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peace4

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  • The Dividend Growth Investing Mindset [View article]
    Chowder,
    I have a piggy back question re tax advantaged accounts. I don't have any, I am not working, and I am 71 and not likely to work. So am I shut out? I was thinking the best thing for me to do is to get my basic income needed from my portfolio diversified and then after that, just let my winners run and stick to mostly dividend income which is at 15%. I would only sell shares then to help grand kids go to college.
    Peace
    Mar 8, 2015. 06:47 PM | 2 Likes Like |Link to Comment
  • Is It Time For Investors To Forgive Banks? S&P 500 2015: Part 4A [View article]
    @ pbanik
    But I still doubt that I am eligible for any of these tax avoidance programs like IRA and 401 because I am not currently employed. I believe they are all tied to employment.
    In two or three years I will be done with rebalancing my portfolio to secure basic needs and then I can just let my winners run so there will be no cap gain other than for grand kids education. All ordinary dividends are taxed at the same low 15% rate so that will not be much to worry about.
    Peace
    Mar 6, 2015. 08:07 AM | 1 Like Like |Link to Comment
  • Dividend-Stingy Wal-Mart Was Already On Probation, So What Now? [View article]
    Mike,
    You did good. And while you were doing yourself some good, this article and this comment stream has done all the rest of us here at Seeking Alpha a whole lot of good too. Thanks to you and everyone else who posted comments.
    Peace
    Mar 5, 2015. 02:13 PM | 2 Likes Like |Link to Comment
  • Retired Investors: Beware The Materials Sector Of The S&P 500 - Part 9 [View article]
    While I am not color blind, I know red and green color blindness is a major problem for many and more of them are men.
    I certainly appreciate all your FAST graphs and the many improvements. Your articles are treasured.
    Peace
    Mar 5, 2015. 08:52 AM | 2 Likes Like |Link to Comment
  • Is It Time For Investors To Forgive Banks? S&P 500 2015: Part 4A [View article]
    @pbanik
    I am 100% in stocks for my investing but there is a tiny Social Security check that contributes to a checking account I keep on hand and it is only for emergencies. Along with some extra money I have in there, I could glide a full year on that emergency account if I needed to. I am good at pinching a budget when needed. Everything else is dividend growth stock invested in taxable accounts because I do not know anything at all about those advantaged accounts. I have no broker. Don't know anything about them either.
    My understanding is that the tax advantaged accounts require that you be employed and I am not employed now and do not expect to hold a job at my age.
    At no time did I ever expect to have enough income to trigger any appreciable amount of tax, but then I unexpectedly inherited a house that was bigger than my needs, sold it, bought a small house, and invested the difference in some new low growth and also some new high growth dividend positions. These fast growers are the positions that are now bringing me into taxable range. I never expected to have so much income. All I can say is, "What a pleasant problem to have!"
    So long as I am only taking the dividends there is no tax problem big enough to worry me, but if I sell shares, then there is a higher tax on the cap gains.
    There are several ways to control the cap gains problem. I could have a money market account maybe and put extra dividend money in there until a grand child needs it. I could even sell some extra shares when I do trim a holding and use those extra shares to pay the tax. I could just let the charities wait until I die and they can have a big donation in my will and I will be past caring about any tax by that time.
    I think Chowder calls this tax problem the success tax and I agree that it is just part of reaching my goals as an investor. If I do not pay my part of the cost of running this country, then a lower income person may have to do that for me and it is certainly not my style to live that way. I do love America and I always pay my share. It would be dishonorable not to.
    My only problem with tax bills is that I wish the government did not send so many youngsters into so many expensive wars that seem un necessary. But now we are getting into politics so let's not go there.
    My investing seems to be excellent and thanks to Seeking Alpha I am well past reaching my goal and merely reinforcing it now. I am a fortunate old lady. Thank you all so very much.
    Peace
    Mar 5, 2015. 08:19 AM | 3 Likes Like |Link to Comment
  • The Dividend Growth Investing Mindset [View article]
    Good for you, Mike!
    This is your portfolio and you get to make all the decisions and no apology is needed. Be comfortable with it. Stress is no fun.
    Peace
    Mar 4, 2015. 05:52 AM | 3 Likes Like |Link to Comment
  • Is It Time For Investors To Forgive Banks? S&P 500 2015: Part 4A [View article]
    @pbanik,
    I started investing in 1978 with a utility on the advice of my mentor. I have never sold any of those shares but the utility did split off a portion which went private several years back. I assumed at the beginning that I would be a pure buy and hold investor just as my mentor was.
    But all my positions are different. My mentor held his WFC shares without ever selling any of them since he inherited them from his father back in 1052. That is what his father had done and so that is what he continued doing. In his elder years, my mentor spent the dividends.
    When I bought my first WFC shares, I did not reinvest because I was not working and needed the dividend income, but they grew quite rapidly. Then I sold rather small amounts quite frequently to pay the timber costs for the boat we were building. Still it grew faster than I was selling it even though I was not reinvesting.
    Then the TARP restrictions stopped the dividends and we were sailing around living on the boat and the budget was extremely tight but we did not sell until the price of the shares returned to pre TARP levels because I did not want to do anything differently than my mentor had done. I was following in his footsteps because I knew no other way.
    But then the size of that one holding dwarfed all my other holdings and I worried and I was by then reading here on Seeking Alpha and learned that some folks sell shares as a natural method of diversifying their portfolios and that seemed like a good thing to make a portfolio more broad based and less risky. So I started selling a bit each year and using the money to diversify my portfolio. WFC grew faster and I read that some respected folks like Chowder do not hold banks at all because they believe them to be too risky. So then I sold a large chunk of my WFC holding and diversified more and still the WFC grew right back. I have done that now three times and I guess it will just need that kind of deep pruning like some plants require each year out in the garden.
    Fortunately I have several holdings that are the buy and hold variety which are steady payers and grow slowly because they have high yields. And equally fortunately I have a few of these fast growing low div paying holdings that need to be pruned each year to keep them from growing wild and causing me worry. Some get held and some get pruned and the money is held within the portfolio but it is in different positions. It is a different method of portfolio operation but it is not selling to spend for living expenses. In my case, all my living expenses are currently covered by the existing portfolio already. I live a very modest lifestyle and like it that way.
