans to touch any of my dividend income for the next 8-13 years though, preferring to let it accumulate...

    ..................ROLL DAMN TIDE



    @JayChillinBro
    Siondasmooth1texas409Koltrain
  • _Jay_Jay Posts: 3,377 My Name Is My Name.
    edited October 2016
    at this current point in time, I'm looking at copping shares in 10 more companies, 1 more utility, and 1 more ETF, then just continue to purchase more shares in what I've already established positions in. there may be other companies I purchase, depending on future conditions and circumstances.

    common good advice is to hold shares in only a few companies...that's good advice. but my goal is to collect dividend payments across different companies and different industries. when it's actually time to live off of my portfolio, I have NO PLANS on selling any shares (#TeamBuyAndHold), I plan to live off of the dividend income itself. that's why I've purchased shares in so many different companies and plan to purchase even more.

    Dividend Aristocrats and Dividend Champions are known for increasing their dividend payouts every year...and blue chips are known for stability. so this is a way of creating a stable income flow that increases every year, without me doing any additional work.

    all I have to do is research which companies fit my needs, then purchase their shares at good evaluations. after that, I let time do the rest of the work.

    ..................ROLL DAMN TIDE



    @JayChillinBro
    Siondasmooth1
  • killapkillap Posts: 3,429 ✭✭✭✭✭
    Dope thread... I'm interested in learning more about your strategy. I'll stay tuned
    Sion_JayAP21Reigns
  • SionSion Moderator, Legion of Trill, AHH Content Producer, AHH Editor Posts: 44,350 Regulator
    I'm going to sticky this thread because I get a lot of inquiries about this process and this is the easiest way explained in the thread.

    I'll be back tonight and post up a list of monthly dividend paying companies who are paying yields in excess of 5-10% some of which are selling at 30-50% discounts. The ones Jay posted are much more guaranteed since they have long track records of profits and are older, extremely well run companies.
    IC Moderator and AHH Editor

    http://community.allhiphop.com/categories/site-help

    ^^^ If you need anything go here

    jono wrote: »
    This is the folly of the internet. Its become a bastion of misinformation, rumors, conspiracies and propaganda. A place where a person with no face or name can make accusations at any time with no verification or credentials and brainwash a small segment of people.
    T. Sanford wrote: »
    Message to the trills of the IC: May Legion Of Trill be your enemies downfall
    _JayKing Erauno
  • traestartraestar Atlantic City, NJPosts: 6,013 ✭✭✭✭✭
    _Jay_ wrote: »
    currently, there are some months when I receive dividend payments weekly, at times I even receive dividend payments from different companies during the same week. in the future, I hope to receive a dividend payment every week of every month, every year.

    I don't participate in DRIP programs; when I receive dividend payments, I use them to purchase shares of other stock (including my own capital), that way I can always purchase new companies that are at good valuations.

    Normally the ones that you are long on, it's better to DRIP them. But DRIP is not mandatory. The reason people DRIP some of their dividend stocks is because it builds on itself and you don't have to to constantly invest on it. It's actually better if you have a good amount of shares and the compound is enough to pay for multiple shares.

  • _Jay_Jay Posts: 3,377 My Name Is My Name.
    traestar wrote: »
    _Jay_ wrote: »
    currently, there are some months when I receive dividend payments weekly, at times I even receive dividend payments from different companies during the same week. in the future, I hope to receive a dividend payment every week of every month, every year.

    I don't participate in DRIP programs; when I receive dividend payments, I use them to purchase shares of other stock (including my own capital), that way I can always purchase new companies that are at good valuations.

    Normally the ones that you are long on, it's better to DRIP them. But DRIP is not mandatory. The reason people DRIP some of their dividend stocks is because it builds on itself and you don't have to to constantly invest on it. It's actually better if you have a good amount of shares and the compound is enough to pay for multiple shares.

    disagree with the bolded, I don't use DRIPs cuz they're indiscriminate; if the share price is inflated, that'll cause the average price per share to average up, instead of averaging down.

    for example, anyone using DRIP right now for...say KO (Coke), MCD (McDonald's), or MMM (3M) are all averaging UP on the price of their shares, as opposed to receiving dividends w/o DRIP'ing, then using those dividends to purchase shares of other stock at reasonable valuations...

    ^^ I'm already long on KO, but I take those dividends, add some capital, and purchase other shares elsewhere.

