Website review: LIVING OFF DIVIDENDS & Philosophy
dbandcbinc discovered this in Investing
•5 reviews since Feb 2, 2008
investing
•livingoffdividends.com/philosophy/
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Reviews of this website
Laboo63 rated 5 months ago- From the page: "Philosophy For most people, living off their investments sounds like a dream. When they hear stories like Terra Heinz-Kerry earning $5 million a year through her investments in tax-free municipal bonds, they think thats only for the super rich. The truth is that it takes a decade or two (or maybe even a few generations) to achieve that sort of wealth. But with proper saving, planning and investing you (or maybe your kids) can live well of your investments. So how much do you need to be able to live off your investments? The first step is to decide how much you need to live on. Lets suppose you need around $50,000 to pay your living expenses. Assuming that tax-free municipal bonds (or government treasuries) pay 5% per year, youâ€ll need a portfolio of $1million. Dollar Value of Portfolio = Required Dividend Amount / Dividend Yield of the Portfolio If you havenâ€t saved up a million dollars yet, this might seem like a far fetched scheme. But if you start saving today and invest wisely, in a few years youâ€ll at least be supplementing your income. Eventually you should be able to retire in style. There are several ways to get more than the lousy 5% yield that your bank gives you. You should ideally try to get 12% return, since at 5% youâ€re barely beating inflation. This may not be possible every year, but should be for most. [Note: the average yield for the stock market is around 7-8%. It is not 11.8% as commonly mentioned. Source: Ben Steinâ€s excellent book Yes, You Can Time the Market] One way is to invest in companies that pay a dividend and have historically kept increasing their dividend every year. Even though you might get only 2.5% return today, eventually with the increase in stock price and rise in dividends, your annual return should be greater than 12%. Altria, Coke, Procter and Gamble are some stocks that fit this criteria. Other alternatives are energy utilites and natural resource stocks, REITs and Canadian Income Trusts. Investments in real estate can also yield 10-12% with potential for appreciation but these require a large investment (typically over $50,000). You also need to be aware of market cycles and might need to take an active role in the management. But with consistent earnings, savings and investing you should be able to live off your dividends."
- knowledgeself rated 5 months ago
- interesting stuff
- blackysky rated 5 months ago
- From the page: "So how much do you need to be able to live off your investments?"
- axe85 rated 5 months ago
- ok except he spelled altria wrong (wrote altris). and not very informative....
- onlineoverlord rated 5 months ago
- uhh
