How I created a monthly income stream from passive dividend investing.
There is no investing strategy more popular than dividend investing and for good reason. Dividend stocks outperform the rest of the stock market and put cash in your pocket. Dividend investing is safer than other investing strategies and will help you reach your investing goals.
The only problem with dividend stocks is that most companies only pay dividends four times a year. That makes it difficult to create a monthly stream of income from just dividends. In this investing tutorial, I show you how to create a source of passive income from just four dividend investments.
You'll not only get constant cash flow every month but will benefit from price appreciation for double-digit returns. Stop chasing stocks and worrying about a stock market crash. Learn how to invest in dividend stocks.
This dividend investing tutorial will not only explain how dividends work but will show you a dividend investing strategy that includes monthly cash flow and upside returns potential. Learn how to invest in dividend stocks for income and double-digit returns.
Includes four picks for the best dividend stocks of 2018 and how to invest in all without losing hundreds in fees. Whether you need retirement dividends or just to grow your portfolio, don't miss this video!
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Joseph Hogue, CFA spent nearly a decade as an investment analyst for institutional firms and banks. He now helps people understand their financial lives through debt payoff strategies, investing and ways to save more money. He has appeared on Bloomberg and on sites like CNBC and Morningstar. He holds the Chartered Financial Analyst (CFA) designation and is a veteran of the Marine Corps.
Depends on what kind of a rate you can get on a home loan. I wouldn't pull out all the equity, maybe leave a little cash cushion and make sure you can afford the payments. Smart thinking though, always have your money working for you.
I use Ally Invest for most of my investing, one of the lowest commission fees available. Save money each month for investing but then only buy stock maybe two or three times a year. Will dramatically decrease number of transactions and you really won't miss out on any returns.
I know a little more than most . All I have to say is if you own GE NOW, you are in for a lonnnnnng wait. ALSO, you aren't out of the "RISK" factor yet as there is much more cloud cover for GE. Layoffs are coming for employees. Stock and bond holders may get hurt. Rebuilding to something of a profitable conglomerate is at least 2 yrs away.
Uh, yeah, seriously. Let me guess, because the stock price has gone down that makes it a bad investment. Make sure to come back in a few years when the price has rebounded to $20+ a share and admit you were wrong.
I don't mind that the stock prices have fallen as it is impossible to predict even though this guy is promising doubling and tripling as a matter of fact. It's pretty egregious to recommend GE when many analysts were expecting massive cuts to dividend. I demand an apology!
Dividend wasn't zero when this video was published. In fact, GE was one of the best dividend stocks for decades. Go ahead and point me to your investment analysis published and let's look at your track record.
+Let's Talk Money! with Joseph Hogue, CFA ohhhh, hanging your hat on some designation I see. How many of those peers with the same designation beat the market year after year for decades? Try nearly none!
Should I buy GE at 6 dollars... usually companies have expirie dates as well. BEZOs said amazon won’t last forever... ugh Thomas Edison would be rolling in his grave if he saw what these guys are doing to his company.
I like your strategy but why did you focus on Stocks that do evil in the world? GE builds weapons of war that kill human beings, Exxon Pollutes our environment etc. I prefer investing in dividend stocks that actually improve world conditions instead of lead us to a death 💀
I think he focuses on those particular companies cause they're SOLID and SAFE and PAY DIVIDENDS!
GOOD comment! You can not have it both ways in this type of scenario, and all corps are evil, on a certain level!
I appreciate your comment but think you're off on what these companies do. Exxon fuels that car of yours and so many other things. GE builds engines, power turbines and a lot of things but it doesn't make weapons. Do a little more research.
Stopped watching after you recommended GE. What a loss. GE is in is much debt. I would wait for it to hit bottom before I would buy it and for the growth potential no the dividend. I would suggest a nice utility that pays 4% until that happens. Not all monthly payers are BDC's. Some are REITS and they have to pay out a huge percent of their earnings a dividends to comply with the law and they are not all in debt.
