Nice analysis. Just try telling retired Dividend Growth Investors like myself that dividends are irrelevant when they are the basis for monthly income greater than 4% a year and they grow at a rate greater than inflation. In addition although my goal is capital preservation I am still rewarded with capital gain. Dividends sure are relevant to this retiree...
What does it take? I am not "shouting out with a ONE YEAR result" The period 2002-2011 is not one year... Plus I haven't even posted this year results....Once again my portfolio beat the index for each of the 10 years. It was strongest against the index during the down years of 2002 and 2008. It was -6.8% vs. -23.4% for the index in 2002. In 2008 this portfolio was -16.63% vs. -38.5% for the S&P. During this 10-year period, the S&P 500 averaged 3.86% including dividends, while the average for this portfolio was 12.98%. This portfolio yields approximately 4.5% vs. the current yield for the S&P 500 of just under 2%.
It's truly amazing how you write critical comments without even considering a point of view other than you own.
I'm not sure most retirees want to own rental properties. I'm not trying to match anyone. Never said stocks are the sole way to manage one's wealth. I'm just trying to maintain a safe and growing stream of income though my retirement years. Not saying its for everyone just that its working for me... I'm sure with your market skills your three stock portfolios are killing the market. How about posting what stocks you own and their gains their gains for each of the last ten years?
One Man's Search For A Safe And Growing Income Stream - Part 5 [View article]
remurraymd...
I appreciate the comment. Don't worry I'm not "chasing yield too much", I 'm living on it.My goal is simple. Live on the dividends,and don't touch the principle . Give myself a raise...i.e increase monthly payout from dividends at least equal to inflation due to dividend growth. As a bonus, each of the stocks presented for consideration outperformed the market during the last tough decade for stocks.
Why Dividend Champions Of The Past Will Offer Minimal Long-Term Income And Total Returns [View article]
II...
I too question the title you have chosen. First Dividend Champions include more than Consumer staples. Second while MO and KMB may be currently overvalued it is important to remember their long histories of safe and growing dividends.
By comparison I challenge you and others to do a year by year review of GE, the stock it appears you are recommending for boomers, for the period 2002-2011. Notice how many years it lost money during that period. Notice that it cut its dividend. Notice how much it lost in 2008.
Having done that turn next to MO, KMB or any of the other stocks listed above that you are suggesting we might abandon. Do the same year by year review. In contrast none cut their dividend and each enjoyed capital gain on average 8 out of 10 years. I believe that history shows that stocks that maintain dividends and consistently grow them are stocks that consistently show up in the green rather than the red.
I own rental properties too but I don't have to manage mine. I just collect my dividends from OHI,WPC,NNN,HCN. Leaves more time for travel and grand kids.
Dividend Growth Investors - Prepare For The Correction [View article]
Ron...
Cranky is solid in his support that equities shouldn't make up more than 60% of any portfolio and that investors will need to sell during the distribution. He is convinced that failure to subscribe to MPT will cause any investor to panic and sell everything when the market collapses.
Nothing anyone says is going to change his mind. That's ok because there is nothing that anyone could say to make me want gold.
Dividend Growth Model Portfolio Update: Dividend Aristocrat+ Gainers And Decliners [View article]
Jeff...
Thanks as always for the updates on your portfolios. Similar results for my portfolio which lags the index by 1.5% with a Beta of .7 and an overall yield of 5%. Since I'm already retired this is the type of performance that lets me Sleep Well At Night.
Investment Strategy: What Portfolio Withdrawal Rate Can You Live With? [View article]
Draw down of principal...Not gonna do it. Would not be prudent...ha,ha.
Believe it or not I was shown actually the same presentation by the folks who had our 401K just before we retired. The million dollar figure and all. Scared the crap out of my wife but I guess that's what its designed to do. Since heeding the wisdom of the two Daves - above, we have stopped making withdraws from capital. We earn safe growing dividend income of 5% the value of our portfolio. During the last two years our capital gains have exceeded the market.
The Real 'Better Advice For Seniors' [View article]
Michael...
I need clarification on your statement " senors need some growth in their portfolio to offset inflationary pressures as dividends on average have very low rates".
As to the first part of this statements...I would answer by saying seniors need growth but not growth stocks as your suggesting but safe and reliable growth in the dividend that the stock throws off. Most thoughtful Dividend Growth Investors look for stocks with 5 year Dividend Growth rates that exceed the rate of inflation.
As to the second part of your statement...There are well in excess of 100 stocks with yields that when combined can produce a diverse portfolio with a yield between 4.5 and 5 percent and combined dividend growth greater than inflation.
Many of us hold 50 equally weighted positions to lessen the effect to monthly income that could come from an unforeseen dividend cut.
The true Dividend Growth Investor does not follow the formal 4% withdraw rule advocated by the industy, one that requires the investor to sell stocks often in down markets to produce income. Selling stocks is not required in part because the Dividend Growth Investors have portfolios that yield more than twice that of the S&P 500 Index.