    In two or three years or so, all of my holdings will be brought up to equal size through pruning and reinvesting and then I will likely prune less often and then only to assist grand children with education bills.
    Since reading here on Seeking Alpha, I have learned that there are many ways to operate a portfolio and most folks do change their operations over their lifetimes as investors. Usually they start out with many different small investments which reinvest and that gives them a broad base of growing core type investments. Then they may have a few more speculative types of investments also reinvesting. Then they retire and reinvesting gradually reduces in order for the dividend stream to provide the intended income in their elder years. Some folks have different tax advantaged accounts and move investments around. I never had those and do not understand them either.
    But I consider myself to be a successful investor because my goals have been met and my income is greater than my needs and it is growing faster and faster each year. Now that I have a more diversified portfolio, I feel better protected from any future shock such as what happened during the TARP years. Back then I had very few positions and those were hard years. Likely I will never have that stress in our household budget again. In the future, I will likely add some new positions to my portfolio through annual pruning WFC and using that money to buy new positions. Seeking Alpha has taught me this method that works better for me. I buy and hold the money within the portfolio but in different shares. I did not buy and sell and spend outside of the portfolio. And now that the goal has been met, and I have more income than I need, I will be free to sell and spend some of that for fun while returning most to the portfolio. The grand kids will have good educations if they want them.
    We are not talking about a lot of money here. I pay tiny taxes even though all of my portfolio is in taxable accounts. I live simply by preference.
    Peace
    Mar 4, 2015. 05:48 AM | 2 Likes Like |Link to Comment
  • Stay The Course: See Income Compounding Results In The Early Years Of A Dividend Growth Strategy [View article]
    Canadian,
    Step number one would be for you to sit down with yourself and make a decision about what you want your portfolio to do for you. You can never get "there" if you do not know where you are going.
    There are a few very good and detailed portfolio business plans that have been written down for all of us to see and think about. Some of us have studied them carefully and used some of the ideas that we liked. Bob Wells wrote his plan down and had a series of changes he wrote about. You can also see the details of the plan that Chowder uses for the portfolio he uses for his son - just google Project 3 Million.
    You need a plan. Then you need to write it down. Then think it over and be sure it is right for you. Then just follow it because you will then know it is a good plan that is just right for you and you won't be getting yourself all confused.
    Life is better if you know what you want out of it.
    Peace
    Mar 3, 2015. 03:53 PM | 1 Like Like |Link to Comment
  • Stay The Course: See Income Compounding Results In The Early Years Of A Dividend Growth Strategy [View article]
    ccllrr,
    The key for me was to have had my mentor for the first years of investing starting back in 1978. During the big corrections back in those years, he never panicked and always just rubbed his hands together grinning eagerly as he decided which of his investments to add to while it was on sale cheap. He had only two investments back when Ifirst met him and I suggested a couple more over the years before he died. They just made sense to me and they did well, but I really did not understand fundamentals etc back then.
    Then I found Seeking Alpha and reading here has taught me how to properly select stocks, given me many ideas about how some folks run their portfolios, and opened my mind to what to think about generally when investing and especially what not to think about during panic times.
    Here it all is, free of charge, with all kinds of links which I usually fail to find but the rest of you comment on them enough so I get the general ideas. I am not a computer person and truly not mathematical either. But you can figure it all out right here if you keep at it long enough. Some of the commenters are so fun they make me laugh out loud.
    Graph paper helps me tremendously. Others laugh and that's fine. What is life worth if you don't get a laugh daily? My dividend income goes up and up and now I sell some shares when they get too big for my comfort level and that income is even greater than the dividend income But I know it is less reliable than dividend income, so I move it into dividend payers that are at fair value and not yet at their full level in my portfolio of ten.
    I am so happy and grateful to Seeking Alpha. I am a person who loves to live simply so my road to financial independence has been a shorter one than someone who has a richer lifestyle and higher expenses to maintain it. We each make our own decisions about such things, but I really like already "being there" and knowing I can stay here or move higher whenever I wish to.
    Never thought I would be so happy at this age. I am a satisfied old lady with a satisfied old man as my husband and we are both amazed at the power of dividend growth investing and all the various methods of managing a DGI portfolio.
    All the best to you,
    Peace
    Mar 3, 2015. 12:43 PM | 3 Likes Like |Link to Comment
  • Is Dividend Growth Slowing Down? [View instapost]
    Great article and interesting thread.
    I, too, am long PG and it is a full position for me. I must admit that I will be satisfied for now if the dividend keeps coming in and I will be even more satisfied if it just grows faster than inflation. To be honest, I will likely never sell PG unless they cut that dividend harshly.
    I have enough dividends in my portfolio now to pay the bills and these days the fantastic growth of some of my holdings like WFC and LOW, have me selling a few shares when their positions are beyond full, so I can use that money to buy slower growing but reliable incomes from the likes of T and CVX etc.
    I am pretty contented as I am but I am watching PG closer than before and I thank you for this article.
    Peace
    Mar 3, 2015. 12:00 PM | 1 Like Like |Link to Comment
  • Is It Time For Investors To Forgive Banks? S&P 500 2015: Part 4A [View article]
    A person could drown in the "juice" that comes from the WFC lemonade stand. I have held WFC since 1997 and these days I am trying to keep it from growing too fast and making my portfolio overwhelmingly lop sided. So what I sell each year from my WFC holding is nearly double what I bought if for back in the beginning. Lots of juice. But maybe unreliable, so I reinvest that money into other reliable holdings. Very easy and very safe and my goal of reliable, and predictable, and growing dividends is doing nicely, thank you.
    Peace
    Mar 3, 2015. 10:09 AM | 1 Like Like |Link to Comment
  • Stay The Course: See Income Compounding Results In The Early Years Of A Dividend Growth Strategy [View article]
    A couple of months ago, I made a change in my investing program. In my portfolio were some fast growth low yield positions and some slow growth high yield positions. I am 71.

