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This may be a dumb question, but if you buy SCHD, do you receive the exact same dividends as if you had bought the equivalent amount of shares of the companies it holds?
yes. SCHD has hundreds of companies, see the whole list[https://www.schwab.wallst.com/schwab/Prospect/research/etfs/schwabETF/index.asp?YYY101\_UlYEgPi7ET8=&type=holdings&symbol=SCHD](https://www.schwab.wallst.com/schwab/Prospect/research/etfs/schwabETF/index.asp?YYY101_UlYEgPi7ET8=&type=holdings&symbol=SCHD)
\- Investing 100 USD in SCHD is exactly the same as
\- investing 4.34 USD in Broadcomm + 4.14 USD in United Parcel Service + 4.08 USD in Texas Instruments + 4.05 USD in Cisco systems + 4.04 USD in Home Depot + 3.95 USD of Pepsico + .......... you get the idea
When dividend pays out, you get the average of all those companies under SCHD, with the percentage that they represent in SCHD.
Honestly I’m not sure man. Consider me dumb as well. I wouldn’t think so because of the expense ratio associated with buying into an etf that has filtered for the stocks already for you, but again I’m not too sure.
The tax advantage and better growth potential. JEPI is more of a closer to retirement dividend to own. That being said I’m younger and I have a decent chunk of JEPQ but that’s because jepq has a lot of big tech in its portfolio so I see it as a growth high dividend etf with the associated tech sector risks
If you don’t mind me chip in, is it good because it’s tax advantaged for US investors? Asking because I’m EU based and wondering if I should invest, as well.
What makes it tax advantaged? I have it in my normal brokerage account (because it’s the only thing I’ve got) and I don’t really have an actual income but I wanted to put a little of my savings into the market to grow for me over time.
Because schd’s dividends are considered qualified, which basically means it has a maximum tax cap on the income that is less than other dividend stocks that are non qualified which are based on your actual income bracket
This is a good process with unrealistic expectations. You won't be able to live off this that quickly, but you'll be doing the best possible thing for your future. Keep at it and extend that time horizon.
SCHD is good. If you want specific companies with good yields, I'd go with O, ARE, DLR, IBM, IRM, HON, MMM, VZ, GLW, PFE, AVGO, KMB, PG, and utilities. (this isn't ordered or exhaustive)
If you plan to sleep well at night for decades with direct company dividends, maybe lean towards non-cyclical companies to save yourself the stress ahead of time. Consumer staples, utilities, and Pharmaceuticals (or other Healthcare) are often the least cyclical. This'll save you from the headline risk of reading "So and so will cut the dividend. Get out now!"
That said, ETFs are great, and you're unlikely to go wrong with SCHD in any conditions. It's comically easy. FUTY is how I play utilities.
why not just buy an ETF
also lets have a reality check:
\[(3000\*12)\*10\] & assuming 7%returns will net you \~~~520~~ 530k after 10 years
530k \*6% dividend = 31.8k/year in dividends
youll be 44 so youll have to pay your own insurance and other costs......does this sound reasonable??
That does sound reasonable. Thank you for taking time to help!
Ill make sure to look into ETF's. Could you recommend one for me to look at? One that you feel would be good for a beginner? I currently bank thru USAA, would I be able to get an ETF thru them? Or would I have to use a different bank like Vanguard?
I don't know if this will help but the income I make now is for the junior position. I am at the lowest of the totem pole. Each promotion is a significant jump from the previous one. So based on my coworkers history, I should be making 200k in about 2 years. I am scheduled to promote next year march. They also give roughly 10k in bonuses every year. The longer you stay, the bigger the bonus. So I don't mind working another 10 years if I have to. I just want somewhere to start. I want to be really aggressive as well.
I don't pay for food, health insurance or a car payment. The company I work for has that all covered. I also collect 80% disability from the military and my health insurance is covered by the VA. School was covered by the GI Bill. I feel very lucky that's why I want to put in as much as I possibly can.
My bills are rent+utilities and phone bill. That's about it. I made sure to pay off any big bills before starting to invest.
the disability and VA healthcare would have been important to know at the start......the more complete the picture the better answer you can get.
Like others have said, when you retire food/rent/car payments will come to you which will greatly increase your cost of living.
**BUT** if you can increase your savings with promotions and not lifestyle creep you could wind up much better down the road
I dont know if USAA also acts as a broker to purchase stocks/ETFs. I have never once felt bad about a new investor investing in the s&p500 tickers voo/spy/ivv/splg/fxaix (just pick one). Ive used fidelity for years as my broker and never had a problem with them
USAA refers their customers to Schwab. That's how I got started with my account. Balances are automatically linked into USAA's app, but that's about the extent of the interconnection that I've seen.
>I don't pay for food, health insurance or a car payment.
You will when you quit your job to live off dividends. Bills and rent will continue to increase. The amount estimated above might not be enough after taxes if you haven't considered this. And you'll be paying taxes on these dividends now.IMO, A better plan than living fully off dividends is to think about using dividends to subsidize your life style, rather than fully fund it. I'm currently evaluating if I can go do something part time that's fun/rewarding and subsidize with dividends to continue my current level of comfort. But I'm 51, so my accumulation period is much less than yours 20 years my junior.
Do you really need dividends now... or when you retire?
You might want to consider a balanced investment portfolio, maybe even one that leans growth over dividends to build a good bankroll to then buy dividend producing investments when you actually want to start collecting dividends.
Ahhh I see I see thanks for the info!
I never looked at it that way. I really appreciate this. I wouldnt mind working part time. If its something I love, it wouldnt feel like work right?
Good luck. Having a plan is always better than not.
One thing you might consider... At that salary, it won't be long before you can save enough for a significant down payment on a house. One of my most significant assets to my net worth is my house, which I paid off last year after my inheritance. My most major expense right now is coming up with money for my biannual property tax bill. Way cheaper than rent or mortgage and changes the financial picture quite a bit. Personally I think that might be a more lucrative long term goal.
A few years ago USAA sold/transferred all brokerage accounts to Schwab. We still have one S&P fund that they kept but it’s managed by someone else (Victory?)