    ..................ROLL DAMN TIDE



    @JayChillinBro
    dasmooth1traestar
  • Focal PointFocal Point Kushite descent... wandering child from Meru of Old TrentonPosts: 16,156 ✭✭✭✭✭
    Good work bruh
    _Jaydasmooth1Reigns
  • NothingButTheTruthNothingButTheTruth stew Posts: 10,850 ✭✭✭✭✭
    _Jay_ wrote: »
    at this current point in time, I'm looking at copping shares in 10 more companies, 1 more utility, and 1 more ETF, then just continue to purchase more shares in what I've already established positions in. there may be other companies I purchase, depending on future conditions and circumstances.

    common good advice is to hold shares in only a few companies...that's good advice. but my goal is to collect dividend payments across different companies and different industries. when it's actually time to live off of my portfolio, I have NO PLANS on selling any shares (#TeamBuyAndHold), I plan to live off of the dividend income itself. that's why I've purchased shares in so many different companies and plan to purchase even more.

    Dividend Aristocrats and Dividend Champions are known for increasing their dividend payouts every year...and blue chips are known for stability. so this is a way of creating a stable income flow that increases every year, without me doing any additional work.

    all I have to do is research which companies fit my needs, then purchase their shares at good evaluations. after that, I let time do the rest of the work.

    How much do you save up before you buy stock in a specific company? I generally wait until I have anywhere from 5K to 10K saved up. What's the minimum amount of dividend yield you accept?

    If you're buying shares in multiple companies, don't you get hit with the trading fees pretty hard? My online account charges ~$9 for each trade.

    You mess with REITs (real estate investment trusts) at all? When I'm searching for high dividend yield companies, I notice they usually top the list.
    traestardasmooth1
  • _Jay_Jay Posts: 3,377 My Name Is My Name.
    edited November 2016
    _Jay_ wrote: »
    at this current point in time, I'm looking at copping shares in 10 more companies, 1 more utility, and 1 more ETF, then just continue to purchase more shares in what I've already established positions in. there may be other companies I purchase, depending on future conditions and circumstances.

    common good advice is to hold shares in only a few companies...that's good advice. but my goal is to collect dividend payments across different companies and different industries. when it's actually time to live off of my portfolio, I have NO PLANS on selling any shares (#TeamBuyAndHold), I plan to live off of the dividend income itself. that's why I've purchased shares in so many different companies and plan to purchase even more.

    Dividend Aristocrats and Dividend Champions are known for increasing their dividend payouts every year...and blue chips are known for stability. so this is a way of creating a stable income flow that increases every year, without me doing any additional work.

    all I have to do is research which companies fit my needs, then purchase their shares at good evaluations. after that, I let time do the rest of the work.

    How much do you save up before you buy stock in a specific company? I generally wait until I have anywhere from 5K to 10K saved up. What's the minimum amount of dividend yield you accept?

    If you're buying shares in multiple companies, don't you get hit with the trading fees pretty hard? My online account charges ~$9 for each trade.

    You mess with REITs (real estate investment trusts) at all? When I'm searching for high dividend yield companies, I notice they usually top the list.


    it depends on the amount of capital I'm already sitting on and price fluctuations. for example, right now, I'm planning on purchasing more shares of Disney (DIS), in order to average down on price (Disney's currently overvalued in my portfolio, I initiated a position when they were over $110/share, and they're currently less than $93/share). while I'm stacking capital with my eye on Disney, I'm also noticing that the price of HCP has gone down, and it's prime time for me to cop more, in order to average down on price...with that said, I'm also seeing the price of Lowe's (LOW) is currently within striking distance, and I currently don't have a position with them at all.

    do I cop a few more shares of Disney? a handful more of HCP? or a handful and initiate a new position in Lowe's? choices...

    I used to give myself grief when purchasing single shares...until I read that Warren Buffet does it as well...he does it in order to study a company before possibly building a larger position, I do it after deciding I'm definitely going to initiate a position but just want to get my foot in the door (and increase my dividend flow). but to answer the question, it depends on the capital I've already saved and price fluctuations...I may cop as much as I can, I may cop a single share. what works for me, works for me.