Let's Talk Money! with Joseph Hogue, CFA
It is correct, that no one knows when a stock will hit bottom. But, it is not flawed to tell someone to wait before they bought in if you think it will continue to fall. Then again it is cheap at this point and if I was 30 yrs younger I would certainly be buying. I guess I need to stop speculating on its growth potential.
Depends on your goals. If you're a long-term investor, you can probably just not worry about stop loss orders and enjoy the ride. If you're worried about short-term returns then might try a stop-loss around 5% lower or just cover the position with some options.
GE is trash. Look at the history. Better off burning your money. XOM is as dieing stock as Electric Vehicles are the future. T is undervalued and a good dividend stock. DVY is okay, but SPHD is better. If the goal is monthly income I would pick SPHD, BST, O, and MAIN. All have a history of dividend increases and you get real diversification with monthly income.
+Let's Talk Money! with Joseph Hogue, CFA I agree most BDCs pose risk, but MAIN has consistently beat the market and they raise the dividend every year. 19.5 cents per month like clockwork and 2 special dividends per year.
I like Realty Income and the SPHD fund is a good sub but BDCs like MAIN are risky and dividends are volatile. Simply 'looking at the history' of a stock will get you nowhere and GE is still a good turnaround play.
Hello. It's Thursday, November 15, 2018. I enjoyed your video. I am thinking about buying dividend stocks for some monthly income. I will be a beginner. So what it the best dividend stock to buy as a beginner and with limited income? Also, what do you think about the Robinhood app? I'm thinking about joining that one too. I will be watching more of your videos. Keep up the good work. God bless you and have a blessed evening.
I know a few stocks that are constantly better than these, but... my secret. :) it is always good to hear what others have to say and advise. Never be arrogant and always have an open mind. Good video to reflect if your picks are good in the future. Only way to learn is from doing.
Can you do a video on how to see if the stock is undervalued or overvalued and how do you figure that out. Explaining concepts like price to book value etc would also help. Was wondering when did you complete level 3 of cfa. How much time did you dedicate for the 3 levels and what, if any, resources did you use to study for the exams.
Would love to hear from you. Great video btw!
Will put a video together on some valuation techniques I use. Good to have you in the community, btw.
Got my charter in 2011. I spent about 300 - 400 hours on each of the exams, about 10 hours a week and usually started studying in Nov/Dec. Just used the CFA resources for level three.
What good does it do to own anything that loses much more per year in value than it pays in "dividends?" It would seem to be better to leave the money in a jar in the kitchen and takes the miserable 1/12th of 3% out each month. 😐
I LITERALLY just bought 5 Shares of GE BEFORE wandering to this Video. LMAO! I dropped 400 into my new Robin Hood Account and the last Buy Order I did was 5 Shares of GE at $10.16 Each.
I did it because GE has been around forever, because I've moved to Mass just last year and it's a Mass Company, and because I'm ONLY buying Dividend Stocks.
I also did X1 of TXN, X3 of T (AT&T), X1 of VYM and X1 of VYMI. That ran me right at $390.
Going to let that $10 sit there, and on the 1st I'll likely do another $300-$400 and do that every Month.
Now I can't wait to see your other Picks, see how many I got on my own and how many you suggest that I hadn't thought of to add!
This is madness people!!! Stop and read this! Stop the madness please! If you are buying 5 shares of this and 3 shares of that etc stop wasting time! Put you r money in ETF untill you have enough to make individual stock picks! Most(but not all) these YouTubers put out videos to make money! Most will say anything and do anything to gain! This guy said AT&T is a good pick! He has another video now that says AT&T is bad and will cut dividend. These people go where wind takes them! No solid investment strategy! This madness almost makes me want to start YouTube channel to give good solid advice! This is non sense!!!!
Sold my GE, and my TXN the same day I bought them. TXN is a fine company, with good Dividend Growth over time. But the Dividend is to low right now... I flipped that TXN into 3 Shares of T instead, which will Pay Out much better. And the GE doesn't fit right now with virtually no Dividend.
I need the Dividends NOW so my Stocks start buying me Stocks.
So far I have invested $1,000 over Oct and Nov.
CCLP (X30), OXLC (X10), GLAD (X10), MAIN (X1), F (X7), T (X7), VYM (X1), VYMI (X1), FUN (X2), XOM (X1) and NYMT (X3).