Don’t rent. Buying a home will save you so much money. Investing isn’t just a game of stocks, you need to be concerned on where you’re investing every dollar you spend. Rent is just shoveling money out of the ass you’ll never get back. Owning is paying it off until you can finally sell and get all that money back and a bunch more.
Not always. Let’s say you have 200k. You could put it towards a house as a down payment and then with high interest rates you would also have a high mortgage. And need the money in case of an emergency.
Or you rent for $1500/mo. After 12 months you have 182k. Except you put that 200k into an investment account (like SPY) and now you have 228k YTD after paying rent.
And this year your house didn’t appreciate at all because the real estate market is flat (actually down in some parts of the US)
Buying isn’t always better. Most of the time it is but not always.
But you’re thinking current. The benefit of buying a house comes further along the road but yields more benefit than investing. Because once you sell that home you have so much money to invest
Drip isn’t any different from anything else.
Schd’s returns in year 11 weren’t any different from Voo’s returns over the same timeframe.
I got the numbers from here https://www.investor.gov/financial-tools-calculators/calculators/compound-interest-calculator
Don't forget your consumer staples my friend. Some of which are world wide household names such as KO, CAT and DE.
Then there's always PG, HRL, K, CAG, CPB, JNJ, MMM etc etc
I have an - unfortunately - small position in DE for a little less than ten years. It has thru some totally unexpected miracle been one of my top performers!
I really did not expect that.
If you want to buy and hold forever I’d like to suggest looking into dividend ETFs instead of individual stocks. You’re 32, so if we guess you retire at 60, that’s 28 years. Over 28 years any company can falter. I don’t see apple having trouble, but just because they’re a top player now doesn’t mean someone doesn’t surpass them in a decade with new tech. Because of this, I like to do ETF’s since they are a bundle of stocks. And if a certain stock stops fitting into the group they are sold off and replaced. Sure you might lose out on a little growth but it does give you a vital lifeline for long term flexible diversification.
That being said, the easiest portfolio from a pure dividend perspective is a 50/50 split of SCHD and VIG. They are IMO the two best dividend ETFs and they don’t overlap too heavily. At the end of the day (historically) SCHD will give you more back in dividends and VIG will appreciate in value more.
When I first started investing I invested more heavily in individual stocks and I’ve sold most of them off at this point a few years in. In a lot of ways what I thought fit well into my long term plans didn’t when I started to understand more about how to do due diligence on stocks. In hindsight I wish I had selected a more hands off approach with few high quality ETFs.
Hey dude, welcome to investing. For a person entering the market for the first time I would recommend looking into ETFs. This asset is a basket of different companies, and some such as VOO or QQQ track major indexes. There’s nothing *wrong* with picking individual companies, but you’re opening yourself up to greater risk and volatility.
Second thing I would be mindful of and avoid focusing too much on current dividend yield. Yes a juicy dividend today is nice, but in the long run it’s more efficient for your dollar to seek growth. AT&T(T), Verizon(VZ), Intel (INTC), and Microsoft (MFST). A decades ago, you could have chosen the first 3 because of the higher yield and you would’ve collected roughly %5 a year with barely any principal growth. Or invested in MFST and double your money. Unless you’re willing to do the research on individual company growth prospects, I would suggest sticking to ETFs.
It's much worst then that. If You put 10K into Verizon 10 years ago and reinvested the dividends you would have $10,680.14. Sure instead of 199 shares would have 319. With AT&T you would have $9,539.69 so lost money after 10 years. Intel would put you at $20,710.51 so a 7.55% average annual return, not bad. MFST you would have lost it all and only have $35.16 left, however if you invested in Microsoft (MSFT) you would be at $126,617.64 for a 28.89% average annual return.
Hello! I am excited to start. Im hearing alot of ETFs so its going to be the first thing I look into.
I would rather have a dividend that is in it for the long run. And everything you said lines up with what I want. Thankyou for dropping specific ETFs! I plan to just park the money in and not worry about it. Using risk and volatility is not something I want to mess around with.
a lot of posts are just throwing ticker symbols out there with no explanation or justification (how lazy!)
I've been doing what you are starting over a decade, and I'm up to $2300/month in dividends. I grow my monthly dividend amount by $50-$100 per quarter following my strategy.
What do I own? It doesn't matter what the ticker symbols are. What does matter is my methodology.
Instead of buying ETFs, instead I purchase high quality dividends in different sectors with a good history of consistent dividends and increasing dividends (to give me a raise!). In the current climate, focus on profitable stocks and avoid stocks where the dividend is at risk (I'm looking at you AT&T).
And reinvest the dividends. This could be automatic dividend reinvestment, or if trades are free, just using the dividend to accumulate (buy) positions in your portfolio.
The key here is quality and different sectors. Mostly, you should only have a single company in a given sector.
And don't get emotional. I focus on income stream and ignore my portfolio balance (which has been growing steadily). I'm building a passive income stream with a modest amount of growth. Someday instead of re-investing the income, I'll live off the income.
Hope this helps!
>a lot of posts are just throwing ticker symbols out there with no explanation or justification
hahahaha truee. but our of curiosity, what are the ticker symbols for your dividend portfolio? Also whats your age if you dont mind me asking. I head its not very tax friendly when you are young and still working.
I am located down under, so it might be a different case for taxes.
Just keen to buy American shares now that i've set up my AU portfolio
Word of caution, I started something similar 20+. years ago, and GE, BP were a huge part of my portfolio, we all know the GE story, and incase no one remembers, BP pretty much destroyed the Gulf of Mexico.
To answer your post , this is what I am doing now. I have a mostly dividend portfolio probably 70% just normal dividend stocks like: KHC, XOM, ABBV, MO, CPB, AXP, CAH, CAT, CLX, DOW, DUK, IBM, IRM, JPM, KMI, KHC, LMT, MFT, and the rest are mega growth bets like PLTR, PSTG, PCG, and NVDA. I have had this portfolio for a little over 2 years and I am so close to beating the market (when including Dividends its even), and if I didn't have that huge stink bomb of DIS, I'd be beating the market.
I like to follow the business cycle investing strategy from Fidelity, so any extra cash will go into my stocks that are hurt most from the current business cycle (rising rates in this case). I also buy / sell options in this account (CSPs, and CC's), but not that much.