    minimum dividend yield? that kinda varies...when I first started out, I was chasing yield, but didn't understand the concept at the time. when I realized what I was doing, I chilled, and began researching the companies more in depth, to avoid purchasing an MLP or a REIT that had an unsustainable dividend. nowadays, when selecting a company, I look for firms whose current yield is 2% or more. I look at their 5 year average as well, but that doesn't always tell the whole story:

    atm, the company that produces the lowest dividend that I own is Starbucks (SBUX)...their current dividend is .20/share, yield is 1.51%, and their 5 year average is 1.26%. BUT...I also own Apple (AAPL)...whose current dividend is .57/share, yield is 2.05%, and 5 year average is 1.26%. if I focused solely on 5 year averages, I'd be missing out on Apple's juicy azz dividend...


    before opening a brokerage account, I did a LOT of research...went on Consumer Reports and erything, lol. Tradeking is the brokerage account I chose [I was leaning towards TD Ameritrade ($9.95/trade) and Charles Schwab ($7.95/trade) initially], in part cuz of their lower fees (Tradeking's fees are $4.95 per trade). the fees are per trade, not per share, so one can cop multiple shares of a single company and still only pay $4.95 for the transaction itself.


    I was considering quite a few REITs in my chasing yield days, but I eventually settled down to wanting to purchase Dividend Aristocrats/Dividend Kings, and that narrowed the field a lot...the only REIT I have a position in is HCP, and I'm gonna continue adding on to them, prolly in the near future goin by their current stock price lol, but I have no plans of adding any other REITs to the portfolio at this time.






    ..................ROLL DAMN TIDE



    @JayChillinBro
    NothingButTheTruth
  • texas409texas409 Posts: 20,370 ✭✭✭✭✭
    edited November 2016
    I know these are investments and take time to see the pay off but im wanting to know some ground level basics. How much to invest and how long does it usually take to see profits from your investments?

    how much are those profits?
    @_Jay_
  • _Jay_Jay Posts: 3,377 My Name Is My Name.
    texas409 wrote: »
    I know these are investments and take time to see the pay off but im wanting to know some ground level basics. How much to invest and how long does it usually take to see profits from your investments?

    how much are those profits?
    @_Jay_

    I opened the brokerage account in November 2014, purchasing 1 share of 1 company. first dividend payment arrived in January 2015. with the exception of none in February, I've been getting more and larger dividend payments every month since, as I've purchased more shares in more companies. started off receiving cents and have already worked my way into receiving dollars every month. keep in mind this is all within less than 2 years, but the snowball has started, and is rolling...

    I ignore capital gains, and only focus on stock prices when I'm about to purchase more shares. with the exception of Disney (DIS), each of my dividend paying companies pay me around every 90 days. they also tend to raise their dividends once a year. Disney only pays twice a year...for now.

    this is dividend growth investing tho, my focus is on the dividends themselves...if you're more interested in the idea of selling shares and locking in capital gains, u might wanna check Sion's thread: http://community.allhiphop.com/discussion/246886/sions-how-to-invest-thread-everything-you-need-to-invest-properly-and-much-more/p1


    ..................ROLL DAMN TIDE



    @JayChillinBro
    texas409
  • mike06mike06 Posts: 2,613 ✭✭✭✭✭
    how much did you start out with to invest?
  • _Jay_Jay Posts: 3,377 My Name Is My Name.
    mike06 wrote: »
    how much did you start out with to invest?

    $40.

    one of the perks of my brokerage account was "no minimums." copped 1 share of General Electric (GE) without doin any research (smh), and jumped right on in. purchased 1 share of Coke (KO) next cuz Buffett, then my first ETF, Vanguard S&P 500 (VOO)...then stacked more capital with my birthday, Christmas bonus, PTO cash, and income tax.


    ..................ROLL DAMN TIDE



    @JayChillinBro
    mike06silverfoxx
  • _Jay_Jay Posts: 3,377 My Name Is My Name.
    an important lesson in dividend growth investing:


    Time in the market beats timing the market...basically, the longer you're in the market, the longer you're giving your assets time to appreciate and dividends to grow and compound. also, one gains wisdom just by becoming more familiar with the process, such as learning how to not panic and sell off during a correction for example...

    there's a decent to good chance that one can become Financially Independent 10 years after starting...and depending on one's debt and/or savings rate, even sooner than that...those 10 years are gonna pass by, regardless if you're investing or not, might as well make your money work for u, so u can truly call your own shots down the road.

    if you're in your 20s or 30s and are reading this...my advice to u is to start asap. it's really NOT as complicated as all the business channels make it appear, and again, Time in the market beats timing the market.