    One of my fast growing and low yielding positions is WFC, and after reading a lot of Chowder's writings, it worried me early in 2013 because it had grown so large and I feared it might not be reliable enough as a dividend payer for a person my age. So I sold a third and brought it down closer to a size that I decided would be my maximum for any position in my portfolio. I even considered selling it all off over the next two or three years, but now I have a different plan as you will see. I invested almost all of that WFC money that I got from selling some of its stock back into slower growing but reliably yielding positions in my portfolio including some T. We called the practice of selling fast growing and low yielding stocks, "decapitation" and we were thinking of the many headed mythical creature - the hydra. The more you cut the heads off a hydra, the more heads they grow. WFC has been just like that for me and in 2014 I sold another large chunk of WFC and again this year started with me selling even more and it in January and it is still likely to need to be decapitated again before the year is out. Always most of the money has been reinvested in other slow growth high yield positions. So WFC has rapidly grown the T holding and some GIS and CVX and other reliable positions quite nicely for me. LOW is also getting close to being decapitated in a little while and I think it might become another hydra for me. Its decapitation money will go to GIS too and maybe I will have enough faith in MCD to bring that holding up some more by then. I will keep watching for that. Eventually my UNP and CBRL positions will grow enough for me to decapitate them too. They pay very small but steady dividends but their main talent is their amazing share price growth.