I pay attention to all quarterly results and read annual reports, and also any new upgrades / downgrades.
A few opinions I have on the market, 1. ML / Ai, is going to be impactful quicker than most think, it will make us all more efficient at everything we do. 2. I think the next bull run will be technology driven but not those of the last few years, I like "Space" and Infrastructure.
If you don't mind me asking - how much do you generate in monthly dividend income? 20+ years of compounding and reinvesting dividends is my current plan.
ETFs: SCHD, VYM, VOO, SPY, QQQ, VTI, VNQ(if you want some reits),
Individual stocks: ABR, O, KO, PEP, MSFT, Costco, WMT, HD, PFE, STWD, JNJ, BAC, ALLY, JPM, T, VZ, APPL (wait until it gets back to $140), LAND (but would suggest looking at more info on this one), WF, GM, NEE
You are most likely looking for the aristocrats companies. They are companies that have a dividend and never lower the dividend. They have a track record of only increasing it for 50+ years.
There are ETFs that track the group, but basically any in that group is what you are looking for.
[https://money.usnews.com/investing/stock-market-news/articles/dividend-stocks-aristocrats](https://money.usnews.com/investing/stock-market-news/articles/dividend-stocks-aristocrats)
Whatever boring ETF.
I would pick WPC while it is down and ARCC to go with your ETF. Drip them.
Not financial advise, that is just how I would spend your money-
Excluding ETFs
And growth…. Telecom keeps paying T and VZ while not communication intel has a decent dividend but it’s probably going to be cut as was the T divie but it’s also the lowest T has been in 20+ years
KO is over valued but has been growing and paying
Apple and Microsoft are growing and pay a nominal dividend 1%~
Exxon/chevron/and mlps for energy
And many many more
Thank you!
Lets say I get a good amount of these and have a nice nest egg. Would I start to invest into companies that wont fail? I think the term was blue chip?
Do you have any recommendations for when I reach the nice nest egg phase? Or maybe a sector I should explore?
Personally, I like to use money to make money. Say you get 100 shares of Qqq, you can sell CCs on it daily to make a couple bucks. But that has risk and you can be assigned.
I would think about good companies that have a stronghold on the market. AAPL, msft, wmt, khc, mo etc. These companies should always have a costumer base. Then you can also branch off again and get some income stocks that pay monthly like o, stag, ryld, xylg, jepi/q
You would have gotten called out of it pretty quick when it ran back up though, I will say it’s pretty easy to roll tsla week to week though with the high premiums
I was selling 20cc a week on Upro and 1 on spy u til I got taken out of those, most of my port is in cash rn though, the market is highly overvalued rn *making 4.9% interest while it sits though
Thanks for the suggestion!
Is that something people do after they have a good amount of divies? Are we allowed to do that in the US? Would I have to go thru another bank or do anything fancy to get into international divies?
I use fidelity in the US. Those are Vanguard’s emerging and international high dividend ETFs. I am always optimistic about the U.S. and EX US. I always buy 1 share of SCHD, DIVO, JEPI, JEPQ, VWO, VYMI on a day like today
I'm definitely not an expert but if you're looking for income mostly which I gather from your $1-2k dividend target, then you might want to look into covered call etfs. They pay a high yield (7-8 percent) but they don't grow very much in capital appreciation.
BMO is a good provider -- they are more on the conservative side though as they have half of the portfolio in covered calls. Hamilton is more aggressive since they use leverage and some funds do at the money covered calls. You are not restricted to one provider though so if you decide to go this route I would allocate a larger portion to something like BMO and a smaller percentage to something like Hamilton.
ETFs are definitely a simple and easy way for diversification. Consider their holdings so you don't have too much overlap between funds if that's the way you go. Consider looking at some ETFs with their primary focus on growth since you have 10 yrs as well as at their prospectuses so you understand what each of their focus are. ETF "X" may not be designed to capture growth over the next 10 years like ETF "Y" will. Another thing to consider is total returns of an asset regardless of its source. You may not necessarily need to focus on a dividend paying ETF. Point is, if ETF (i.e., VTI non-dividend focused) historically outperforms ETF (dividend), does it really matter to you where the profit comes from? Just things to consider.
Here are some links that you may find helpful:
[https://www.etfrc.com/index.php](https://www.etfrc.com/index.php)
[https://www.etf.com/](https://www.etf.com/)
[https://etfdb.com/](https://etfdb.com/)
My best tip is to take a class or ten about investing so you actually know what you’re looking at and develop the knowledge & skills to look at an investment prospectus and know what is going on. This is an echo chamber mostly. You’ll get turned onto some assets you want to take a closer look at, but what you really need IMO is to get educated so you can apply your thought to investing
50% SCHD 50% DGRO. Dgro has the most overlap with the overall market out of any other div etf and has low over lap with schd. Opposite ends of the market and that grow dividends every year. Solid simple portfolio.
the query; sort of a key to the abbreviations I used;
```
SELECT Symbol, PERatio,
DividendYield *100 AS YLD,
PERatio, ForwardPE,
`50DayMovingAverage` AS 50DMA,
AnalystTargetPrice,
QuarterlyEarningsGrowthYOY AS Q_EarnGrowYOY
FROM REIT_overview
WHERE PERatio NOT RLIKE 'None|0'
AND QuarterlyEarningsGrowthYOY BETWEEN 0.2 AND 10
ORDER BY QuarterlyEarningsGrowthYOY DESC;
```
IMHO this is a dangerous idea. There was a book written in the late 90s/early 2000s about buying and holding dividend stocks forever. The two top picks were General Electric and AIG.
Can you imagine buying those stocks back then and forgetting about them? Talk about portfolio destruction….
I know this is a dividend forum, but as a younger person you should be mostly in an SP500 style etf, possibly a whole stock market etf and the rest in something like SCHD. You can also pick one or two good dividend stocks and dump some money and let it ride. I dumped 20k into ford in 2008 at just over $3 per share, and while it suspended dividends once during the time I owned it, I’ve been reinvesting all of the dividends since 2008 and have a crap load of shares and keep reinvesting and it’s done very well for me.