This has my Next 12 Months Dividends set at an expected $81.76.
The plan is to get December Ex-Dates in December. Only ONE of those does not Pay Out in December. So most of what I Buy will Pay Out DURING December, to increase my Buy Power in January.
OXLC (X10), MAIN (X1), VYM (X1), VYMI (X1), FUN (X1) are all Ex-Date DEC/Pay Out DEC, and the NYMT (X23) is Ex-Date DEC/Pay Out JAN.
This will give me $9.43 in Total Dividend Pay Outs in DEC to Invest in January. These Investments add $3.20 in Dec, to the previous $6.23. The NYMT adds to January's Dividends, pushing it to $8.24, up from the previous JAN Expectation of $2.84.
That's right at a 'Dividend Buys' for a F or T.
It raises my Next 12 Months Expected Dividends from December forward to $134.61.
I could have went well over that Expected $52.85, my previous Buy Plan netted closer to $68.00 but I realized I wasn't paying attention to the Pay Outs, and I wouldn't be getting most of that until FEB... so not able to Reinvest it until MAR. That would be dumb, as it wouldn't really be helping my Buying Power for 2-3 Months.
There are a lot of things to consider when Buying. I had a Vision. My Plan however was not really going towards that Vision. I was trying to get Dividends NOW to increase Buying Power, but really was only Planning for Stocks that bump the 12 Month Expected up with no regard to WHEN I get those Dividends to Reinvest. That's a bad plan as far as my Vision is concerned. So once I recognized that, I had to work a better Plan.
There is the overall look of your Portfolio... then there is the Practical Application of your Portfolio. My overall look was awesome, but breaking it down it wasn't working very Practically for me to achieve my goals.
So I've refined the plan, and while the Overall Look may not be as sexy, the Additional Buying Power each Month is going to have a far greater Long Term Impact, and a better Immediate Impact... Long Term due to the nature of Compounding, and Immediate because I can focus on Ex-Date/Pay Out Date Stocks that will give me a Same Month Dividend on what my Dividends are Buying.
+Dan Pope Not sure if you were asking me, but I'll field this question. I'm on a Budget. Most Months I'll be doing $500, but other Months I may have more or less due to fluctuations in certain bills... Power Bill goes up in Winter, have to get Oil in Winter for the Heating, etc.
I look at the Ex-Date on the Stocks to see which ones I need to be buying in a particular month. Then I try to spread it fairly evenly through the Stocks that are 'open' for me that Month.
Now not all Ex-Dates are in the same Month as the Pay Out. F for instance has an Ex-Date TWO Months ahead of the Pay Out. That sucks. NYMT has an Ex-Date One Month ahead of the Pay Out. So they get less focus than an Ex-Date that has a Pay Out THAT Month.
Because I want the Dividends available on the 1st of the following Month to increase my Buying Power. But with the left over I focus on the Longer Wait Stocks, like NYMT and Ford. I always want at least 1 New Share per Stock if I can, and certain cheaper Stocks I try to Stack in X10/X20 Units per Purchase.
So how many Units I purchase is determined by how many different Stocks I'm buying that Month, and the Cost of each Stock. I try to invest a fairly equal amount into each Stock, which means the less Stocks in the Month, the more each can get.
I'm looking at GE as a long-term investment. There's no talk of real cash trouble to the point of insolvency and the break-up value is at least twice what the shares are at right now. Was a great dividend stock for a long time and will get there again.
+Let's Talk Money! with Joseph Hogue, CFA That's not how all stocks work. Do you believe everything they teach you about asset allocation? I question if you even own GE. GE has changed materially in the way it's viewed. It's no longer an income stock. It's not even a growth play. Stop pitching bowwow stocks. Some idiots are actually believing you abour GE and are losing a ton of money!
+Not Used No but I can see the long-term value in their assets and the things management is doing to right the ship. Don't care how low the price goes over the next year because I know it will rebound eventually.
And I bought more shares. When the stock jumps over the next few years on turnaround plan, make sure you come back so I can laugh too. Or you could try being constructive and name a few of your own dividend stocks...