    Perhaps this way of investing can be seen as having my cake and eating it too. One method, rapid cap gain, feeds into another method, high reliable dividend growth, and in about two or three years, I expect that all of my positions will be at that same maximum figure if current conditions continue. But if current conditions do not continue and even if they drop in value, then I can easily wait as long as I need to by relying on those steady dividend payers which are the reliable core positions I am interested in at my age because they pay all my bills. I have this portfolio because I want to have a reliable and increasing and predictable dividend income and it is the core that does it for me. I read a lot of Chowder - can you tell?

    A while ago, Chuck Carnivale had some articles on stocks that had low yield and high cap gain and I mostly did not want to think about them because I was so focused on the dividends in my core positions for my retirement portfolio back then. But now I can see that having a mix of stocks in a portfolio will allow a dividend growth investor to get to their investment goals a little faster in some cases. In my case, with my portfolio, I only decapitate these "feeder" stocks when they have grown to a certain size so I always catch them on the up swing without even trying to time the market. They must grow to my magic number and when they do, I sell 10% and reinvest it elsewhere. The money strengthens my slower growing higher yielding old lady steady income stocks. It is all good, you see. Good for me. And I am, after all, the one in charge.

    It is easy to see when the share price is above my size limit. It's easy to phone up the company and ask them to sell 10% of my shares. I already have a list of positions in my portfolio of high yielders that are at fair price or even at bargain price so I already know where to reinvest the decapitation money. Then it's easy to wait a few months and do it all again always reinvesting most of this money in my core positions of high yielders and other grandmother stocks.

    I should have all 10 of my positions full in about 2 or 3 years more or less. But if the share price of these "feeder" stocks drops, I can wait easily and know all the bills are paid easily by the core grandmother positions like T and other stocks that pay reliable high dividends. I do not care what their share price does so long as the dividends are paid each year and they grow faster than inflation. They are my income and I will likely never sell them. T, CVX, MCD, GIS, etc.

    When all my positions in this portfolio are full to my magic number, likely I will again change my investment plan and then allow the winners to just run and only decapitate them when a grand child needs money for college or there is some other special need. These kids range in age from 14 down to 2 so they are well spread out, thankfully.

    I like it that I am in charge, I can grow this portfolio in whatever way I please and changes can be made as my needs change over time. When I started investing back in 1978, I used to think it was almost sinful to sell any shares ever. I am now willing to do so and even sometimes I do not reinvest 100% of the decapitation money. Sometimes we spend a little just for fun. It is about time we did that because we are already in our 70s. The core positions cover our basic needs easily. Why not have some fun?

    Everybody had a different idea on what they want from investing. I have learned that my ideas have changed a bit over the years and I am glad my portfolio can meet my changing needs. You take the high road and I'll take the low road but we'll all get there in the end if we read a variety of articles here at Seeking Alpha.

    Peace
    Mar 3, 2015. 10:01 AM | 7 Likes Like |Link to Comment
  • Dividend-Stingy Wal-Mart Was Already On Probation, So What Now? [View article]
    Nice thread here. I will add EMR to my wish list - got a bit of money coming in soon so will start it then. It will be a core position for me (elderly retired) and I will only add at bargain prices. Thanks, All!
    Peace
    Mar 2, 2015. 12:18 PM | Likes Like |Link to Comment
  • Up 56%, Cracker Barrel Old Country Store Is Looking Very Expensive [View article]
    WmHilger1
    The quarterly dividend went from 20 cents back in 2010 to a dollar this spring. That kind of dividend growth is ok by me! The share price has also gone up - from $45 in 2010 to over $150 now. I accept that kind of growth and look forward to many more years of holding this stock. I am retired and elderly and satisfied with CBRL.
    Peace
    Mar 1, 2015. 06:27 PM | 2 Likes Like |Link to Comment
  • Dividend Growth Investors: I Have A Few Questions [View article]
    Thanks for this, David. And while I am at it, thanks for all that you do here on Seeking Alpha.
    Peace
    Feb 28, 2015. 12:04 PM | 2 Likes Like |Link to Comment
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