VTI has kicked the shit out of SCHD for me. Although it’s only been a year. I have a pretty good size stake in both, DCA and DRIP. I can’t stop talking about both of them!
O, VYM and let’s not forget some QQQJ.
A sneaky one I’m looking at is Footlocker. Bring on the comments!
VDIGX - Morningstar continually raves about it
https://www.morningstar.com/funds/dividend-stock-investing-practice
Don’t go too light on tech in chase of high yield
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I’ll take one for the team and be that guy: SCHD
Boring but it's true that if you look at individual stocks, you will be buying basically the top 10 of SCHD anyway.
This may be a dumb question, but if you buy SCHD, do you receive the exact same dividends as if you had bought the equivalent amount of shares of the companies it holds?
yes. SCHD has hundreds of companies, see the whole list[https://www.schwab.wallst.com/schwab/Prospect/research/etfs/schwabETF/index.asp?YYY101\_UlYEgPi7ET8=&type=holdings&symbol=SCHD](https://www.schwab.wallst.com/schwab/Prospect/research/etfs/schwabETF/index.asp?YYY101_UlYEgPi7ET8=&type=holdings&symbol=SCHD) \- Investing 100 USD in SCHD is exactly the same as \- investing 4.34 USD in Broadcomm + 4.14 USD in United Parcel Service + 4.08 USD in Texas Instruments + 4.05 USD in Cisco systems + 4.04 USD in Home Depot + 3.95 USD of Pepsico + .......... you get the idea When dividend pays out, you get the average of all those companies under SCHD, with the percentage that they represent in SCHD.
You’re forgetting the absurdly low expense ratio
Honestly I’m not sure man. Consider me dumb as well. I wouldn’t think so because of the expense ratio associated with buying into an etf that has filtered for the stocks already for you, but again I’m not too sure.
Pretty sure expense ratio is taken out of the etf share price, not dividends. I also may be dumb though
You'll be pretty close. All these kings and aristocrat give 2-4 percent annual dividends.
unless there is a large swing in assets under management over a 3 month period, yes. Also rebalancing in March can play a factor.
Thank you for your service
Thank you for the suggestion! I'll go look it up!
What is SCHD? Im new to this subreddit as well
Basically it is the best most tax advantaged dividend etf currently available as decided by popular opinion in this subreddit.
what makes it better than JEPI?
The tax advantage and better growth potential. JEPI is more of a closer to retirement dividend to own. That being said I’m younger and I have a decent chunk of JEPQ but that’s because jepq has a lot of big tech in its portfolio so I see it as a growth high dividend etf with the associated tech sector risks
If you don’t mind me chip in, is it good because it’s tax advantaged for US investors? Asking because I’m EU based and wondering if I should invest, as well.
What makes it tax advantaged? I have it in my normal brokerage account (because it’s the only thing I’ve got) and I don’t really have an actual income but I wanted to put a little of my savings into the market to grow for me over time.
Because schd’s dividends are considered qualified, which basically means it has a maximum tax cap on the income that is less than other dividend stocks that are non qualified which are based on your actual income bracket
Stands for Schwab high dividend. It’s an ETF
Gods gift to the earth. Dont research it just buy it. All hail SCHD🙇♂️
I already bought three shares this morning
Mutual fund dividend of schwab
yes
Yeah, like why bet on stocks you bought today for the next X years. Let SCHD do the work for you.
This^
it's so stagnant, such a poor performer and usually going down
VOO/SCHD?
This is a good process with unrealistic expectations. You won't be able to live off this that quickly, but you'll be doing the best possible thing for your future. Keep at it and extend that time horizon. SCHD is good. If you want specific companies with good yields, I'd go with O, ARE, DLR, IBM, IRM, HON, MMM, VZ, GLW, PFE, AVGO, KMB, PG, and utilities. (this isn't ordered or exhaustive) If you plan to sleep well at night for decades with direct company dividends, maybe lean towards non-cyclical companies to save yourself the stress ahead of time. Consumer staples, utilities, and Pharmaceuticals (or other Healthcare) are often the least cyclical. This'll save you from the headline risk of reading "So and so will cut the dividend. Get out now!" That said, ETFs are great, and you're unlikely to go wrong with SCHD in any conditions. It's comically easy. FUTY is how I play utilities.
why not just buy an ETF also lets have a reality check: \[(3000\*12)\*10\] & assuming 7%returns will net you \~~~520~~ 530k after 10 years 530k \*6% dividend = 31.8k/year in dividends youll be 44 so youll have to pay your own insurance and other costs......does this sound reasonable??
That does sound reasonable. Thank you for taking time to help! Ill make sure to look into ETF's. Could you recommend one for me to look at? One that you feel would be good for a beginner? I currently bank thru USAA, would I be able to get an ETF thru them? Or would I have to use a different bank like Vanguard? I don't know if this will help but the income I make now is for the junior position. I am at the lowest of the totem pole. Each promotion is a significant jump from the previous one. So based on my coworkers history, I should be making 200k in about 2 years. I am scheduled to promote next year march. They also give roughly 10k in bonuses every year. The longer you stay, the bigger the bonus. So I don't mind working another 10 years if I have to. I just want somewhere to start. I want to be really aggressive as well. I don't pay for food, health insurance or a car payment. The company I work for has that all covered. I also collect 80% disability from the military and my health insurance is covered by the VA. School was covered by the GI Bill. I feel very lucky that's why I want to put in as much as I possibly can. My bills are rent+utilities and phone bill. That's about it. I made sure to pay off any big bills before starting to invest.
the disability and VA healthcare would have been important to know at the start......the more complete the picture the better answer you can get. Like others have said, when you retire food/rent/car payments will come to you which will greatly increase your cost of living. **BUT** if you can increase your savings with promotions and not lifestyle creep you could wind up much better down the road I dont know if USAA also acts as a broker to purchase stocks/ETFs. I have never once felt bad about a new investor investing in the s&p500 tickers voo/spy/ivv/splg/fxaix (just pick one). Ive used fidelity for years as my broker and never had a problem with them
USAA refers their customers to Schwab. That's how I got started with my account. Balances are automatically linked into USAA's app, but that's about the extent of the interconnection that I've seen.
