I shared some of my story in a comment a few weeks ago. I thought it would be good to expound a little bit to encourage those of you that are just getting started. First of all, I encourage all of you to enjoy the learning process. The thing I love most about dividend growth investing, besides the monthly income, is the education. This sub reddit has furthered my education in the last couple months, which is so great!

Before I continue I do want to point out that at some point in time I threw probably most of my savings at Dividend Growth investing and I also had weird circumstances the last couple years that allowed me to invest more than I normally would be able to. I do feel like I’m a little late to this game, but better late than never. Some people may be discouraged and think that they may not make enough income for this sort of investing. However, habits and mindset are important and you want to have these in place if you have opportunities to make more income in the future. If you are ever going to get ahead, you need to start somewhere. And you need to start sooner, not later. Also it’s been my experience that investing and wanting to see your yearly income grow can drive you to try to make more income. Lastly, compounding income does amazing things.

Prior to learning about dividend investing, I hadn’t invested much and my strategy was terrible. Typically I would purchase a stock like Apple at a somewhat high price, hold for a few months while I grew inpatient only to sell at a much lower price. Because of this, I convinced myself that the only people that made money in the stock market were day traders.

Summer of 2019, one day on YouTube I ran across a video by Andre Jikh. I hadn’t previously watched any of his videos but for some reason the title of this one video stuck out to me and I watched it. He talked about how he was investing in stocks that paid dividends in his Robinhood account. After watching the video, the lightbulb in my brain turned on. I loved the idea of monthly income. It made sense to me. I loved the idea that I could retire and live off of the dividends instead of selling off the principle of my retirement to pay for my living. And I loved the idea that I could see income from it right away. I could see this thing grow and compound through income that I was generating every month. Amazing. I started buying dividend stocks in my Robinhood account.

In one of Andre Jikh’s videos he talked about Simply Safe Dividends, which is the platform I use to track my stocks. They provide reports on any changes with the holdings that I have along with a pretty helpful rating system. Even though it was expensive at the time, $400, I felt like just as soon as I could, this subscription would not only help keep me out of trouble, but would provide me with a lot of education and also encourage me to keep investing. It’s cool seeing the yearly income number grow every week.

Eventually I ran across another YouTube Channel called the Joseph Carlson Show. I love how Joseph thinks. I quickly saw the advantages of using the M1 Finance platform that he talked about with their pie system. So I sold my stocks in Robinhood and repurchased them in M1 (It somehow worked out and I didn’t know how to move them at the time).

I continued to learn as much as I could. I bought a lot of stocks based on the resources I had listening to Joseph Carlson, Dividend Data and seeing what Simply Safe had to say about things. I stopped listening to Andre Jikh very much because he seemed to veer off more into growth stocks and then today it seems like all he talks about is Crypto, not dividend stocks at all. Things change, people change and certainly this has been a weird year. πŸ™‚

In 2020, March through May was obviously a hard set of months. My income went way down but every penny I could get a hold of I used to buy the dip. Summer of 2020 when my income started going back up, I used some of that money to buy growth stocks. It was a distraction from my overall strategy of dividend stocks, but it certainly helped me grow my money quickly. This last year has been unlike any other so I don’t really recommend buying growth / tech stocks the same way I did last year. I’ve since sold those things to put back into my dividend portfolio. December of 2020 I bought some Bitcoin and then I sold it several months later to add to my dividend portfolio as well. Not sure that’s something I would recommend either.

One thing I did in 2020 that I’m really glad for now, is I invested a good bit into the energy sector. Those stocks have grown pretty considerably since I was able to purchase them at good prices last year.

Today I’m sitting at $350,000 in stock value in my M1 account. 69 holdings. $13,470 per year in income. Beta of 0.83. Dividend Yield of 3.84%. Today I continue to learn by reading this sub. This sub has made me aware of more educational resources on YouTube and has also opened my mind to the idea of different kinds of dividend paying ETF’s that I may explore soon. It’s rad having a community where you can see each other’s stories and be encouraged by them to keep going.