    ..................ROLL DAMN TIDE



    @JayChillinBro
    NothingButTheTruthdasmooth1dwade206
  • silverfoxxsilverfoxx Posts: 11,323 ✭✭✭✭✭
    _Jay_ wrote: »
    an important lesson in dividend growth investing:


    Time in the market beats timing the market...basically, the longer you're in the market, the longer you're giving your assets time to appreciate and dividends to grow and compound. also, one gains wisdom just by becoming more familiar with the process, such as learning how to not panic and sell off during a correction for example...

    there's a decent to good chance that one can become Financially Independent 10 years after starting...and depending on one's debt and/or savings rate, even sooner than that...those 10 years are gonna pass by, regardless if you're investing or not, might as well make your money work for u, so u can truly call your own shots down the road.

    if you're in your 20s or 30s and are reading this...my advice to u is to start asap. it's really NOT as complicated as all the business channels make it appear, and again, Time in the market beats timing the market.

    Where is a great start for me to make my first investment? Ive taken accounting, hated it but I understand the importance of it regarding proper investments in spending and generating money. I'm 24. I plan to make my first investment before the year is out. Have to dust of my accounting studies but I'm willing to aquire knowledge.
  • _Jay_Jay Posts: 3,377 My Name Is My Name.
    edited November 2016
    silverfoxx wrote: »
    _Jay_ wrote: »
    an important lesson in dividend growth investing:


    Time in the market beats timing the market...basically, the longer you're in the market, the longer you're giving your assets time to appreciate and dividends to grow and compound. also, one gains wisdom just by becoming more familiar with the process, such as learning how to not panic and sell off during a correction for example...

    there's a decent to good chance that one can become Financially Independent 10 years after starting...and depending on one's debt and/or savings rate, even sooner than that...those 10 years are gonna pass by, regardless if you're investing or not, might as well make your money work for u, so u can truly call your own shots down the road.

    if you're in your 20s or 30s and are reading this...my advice to u is to start asap. it's really NOT as complicated as all the business channels make it appear, and again, Time in the market beats timing the market.

    Where is a great start for me to make my first investment? Ive taken accounting, hated it but I understand the importance of it regarding proper investments in spending and generating money. I'm 24. I plan to make my first investment before the year is out. Have to dust of my accounting studies but I'm willing to aquire knowledge.

    a great start would be depending on what you're tryna do...if you're interested in the overall best case, u may wish to consider an ETF (exchange traded fund), which for technical purposes acts like a stock. an ETF tracks an index, and you're basically invested in every company in that particular index. Vanguard is a company very well-suited for this (google'em, even Warren Buffett recommends them for his spouse after his death), and one can purchase the entire American market with one ETF, the Vanguard Total Stock Market ETF, VTI. it trades like a stock, and pays dividends every 90 days.

    full disclosure, I don't have any shares of this ETF at this time...I do have shares of VOO (S&P 500 index), as well as shares of VT (Total World Stock), but I will purchase shares of VTI in the future...


    if you're interested in individual stocks and not interested in index funds/ETFs, that's cool...in that case, I'd recommend u googling the Dividend Aristocrats (all whom pay dividends, AND have raised their dividend payout every year for at least 25 years), choosing which companies meet Your needs, and selecting from there...


    as time goes on, u can purchase other companies/ETFs, of course, these are just a starting point, for one not yet familiar with this environment. and before u purchase anything, do your homework, as well as try to purchase at a low evaluation.


    great reading material is the first 4 parts of J.L. Collins' Stock Series: http://jlcollinsnh.com/stock-series/
    he's gonna steer one in the direction of ETFs, and that's fine, whether u go the individual stocks route, the ETF route, or both...my advice is to read the first 4 in the series, in the order 2, 1, 3, and 4 (there's a better flow in that order IMO).


    ..................ROLL DAMN TIDE



    @JayChillinBro
    silverfoxxReignsdasmooth1
  • 2stepz_ahead2stepz_ahead Who I am is Complex, What i am, simply put. I'm a Threat walking out the lions denPosts: 29,631 ✭✭✭✭✭
    i see i wasnt involved in the shouting out....

    i see how it is @_jay_

    yall never want to give a black man his props
    you have the dude who is naturally thorough -Alpha
    you have the dude that wants to be thorough so he pretend to be Alpha -Beta
    then you have the nigga who wants to hang with the first two to be seen and grab any dropped crumbs.- Omega

    I am still struggling between blocks to get from the have nots to the have yachts and I won't be stopped.