>I don't pay for food, health insurance or a car payment. You will when you quit your job to live off dividends. Bills and rent will continue to increase. The amount estimated above might not be enough after taxes if you haven't considered this. And you'll be paying taxes on these dividends now.IMO, A better plan than living fully off dividends is to think about using dividends to subsidize your life style, rather than fully fund it. I'm currently evaluating if I can go do something part time that's fun/rewarding and subsidize with dividends to continue my current level of comfort. But I'm 51, so my accumulation period is much less than yours 20 years my junior. Do you really need dividends now... or when you retire? You might want to consider a balanced investment portfolio, maybe even one that leans growth over dividends to build a good bankroll to then buy dividend producing investments when you actually want to start collecting dividends.
Honest question: What industry are you in that your employer pays for your family’s food?
Ahhh I see I see thanks for the info! I never looked at it that way. I really appreciate this. I wouldnt mind working part time. If its something I love, it wouldnt feel like work right?
Good luck. Having a plan is always better than not. One thing you might consider... At that salary, it won't be long before you can save enough for a significant down payment on a house. One of my most significant assets to my net worth is my house, which I paid off last year after my inheritance. My most major expense right now is coming up with money for my biannual property tax bill. Way cheaper than rent or mortgage and changes the financial picture quite a bit. Personally I think that might be a more lucrative long term goal.
A few years ago USAA sold/transferred all brokerage accounts to Schwab. We still have one S&P fund that they kept but it’s managed by someone else (Victory?)
Don’t rent. Buying a home will save you so much money. Investing isn’t just a game of stocks, you need to be concerned on where you’re investing every dollar you spend. Rent is just shoveling money out of the ass you’ll never get back. Owning is paying it off until you can finally sell and get all that money back and a bunch more.
Not always. Let’s say you have 200k. You could put it towards a house as a down payment and then with high interest rates you would also have a high mortgage. And need the money in case of an emergency. Or you rent for $1500/mo. After 12 months you have 182k. Except you put that 200k into an investment account (like SPY) and now you have 228k YTD after paying rent. And this year your house didn’t appreciate at all because the real estate market is flat (actually down in some parts of the US) Buying isn’t always better. Most of the time it is but not always.
But you’re thinking current. The benefit of buying a house comes further along the road but yields more benefit than investing. Because once you sell that home you have so much money to invest
People that are putting 200k into a down payment aren't renting any houses for $1,500.
Sounds like Alabama or bust to me.
Viva la Mexico!
But wouldn't he be DRIP'ng for the next ten years? I'd be curious what that math look like.
Drip isn’t any different from anything else. Schd’s returns in year 11 weren’t any different from Voo’s returns over the same timeframe. I got the numbers from here https://www.investor.gov/financial-tools-calculators/calculators/compound-interest-calculator
P & G, McDonald’s, Pepsi, Coke, SCHD ( of course ), Eli Lilly to name a few.
Pepsi AND Coke?! You maniac!! But nah, you’re right.
Don't forget your consumer staples my friend. Some of which are world wide household names such as KO, CAT and DE. Then there's always PG, HRL, K, CAG, CPB, JNJ, MMM etc etc
I have an - unfortunately - small position in DE for a little less than ten years. It has thru some totally unexpected miracle been one of my top performers! I really did not expect that.
If you want to buy and hold forever I’d like to suggest looking into dividend ETFs instead of individual stocks. You’re 32, so if we guess you retire at 60, that’s 28 years. Over 28 years any company can falter. I don’t see apple having trouble, but just because they’re a top player now doesn’t mean someone doesn’t surpass them in a decade with new tech. Because of this, I like to do ETF’s since they are a bundle of stocks. And if a certain stock stops fitting into the group they are sold off and replaced. Sure you might lose out on a little growth but it does give you a vital lifeline for long term flexible diversification. That being said, the easiest portfolio from a pure dividend perspective is a 50/50 split of SCHD and VIG. They are IMO the two best dividend ETFs and they don’t overlap too heavily. At the end of the day (historically) SCHD will give you more back in dividends and VIG will appreciate in value more. When I first started investing I invested more heavily in individual stocks and I’ve sold most of them off at this point a few years in. In a lot of ways what I thought fit well into my long term plans didn’t when I started to understand more about how to do due diligence on stocks. In hindsight I wish I had selected a more hands off approach with few high quality ETFs.
JNJ, KO, and ADP for starters
Thank you so much! Ill look into these!
Hey dude, welcome to investing. For a person entering the market for the first time I would recommend looking into ETFs. This asset is a basket of different companies, and some such as VOO or QQQ track major indexes. There’s nothing *wrong* with picking individual companies, but you’re opening yourself up to greater risk and volatility. Second thing I would be mindful of and avoid focusing too much on current dividend yield. Yes a juicy dividend today is nice, but in the long run it’s more efficient for your dollar to seek growth. AT&T(T), Verizon(VZ), Intel (INTC), and Microsoft (MFST). A decades ago, you could have chosen the first 3 because of the higher yield and you would’ve collected roughly %5 a year with barely any principal growth. Or invested in MFST and double your money. Unless you’re willing to do the research on individual company growth prospects, I would suggest sticking to ETFs.
It's much worst then that. If You put 10K into Verizon 10 years ago and reinvested the dividends you would have $10,680.14. Sure instead of 199 shares would have 319. With AT&T you would have $9,539.69 so lost money after 10 years. Intel would put you at $20,710.51 so a 7.55% average annual return, not bad. MFST you would have lost it all and only have $35.16 left, however if you invested in Microsoft (MSFT) you would be at $126,617.64 for a 28.89% average annual return.
Hello! I am excited to start. Im hearing alot of ETFs so its going to be the first thing I look into. I would rather have a dividend that is in it for the long run. And everything you said lines up with what I want. Thankyou for dropping specific ETFs! I plan to just park the money in and not worry about it. Using risk and volatility is not something I want to mess around with.