As upbeat as ever. Try to find a Dividend Growth ETF that beat the market each of the past ten years and yields 4.5%. With the severe bear markets of 2002 and 2008 if a stock didn't cut its dividend I'm more confident putting my retirement there than in any other investment option. I'm further reducing risk to income with 50 equal weight positions. If one or more stocks cuts a dividend it will have a smaller effect.
I can absorb a hit to capital gains as long as the dividend income continues. With the stocks in this portfolio, history strongly suggests that it will. Sure beats withdrawing 4% of capital gains a year and hoping I die before the money runs out.
The majority of folks here have traditionally had their money invested in 401K's supported by managed mutual funds and index funds. Some 401ks are more restrictive than others but all are based on MPT designed to build wealth to then be withdrawn during retirement.
I think there are common threads among the Dividend Growth investors who regularly comment here particular those who I call Dividend Growth Income investors. DGI investors are retired and have made a decision to forgo the 4% draw down of capital every year of retirement in hopes that it outlasts a 30 year retirement. I'm sure you'll agree when I say that this is one of the chief expectations, if you will, connected with following MPT.
Most Dividend Growth Income investors have chosen instead to build portfolios that yield between 4-5% with dividend growth that exceeds inflation. This yield will then provide provide the basis for retirement income in lieu of withdraw of capital gain totaling 4%. Since index funds often don't yield that amount they are not commonly used in portfolios of that design.
Personally I don't find the folks who comment here anymore self-congratulatory than those who promote the use of options or advocates for preferreds or bonds.
As long as your ultimate goal is to follow the 4% withdraw rule in retirement recommended by your advisor and your understanding is that your money is only suppose to support you during a 30 year retirement then continuing the path set by MPT and your 401K will work for you.
Because many of us have set different goals we are following a different path now that we are retired.
Take care and enjoy the path you have chosen no matter what that path may be.
Great article! There will always be new myths advanced about Dividend Growth investing and I know you'll be there to strike them down when they come. The simple fact is Dividend Growth investing is a great way to maintain and grow income. As you and I and so many who are retired and actually doing this know...It works. It takes some effort to do it right...but it works. Each year I get income without touching principle it works even better.
The Real False God Of Dividends [View article]
Nice analysis. Just try telling retired Dividend Growth Investors like myself that dividends are irrelevant when they are the basis for monthly income greater than 4% a year and they grow at a rate greater than inflation. In addition although my goal is capital preservation I am still rewarded with capital gain. Dividends sure are relevant to this retiree...
All the best
Bob
Our Dividend Growth Portfolio Produces Our New Retirement Paycheck [View article]
What does it take? I am not "shouting out with a ONE YEAR result" The period 2002-2011 is not one year... Plus I haven't even posted this year results....Once again my portfolio beat the index for each of the 10 years. It was strongest against the index during the down years of 2002 and 2008. It was -6.8% vs. -23.4% for the index in 2002. In 2008 this portfolio was -16.63% vs. -38.5% for the S&P. During this 10-year period, the S&P 500 averaged 3.86% including dividends, while the average for this portfolio was 12.98%. This portfolio yields approximately 4.5% vs. the current yield for the S&P 500 of just under 2%.
It's truly amazing how you write critical comments without even considering a point of view other than you own.
I'm not sure most retirees want to own rental properties. I'm not trying to match anyone. Never said stocks are the sole way to manage one's wealth. I'm just trying to maintain a safe and growing stream of income though my retirement years. Not saying its for everyone just that its working for me... I'm sure with your market skills your three stock portfolios are killing the market. How about posting what stocks you own and their gains their gains for each of the last ten years?
Take Care
Bob
One Man's Search For A Safe And Growing Income Stream - Part 5 [View article]
I appreciate the comment. Don't worry I'm not "chasing yield too much", I 'm living on it.My goal is simple. Live on the dividends,and don't touch the principle . Give myself a raise...i.e increase monthly payout from dividends at least equal to inflation due to dividend growth. As a bonus, each of the stocks presented for consideration outperformed the market during the last tough decade for stocks.
Works for me and I trust others.
Take care
Bob
Why Dividend Champions Of The Past Will Offer Minimal Long-Term Income And Total Returns [View article]
I too question the title you have chosen. First Dividend Champions include more than Consumer staples. Second while MO and KMB may
be currently overvalued it is important to remember their long histories of safe and growing dividends.
By comparison I challenge you and others to do a year by year review of GE, the stock it appears you are recommending for boomers, for the period 2002-2011. Notice how many years it lost money during that period. Notice that it cut its dividend. Notice how much it lost in 2008.
Having done that turn next to MO, KMB or any of the other stocks listed above that you are suggesting we might abandon. Do the same year by year review. In contrast none cut their dividend and each enjoyed capital gain on average 8 out of 10 years.
I believe that history shows that stocks that maintain dividends and consistently grow them are stocks that consistently show up in the green rather than the red.
Finally XOM is a Dividend Champion.
Take care
Bob
Our Dividend Growth Portfolio Produces Our New Retirement Paycheck [View article]
I own rental properties too but I don't have to manage mine. I just collect my dividends from OHI,WPC,NNN,HCN. Leaves more time for travel and grand kids.
Life is Good!