    http://www.youtube.com/watch?feature=player_embedded&v=HhTZZdVbjio


  • _Jay_Jay Posts: 3,377 My Name Is My Name.
    don't be like that bruh...fr

    ..................ROLL DAMN TIDE



    @JayChillinBro
  • ReignsReigns Posts: 305 ✭✭✭✭
    Yo this is what I'm talking about! Jay I appreciate this. This is exactly what I wanted/thinking of when I first started investing. What do you consider being "long" in a company. I invested in a couple of the companies you mentioned above, but I stopped because I wasn't disciplined (lost like $200 in the first week or so) but I'm ready to start back. Should I invest more in them or put money into other companies.
    _Jay
  • _Jay_Jay Posts: 3,377 My Name Is My Name.
    edited November 2016
    Reigns wrote: »
    Yo this is what I'm talking about! Jay I appreciate this. This is exactly what I wanted/thinking of when I first started investing. What do you consider being "long" in a company. I invested in a couple of the companies you mentioned above, but I stopped because I wasn't disciplined (lost like $200 in the first week or so) but I'm ready to start back. Should I invest more in them or put money into other companies.

    when I first started out (and to this day), when I'm unsure of a term, I hit Investopedia.com (s/o to Sion):

    What is a 'Long (or Long Position)'

    A long (or long position) is the buying of a security such as a stock, commodity or currency with the expectation the asset will rise in value. In the context of options, it is the buying of an options contract. A long position is the opposite of a short (or short position).

    Buying a call (or put) options contract from an options writer entitles you the right, not the obligation, to buy (or sell) a specific commodity or asset for a specified amount at a specified date.

    BREAKING DOWN 'Long (or Long Position)'

    With a long position investment, the investor purchases a commodity and owns it with the expectation the price is going to rise. He normally has no plan to sell the commodity in the near future. A key component of long position investment is the ownership of the stock or bond. This contrasts with the short position investment, where an investor does not own the stock but borrows it with the expectation of selling it and then repurchasing it at a lower price. A key difference between a long position and a short position in investments is what the investor expects to happen to the price of a commodity.

    http://www.investopedia.com/terms/l/long.asp



    TL,DR version: when u purchase a share/shares and hold on to them in the near term, expecting them to go up in value.

    once you've actually got a brokerage account, it'll automatically show u stocks that you're "long" on...


    when u lost the money...what did u do, sell your shares?

    as far as whether u should invest in the same companies versus different companies...that kinda depends on what you're investing for...are u investing for dividends only? are u just tyna beef up your portfolio, and you're considering buying/selling shares in the future? the answer to both is, depends on the companies you're looking at, and their current valuations right now...are they lower than before? or are the companies u have not purchased at lower valuations than the ones you've sold in the past?



    ..................ROLL DAMN TIDE



    @JayChillinBro
  • _Jay_Jay Posts: 3,377 My Name Is My Name.
    edited November 2016
    yeah, I'm prolly done with getting any new REITs.

    Healthcare Partners (HCP) are cutting their dividend. They were previously considered a a Dividend Champion, having over 30 years of rising dividends. That ends this month, after HCP spun off a company, as well as had some legal issues.

    Their previous dividends were .575/share. After cutting the dividend, the new payout is .37/share. honestly not bad, but far less juicy than their previous dividend payouts...

    Since the new dividend isn't bad, (the .37/share yield is at 5.13%), I'm not planning on selling my current shares...however, with that being said, I have no plans on purchasing anymore...

    Not all of my companies are Dividend Champions, Dividend Aristocrats, or Dividend Kings...but a stable dividend is why I'm even doing this in the first place, so there's no room for companies whose dividends aren't continually growing. I have no plans of selling shares at this time, but also have no plans of purchasing more.

    ..................ROLL DAMN TIDE



    @JayChillinBro
    dasmooth1
  • King EraunoKing Erauno Posts: 6,733 ✭✭✭✭✭
    dope thread. i was looking to see the benefits of buying stocks that pay out monthly as well. i got a long list of stocks that do this.. will post these later (once i remember what i did with the list)
    _Jay
  • EmM HoLLa.EmM HoLLa. Rolex Watches & Diamond Chains.. Posts: 3,130 ✭✭✭✭✭
    Dope shit Jay..
    When the ice hit the light it be going off.. I'm livin' life I aint showin' off.. -Don Q
    _Jay
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