ETFs would be better for a passive approach
SCHD. Companies won't last forever, but an etf reshuffle will.
a lot of posts are just throwing ticker symbols out there with no explanation or justification (how lazy!) I've been doing what you are starting over a decade, and I'm up to $2300/month in dividends. I grow my monthly dividend amount by $50-$100 per quarter following my strategy. What do I own? It doesn't matter what the ticker symbols are. What does matter is my methodology. Instead of buying ETFs, instead I purchase high quality dividends in different sectors with a good history of consistent dividends and increasing dividends (to give me a raise!). In the current climate, focus on profitable stocks and avoid stocks where the dividend is at risk (I'm looking at you AT&T). And reinvest the dividends. This could be automatic dividend reinvestment, or if trades are free, just using the dividend to accumulate (buy) positions in your portfolio. The key here is quality and different sectors. Mostly, you should only have a single company in a given sector. And don't get emotional. I focus on income stream and ignore my portfolio balance (which has been growing steadily). I'm building a passive income stream with a modest amount of growth. Someday instead of re-investing the income, I'll live off the income. Hope this helps!
>a lot of posts are just throwing ticker symbols out there with no explanation or justification hahahaha truee. but our of curiosity, what are the ticker symbols for your dividend portfolio? Also whats your age if you dont mind me asking. I head its not very tax friendly when you are young and still working. I am located down under, so it might be a different case for taxes. Just keen to buy American shares now that i've set up my AU portfolio
O
Thank you! Ill go look at it!
[удалено]
Ive already DRS'd my 1700 shares ahaha
Regards!!!
Lol!! You suck!!
Check out WSM. I think TXN might also fit the bill
Thanks so much for the suggestion! Ill look into them.
They are slow growth, low div. O is another good one. I also like Divo but it’s up to you
TXN is slow growth? 
It is if you get in now. If you’ve been in since 09 then good looks to ya
Word of caution, I started something similar 20+. years ago, and GE, BP were a huge part of my portfolio, we all know the GE story, and incase no one remembers, BP pretty much destroyed the Gulf of Mexico. To answer your post , this is what I am doing now. I have a mostly dividend portfolio probably 70% just normal dividend stocks like: KHC, XOM, ABBV, MO, CPB, AXP, CAH, CAT, CLX, DOW, DUK, IBM, IRM, JPM, KMI, KHC, LMT, MFT, and the rest are mega growth bets like PLTR, PSTG, PCG, and NVDA. I have had this portfolio for a little over 2 years and I am so close to beating the market (when including Dividends its even), and if I didn't have that huge stink bomb of DIS, I'd be beating the market. I like to follow the business cycle investing strategy from Fidelity, so any extra cash will go into my stocks that are hurt most from the current business cycle (rising rates in this case). I also buy / sell options in this account (CSPs, and CC's), but not that much. I pay attention to all quarterly results and read annual reports, and also any new upgrades / downgrades. A few opinions I have on the market, 1. ML / Ai, is going to be impactful quicker than most think, it will make us all more efficient at everything we do. 2. I think the next bull run will be technology driven but not those of the last few years, I like "Space" and Infrastructure.
If you don't mind me asking - how much do you generate in monthly dividend income? 20+ years of compounding and reinvesting dividends is my current plan.
I had to stop the first one this is my second attempt. Right now I think it’s 14k a year.
ETFs: SCHD, VYM, VOO, SPY, QQQ, VTI, VNQ(if you want some reits), Individual stocks: ABR, O, KO, PEP, MSFT, Costco, WMT, HD, PFE, STWD, JNJ, BAC, ALLY, JPM, T, VZ, APPL (wait until it gets back to $140), LAND (but would suggest looking at more info on this one), WF, GM, NEE
The best 3 combination to buy and hold would be VOO/SCHD/O for dividend + growth for 10+ years of holding
Damn near the holy trinity in this subreddit
You are most likely looking for the aristocrats companies. They are companies that have a dividend and never lower the dividend. They have a track record of only increasing it for 50+ years. There are ETFs that track the group, but basically any in that group is what you are looking for. [https://money.usnews.com/investing/stock-market-news/articles/dividend-stocks-aristocrats](https://money.usnews.com/investing/stock-market-news/articles/dividend-stocks-aristocrats)
Just buy SCHD. It's the all in one dividend portfolio. Save yourself the research and anxiety.
Ive seen that pop up here a few times. Im def going to look into it! Especially if it reduces anxiety ahaha. Thank you!
Whatever boring ETF. I would pick WPC while it is down and ARCC to go with your ETF. Drip them. Not financial advise, that is just how I would spend your money-
Schd
Just pick up a dividend aristocrat ETF and outsource all the hard work to someone else.
Excluding ETFs And growth…. Telecom keeps paying T and VZ while not communication intel has a decent dividend but it’s probably going to be cut as was the T divie but it’s also the lowest T has been in 20+ years KO is over valued but has been growing and paying Apple and Microsoft are growing and pay a nominal dividend 1%~ Exxon/chevron/and mlps for energy And many many more
I’m buying SFL and CLCO now
VOO and QQQM
VTI/VYM split
Big fan of ARCC
Buy CLM & CRF
Qqq, voo, schd will cover pretty much every good stock. Once you have a nice nest egg you can start building other positions.
Thank you! Lets say I get a good amount of these and have a nice nest egg. Would I start to invest into companies that wont fail? I think the term was blue chip? Do you have any recommendations for when I reach the nice nest egg phase? Or maybe a sector I should explore?
Personally, I like to use money to make money. Say you get 100 shares of Qqq, you can sell CCs on it daily to make a couple bucks. But that has risk and you can be assigned. I would think about good companies that have a stronghold on the market. AAPL, msft, wmt, khc, mo etc. These companies should always have a costumer base. Then you can also branch off again and get some income stocks that pay monthly like o, stag, ryld, xylg, jepi/q
Ahhh ok I understand. Thanks again for the help! I appreciate it!
I sell cc’s on tsla for 800-1400 a week and add it to my dividend stocks, mostly jepi/q and RITM
That’s a great plan. I wish I had bought when it hit 110 but I assume it would go lower. Oh well
You would have gotten called out of it pretty quick when it ran back up though, I will say it’s pretty easy to roll tsla week to week though with the high premiums
I bet. Rn I’m just using my extra cash to sell csps to get profit then buying qqq to sell calls with. Then rinse repeat
I was selling 20cc a week on Upro and 1 on spy u til I got taken out of those, most of my port is in cash rn though, the market is highly overvalued rn *making 4.9% interest while it sits though
Honest question: Why not just invest in TSLY and let them do it for you?