Bob
Dividend Growth Investors - Prepare For The Correction [View article]
Cranky is solid in his support that equities shouldn't make up more than 60% of any portfolio and that investors will need to sell during the distribution. He is convinced that failure to subscribe to MPT will cause
any investor to panic and sell everything when the market collapses.
Nothing anyone says is going to change his mind. That's ok because there is nothing that anyone could say to make me want gold.
Bob
Retirement Plumbing: The Cistern System [View article]
Very nice my friend. Sometimes a picture is worth a thousand words.
Bob
Dividend Growth Model Portfolio Update: Dividend Aristocrat+ Gainers And Decliners [View article]
Thanks as always for the updates on your portfolios. Similar results for my portfolio which lags the index by 1.5% with a Beta of .7 and an overall yield of 5%. Since I'm already retired this is the type of performance that lets me Sleep Well At Night.
Take care and Happy New Year.
Bob
Investment Strategy: What Portfolio Withdrawal Rate Can You Live With? [View article]
Believe it or not I was shown actually the same presentation by the folks who had our 401K just before we retired. The million dollar figure and all. Scared the crap out of my wife but I guess that's what its designed to do. Since heeding the wisdom of the two Daves - above, we have stopped making withdraws from capital. We earn safe growing dividend income of 5% the value of our portfolio. During the last two years our capital gains have exceeded the market.
Bob
Investing In Dividend Stocks: Why I Chose The Stocks In My Portfolio - Part 3 [View article]
Someone is having a very bad day.
The Real 'Better Advice For Seniors' [View article]
I need clarification on your statement " senors need some growth in their portfolio to offset inflationary pressures as dividends on average have very low rates".
As to the first part of this statements...I would answer by saying seniors need growth but not growth stocks as your suggesting but safe and reliable growth in the dividend that the stock throws off. Most thoughtful Dividend Growth Investors look for stocks with 5 year Dividend Growth rates that exceed the rate of inflation.
As to the second part of your statement...There are well in excess of 100 stocks with yields that when combined can produce a diverse portfolio with a yield between 4.5 and 5 percent and combined dividend growth greater than inflation.
Many of us hold 50 equally weighted positions to lessen the effect to monthly income that could come from an unforeseen dividend cut.
The true Dividend Growth Investor does not follow the formal 4% withdraw rule advocated by the industy, one that requires the investor to sell stocks often in down markets to produce income. Selling stocks is not required in part because the Dividend Growth Investors have portfolios that yield more than twice that of the S&P 500 Index.
The author is spot on with what she is saying.
Thanks
Bob
Our Dividend Growth Portfolio Produces Our New Retirement Paycheck [View article]
As upbeat as ever. Try to find a Dividend Growth ETF that beat the market each of the past ten years and yields 4.5%. With the severe bear markets of 2002 and 2008 if a stock didn't cut its dividend I'm more confident putting my retirement there than in any other investment option. I'm further reducing risk to income with 50 equal weight positions. If one or more stocks cuts a dividend it will have a smaller effect.
I can absorb a hit to capital gains as long as the dividend income continues. With the stocks in this portfolio, history strongly suggests that it will. Sure beats withdrawing 4% of capital gains a year and hoping I die before the money runs out.
Take care
Bob
Dividend Growth Portfolio: 2012 Mid-Year Update [View article]
Always nice to see that thoughtful investors never stop evolving.
Thanks for continuing to be such an important part of my evolution.
Bob
Dividend Growth Investing: Myths 11-15 [View article]
The majority of folks here have traditionally had their money invested in 401K's supported by managed mutual funds and index funds. Some 401ks are more restrictive than others but all are based on MPT designed to build wealth to then be withdrawn during retirement.
I think there are common threads among the Dividend Growth investors who regularly comment here particular those who I call Dividend Growth Income investors. DGI investors are retired and have made a decision to forgo the 4% draw down of capital every year of retirement in hopes that it outlasts a 30 year retirement. I'm sure you'll agree when I say that this is one of the chief expectations, if you will, connected with following MPT.
Most Dividend Growth Income investors have chosen instead to build portfolios that yield between 4-5% with dividend growth that exceeds inflation. This yield will then provide provide the basis for retirement income in lieu of withdraw of capital gain totaling 4%. Since index funds often don't yield that amount they are not commonly used in portfolios of that design.
Personally I don't find the folks who comment here anymore self-congratulatory than those who promote the use of options or advocates for preferreds or bonds.
As long as your ultimate goal is to follow the 4% withdraw rule in retirement recommended by your advisor and your understanding is that your money is only suppose to support you during a 30 year retirement then continuing the path set by MPT and your 401K will work for you.
Because many of us have set different goals we are following a different path now that we are retired.
Take care and enjoy the path you have chosen no matter what that path may be.
Bob
Dividend Growth Investing: Myths 11-15 [View article]
Great article! There will always be new myths advanced about Dividend Growth investing and I know you'll be there to strike them down when they come. The simple fact is Dividend Growth investing is a great way to maintain and grow income. As you and I and so many who are retired and actually doing this know...It works. It takes some effort to do it right...but it works. Each year I get income without touching principle it works even better.
My thanks as always
Bob