In closing, here are some things that I’ve learned and some things that I want to encourage you guys with:

  • Enjoy the learning
  • Create a playlist and listen to good dividend investors on YouTube whenever you get a chance
  • Invest regularly
  • Set small goals for yourself to increase your yearly dividend income

Hope this is encouraging. I have no idea. Sorry that it’s kind of also long winded. πŸ™‚πŸ‘

Thanks mates. Happy dividend growth investing.

EDIT: I’ve had some requests to see my M1 Pie. It says that it won’t let me share my whole pie and I can only share slices πŸ˜•. Here you go:

Energy (17.5% Actual / 12% Target): https://m1.finance/l4uX6ziSo0Rg

Real Estate (15.9% Actual / 12% Target): https://m1.finance/uOxFsYC_egfg

Consumer Staples (14.1% Actual / 15% Target): https://m1.finance/8E4kCu6kCZxT

Healthcare (9.8% Actual / 9% Target): https://m1.finance/lWU4ElnCx8vB

Industrials (8.5% Actual / 9% Target): https://m1.finance/BM5ipBH9eXPd

Utilities (8.3% Actual / 10% Target): https://m1.finance/iU7p4i1Vm4or

Financia (7.8% Actual / 9% Target)l: https://m1.finance/zm6mvNzkNdFp

Technology (7.2% Actual / 9% Target): https://m1.finance/Am8z0tkb0ANa

Consumer Discretionary (5.7% Actual / 9% Target): https://m1.finance/uCUKBxrPyII8

Communications (3.9% Actual / 5% Target): https://m1.finance/G8j_Bw3vk_ag

Materials (0.7% Actual / 1% Target): https://m1.finance/mb-Fh14ldLmt

EDIT 2: Because so many stocks seem very inflated these last many months, I put a high threshold on Auto-Invest so that as dividend income comes in, I can make my own purchases on stocks that may be a better deal right now. I’ve been putting a lot more focus on my Consumer Staples pie (HRL, KMB, KR, MO, WBA, TSN…). Buying up stocks of boring companies where people rely on their products.

EDIT 3: What makes M1 Finance kind of unique is their pie and reinvestment system. You setup your sector pie and stocks within each slice, and then as you get dividends, those dividends are automatically reinvested into the pie wherever your are underweighted. Traditional brokerages seem like they do more of a drip system, if you set it up, which will have your dividends purchase more of the stocks that the dividends came from. I suppose there are pros and cons. You can always turn off auto-invest in M1 Finance and just invest the dividends into whatever stocks you like.

Another reason that I like M1 Finance is the ability with their Plus account to get 1% interest on any monies I have holding in my Spend account. And then if I needed to borrow money against my portfolio, I could do that at 2% interest.

I think that M1 Finance is geared toward the long term dividend growth investor but I wouldn’t call it a must have. For stocks that I’ve purchased purely for growth and not dividends, I use either TD Ameritrade or Fidelity. With M1 you only get 2 trade windows per day (with Plus), which means you can’t really buy or sell quickly if there’s an opportunity. But I like it. And the M1 app is really great.

EDIT 4: Thank you everyone for all the upvotes and rewards! Too kind.

EDIT 5: The Title may be misleading to say “$350k invested”. In the last 1.5 years at my current brokerage, I’ve experienced about $78k in gains. Around $65k in market gain and about $13k in dividends earned. So more accurately I have somewhere around $272k invested. It’s obviously a lot of market gain and that’s just because of the craziness that we’ve experienced in the last year. The reality of my first 6 months doing dividend investing was that I didn’t really see a ton of gains. But when I started seeing dividends coming in, that’s what got me excited. The value of stocks go up and down. But those dividends are something special.

submitted by /u/Substantial-Trade912
[link] [comments]


Go to Source of this post
Author Of this post: /u/Substantial-Trade912
Title Of post: Learning is Cool ($350k invested / $13,470yr Income)
Author Link: {authorlink}

By admin