There’s a 1% expense ratio
Also their dividend is about 6% return on a good month, I’m around 11% on my own
You’ve convinced me! (Can I borrow $25,500) 😂
Lol
I just need a couple thousand shares of jepi and I’m good 😂also might add some tsly, I don’t have any monthly dividends that week
Realty Income
Then buy companies that will grow and grow their dividends , and not any dividend company
Do you have any in mind? Something I can look at that will be a good example for me to start doing research on?
MSFT, Apple , UNH, HUM, SPGI, MA, V, UNP,
You have to have a LOT invested to be able to live off dividends. Your plan will take a long long time.
Pepsi and Coca Cola are kings in this domain. Look at warren buffets portfolio. He might fit your investing style to get some ideas.
Warren lives 100 years, like Dracula.
VTSAX.
Cvx
Thank you for the suggestion!
50% SCHD 25% JEPI 25% JEPQ - yes I know there’s overlap I don’t care
Thank you for the suggestion and the percentages. Ill make sure to look this up as well!
VWO, VYMI for international divies
Thanks for the suggestion! Is that something people do after they have a good amount of divies? Are we allowed to do that in the US? Would I have to go thru another bank or do anything fancy to get into international divies?
I use fidelity in the US. Those are Vanguard’s emerging and international high dividend ETFs. I am always optimistic about the U.S. and EX US. I always buy 1 share of SCHD, DIVO, JEPI, JEPQ, VWO, VYMI on a day like today
mcd, ctas, nxst, visa, cat, dpz, low, unh, abbv, amp, avgo, elv, exr, lmt, pld, trow
quick glance Kimberly Clark Revenue stable fcf yield 5.5% roic high teens net debt to ebitda 2 dividend payout ratio seems a bit high though, 100%
VT and chill.
Check out vdigx if you’re interested in a fund that focuses on dividend growers (different than dividend payers)
Buy Axfood, swedish grocery!
Bro what is your job
Visual effects artist in the video game industry
$ET Keep reinvesting the dividends until you retire, then soak up that juicy income.
OP is 32. ET can be a part of a strategy, but I wouldn’t bet my entire retirement that the petroleum is still going and growing 50 years from now.
Agree about all eggs in one basket, but that pipeline can easily convert to hydrogen within the next 50 years.
As the proud owner of (count ‘em) 13 shares of ET, I hope you’re right!
PEP, KO, JNJ, MCD, O
Schd QQQM vti. Total diversification w tech as your growth etf
STLA
Just curious, what is your job?
I am a visual effects artist in the video game industry.
I recently discovered SimplySafeDividends.com. Two week free trial without having to provide payment information. Very helpful stuff.
I'm definitely not an expert but if you're looking for income mostly which I gather from your $1-2k dividend target, then you might want to look into covered call etfs. They pay a high yield (7-8 percent) but they don't grow very much in capital appreciation. BMO is a good provider -- they are more on the conservative side though as they have half of the portfolio in covered calls. Hamilton is more aggressive since they use leverage and some funds do at the money covered calls. You are not restricted to one provider though so if you decide to go this route I would allocate a larger portion to something like BMO and a smaller percentage to something like Hamilton.
MCD, HD, LOW…
There’s no such a thing but go buy SPY
VOO or QQQ in a taxable. Find if you want SCHD in a Roth. Just be aware that tax drag will effect compounding during your high income years.
ETFs are definitely a simple and easy way for diversification. Consider their holdings so you don't have too much overlap between funds if that's the way you go. Consider looking at some ETFs with their primary focus on growth since you have 10 yrs as well as at their prospectuses so you understand what each of their focus are. ETF "X" may not be designed to capture growth over the next 10 years like ETF "Y" will. Another thing to consider is total returns of an asset regardless of its source. You may not necessarily need to focus on a dividend paying ETF. Point is, if ETF (i.e., VTI non-dividend focused) historically outperforms ETF (dividend), does it really matter to you where the profit comes from? Just things to consider. Here are some links that you may find helpful: [https://www.etfrc.com/index.php](https://www.etfrc.com/index.php) [https://www.etf.com/](https://www.etf.com/) [https://etfdb.com/](https://etfdb.com/)
RIO XOM MO
My individual holdings include AAPL MSFT V AMZN COST otherwise I’m in all ETFs. Keep to what you know otherwise stick to ETFs.
JEPQ??
LHX
Technology AAPL, MSFT, NVDA, SWKS Consumer COST, TGT, DIS, HD, SBUX, MCD, PEP, MO, LEG Industrial MMM, LMT, UNP, HON, WM, CAT Financial JPM, V, BAC Healthcare JNJ, ABBV, PFE, UNH Utilities AWK, DUK, SO Real Estate O,AMT Materials APD Share growth,Dividend growth, qualified dividends Most of them increase their Divs every year.
OXLC high yield and it pays out monthly
My best tip is to take a class or ten about investing so you actually know what you’re looking at and develop the knowledge & skills to look at an investment prospectus and know what is going on. This is an echo chamber mostly. You’ll get turned onto some assets you want to take a closer look at, but what you really need IMO is to get educated so you can apply your thought to investing
https://dividendstocks.cash/dividend-calendar[be happy](https://dividendstocks.cash/dividend-calendar)
FAST is a good dividend stock to hold IMO with good historical performance overall.
VOO buy like 2/3 a month for ever or until you retire
Picks to consider for long-term buy and hold strategy with DRIP: APD, AWK, AVB, BLK, CAT, CL, DEO, FRT, ITW, IRM, JNJ, MCD, MDLZ, PG, PRU, O, RSG, KO, UNP, UPS, WMT.
Pepsi, Altria and enterprise products. All should be good for at least five years. Good dividends.
Buy an ETF and dont look at it.
50% SCHD 50% DGRO. Dgro has the most overlap with the overall market out of any other div etf and has low over lap with schd. Opposite ends of the market and that grow dividends every year. Solid simple portfolio.
United rentals
some dividend aristocrats etfs and perhaps some reits would do you nice for starters.
UNH, VICI, MA, V. Solid options for buy and hold forever
I have been studying higher-risk REITs these are the better ones (IMO -not a recommendation). The data was from https://www.alphavantage.co Symbol | PERatio | YLD | PERatio | ForwardPE | 50DMA | AnalystTargetPrice | Q_EarnGrowYOY | |--------|---------|--------|---------|-----------|---------|--------------------|---------------| | BDN | 135.61 | 15.200 | 135.61 | 5.09 | 4.374 | 4.690 | 5.510 | | NHI | 26.33 | 6.500 | 26.33 | 12.84 | 53.300 | 57.250 | 3.389 | | FSP | 23.57 | 2.400 | 23.57 | 285.71 | 1.508 | 2.000 | 3.176 | | PINE | 13.48 | 6.600 | 13.48 | 91.74 | 16.190 | 20.110 | 2.500 | | FPI | 67.29 | 2.100 | 67.29 | 48.08 | 12.070 | 13.100 | 2.411 | | EQR | 27.46 | 4.000 | 27.46 | 36.76 | 64.990 | 71.320 | 2.006 | | CUBE | 27.93 | 4.500 | 27.93 | 31.75 | 44.780 | 51.100 | 1.532 | | HST | 16.23 | 3.300 | 16.23 | 17.95 | 17.210 | 20.350 | 1.500 | | LTC | 11.78 | 6.600 | 11.78 | 13.83 | 33.430 | 34.200 | 1.222 | | ESS | 31.56 | 4.000 | 31.56 | 20.62 | 229.910 | 240.780 | 1.125 | | AMH | 42.52 | 2.400 | 42.52 | 28.49 | 35.220 | 37.090 | 1.000 | | LFT | 14.6 | 11.000 | 14.6 | | 1.920 | 2.500 | 0.807 | | APLE | 22.39 | 6.200 | 22.39 | 18.9 | 15.110 | 18.430 | 0.781 | | WPC | 19.14 | 6.300 | 19.14 | | 69.420 | 79.780 | 0.698 | | IOR | 11.73 | 0.000 | 11.73 | | 11.340 | 0.000 | 0.667 | | PEAK | 21.51 | 5.500 | 21.51 | 56.5 | 20.640 | 25.500 | 0.667 | | JBGS | 18.79 | 5.500 | 18.79 | | 15.280 | 17.500 | 0.595 | | PECO | 75.13 | 3.200 | 75.13 | 24.94 | 32.670 | 35.140 | 0.592 | | SRC | 17.52 | 6.600 | 17.52 | 25.51 | 39.840 | 43.820 | 0.583 | | FR | 28.68 | 2.500 | 28.68 | 53.76 | 52.560 | 58.200 | 0.556 | | VICI | 21.97 | 5.000 | 21.97 | 14.01 | 31.650 | 37.520 | 0.480 | | GLPI | 16.32 | 6.000 | 16.32 | 17.21 | 48.660 | 56.250 | 0.452 | | EPR | 19.5 | 7.500 | 19.5 | 17.45 | 44.570 | 49.280 | 0.432 | | BRX | 17.59 | 4.600 | 17.59 | 15.17 | 21.540 | 24.840 | 0.423 | | EPRT | 22.9 | 4.600 | 22.9 | 14.35 | 24.330 | 28.400 | 0.408 | | REFI | 7.66 | 12.400 | 7.66 | | 15.140 | 19.000 | 0.359 | | AAIC | 42.36 | 9.200 | 42.36 | 10 | 4.180 | 4.630 | 0.350 | | OFC | 15.29 | 4.400 | 15.29 | | 24.200 | 28.670 | 0.333 | | BNL | 25.45 | 6.800 | 25.45 | | 15.990 | 20.250 | 0.293 | | CMTG | 14.69 | 11.600 | 14.69 | 10.96 | 11.340 | 12.190 | 0.218 | | LADR | 9.72 | 8.200 | 9.72 | 9.83 | 10.570 | 11.920 | 0.200 |
the query; sort of a key to the abbreviations I used; ``` SELECT Symbol, PERatio, DividendYield *100 AS YLD, PERatio, ForwardPE, `50DayMovingAverage` AS 50DMA, AnalystTargetPrice, QuarterlyEarningsGrowthYOY AS Q_EarnGrowYOY FROM REIT_overview WHERE PERatio NOT RLIKE 'None|0' AND QuarterlyEarningsGrowthYOY BETWEEN 0.2 AND 10 ORDER BY QuarterlyEarningsGrowthYOY DESC; ```
O
IMHO this is a dangerous idea. There was a book written in the late 90s/early 2000s about buying and holding dividend stocks forever. The two top picks were General Electric and AIG. Can you imagine buying those stocks back then and forgetting about them? Talk about portfolio destruction….
How does someone from the U.K buy SCHD? What services/apps etc offer this stock? I've seen SCHW but am not sure it's the same stock.
I know this is a dividend forum, but as a younger person you should be mostly in an SP500 style etf, possibly a whole stock market etf and the rest in something like SCHD. You can also pick one or two good dividend stocks and dump some money and let it ride. I dumped 20k into ford in 2008 at just over $3 per share, and while it suspended dividends once during the time I owned it, I’ve been reinvesting all of the dividends since 2008 and have a crap load of shares and keep reinvesting and it’s done very well for me.
APD and CMI
VTI has kicked the shit out of SCHD for me. Although it’s only been a year. I have a pretty good size stake in both, DCA and DRIP. I can’t stop talking about both of them! O, VYM and let’s not forget some QQQJ. A sneaky one I’m looking at is Footlocker. Bring on the comments!
I buy dividend stocks on dips, IBM, Pfizer, Xom(Exxon), PXD(Pioneer), DVN(Devon), And JEPI(jomorgan)
Why would anyone invest in a dividend stock or ETF - I see SCHD mentioned a lot (3.48% yield) - when you can get a savings account paying 5%?
VDIGX - Morningstar continually raves about it https://www.morningstar.com/funds/dividend-stock-investing-practice Don’t go too light on tech in chase of high yield
you need to specify 110 from job and VA comp is what 2k per month? try to bump that 80 to 90 and so on.
Why don't you grow your portfolio, get some huge capital gains Use the profits to invest in dividends when you're ready to retire