AFTER the fact? You serious? Look at when this pick was posted and look at GE chart? Anyone with some investment knowledge would know NOT to pick GE for dividend! For value and long term potential maybe you can argue! He even mentions in video that GE CUT dividend!
Want me to pick a stock and you see it in 2-5 years? Ok LMT, MMM, KMB, PG, BX, BLK, etc. I own 40 dividend stocks! I get $70k/ year dividend income!!! And growing! And I am 39 years old! This guy probably manages $100k and puts out these nonsense videos for people like you!!! There are some good YouTube channels who give solid advice! This guy is probably worst I have seen!!!!! Don't blame him though....he just says stuff to make a $ out of you! He is a hustler just hustling!
Hello Joseph ! My ultimate goal is to reach around 2K in dividend payments every month as a means of second income, I’ve watched a lot of your videos and am really inspired. I stared a Robinhood account and have portfolio value of $150 with stocks in GE, AT&T and XLF, what do you recommend I do to reach my ultimate goal
$2K a month in dividend payments is an ambitious goal but doable. On a 4% annual dividend yield, that means about $600K in an account of dividend stocks. Not something that's going to happen overnight but maybe over a decade. Just as much as the dividend paying stocks, I'd look for ways to increase your income so you can invest more.
I did VYM and VYMI (International), but will be adding DVY as well. VYM and VYMI are the same thing as DVY, just a different bundle.
I bought 5 different Stocks today. GE (X5), T (X3), VYM (X1), VYMI (X1) and TXN (X1). Ran me right at $390.
On the 1st I'll be putting in another $300-$400, all in Dividend Stocks. I'll be adding DVY and XOM for sure, and with December not being to far away may target my December Pay Outs to stack them up a little.
I want to add at least 1 New Stock/ETF every Month to keep spreading out, and add more Shares to Existing Holdings every Month as well.
Especially looking to hit GE and T with $100 a Month due to the combination of Value and Dividend.
We'll see how it goes.
Please continue to point out good dividend stocks. It is very scary investing at a time when stocks are at an all-time high. Advice is needed in avoiding stocks that would quickly tumble in a falling market.
Sure thing. I love dividend stock investing but yeah things are getting expensive. Check out the video I did earlier this month on warning signs for a dividend cut (that stock was down 8% yesterday alone) and the market crash live stream from last week.
No...big no. Loans on your 401K mean you don't get a lot of the benefits from the program until the loan is repaid. You can't contribute and have to pay it back with after-tax money. Max out your 401K employer match but then any extra you can invest, start on your dividend portfolio.
Yeah, I think the new CEO is a good decision. Flannery made a lot of good moves but he just didn't have the support of investors. A new head is about sentiment and keeping the dividend yield. Could still take a few years but great long-term investment.
Love BX as an alternative to BDCs for solid dividend yield and less risk. It tends to be more cyclical than other financials (i.e. banks) since it's more market-based so might be a little weak if the economy turns in the next year or two. I think you can start a position now while holding some money back to take advantage of any selloff over the next 18 months or so.
I really like MLPs as a part of my dividend and cash flow portfolio. They've been volatile since 2014 but solid long-term payers. Enbridge hasn't gotten credit for its consistency and good management. Management has committed to bumping the payout 10% annually and can do it at a coverage ratio of 1.8-times. The Line 3 replacement should come online around 2022 and will mean huge growth and solid cash flow.
Here's a scenario:
What if your money's limited, you invest expecting a constant cash flow but the market crashes when you most need money? Then what when you need that money back and can't get it back because the market crashes you can't get that money back? Then what? Not smart to invest in the stock market, way too risky! It's a risk some of us just aren't willing to take
That's why you don't invest money you're going to need within the next three to five years in the stock market. That money should go in short-term bonds and other liquid investments. You also need an emergency fund for unplanned expenses. At any rate, you should never have all your money in stocks anyway. Spread it out in stocks, bonds and real estate.
The BDCs are tempting on the dividend yield but often the shares go nowhere and any liquidity issues can send them falling fast. I prefer to balance investments between dividend and price appreciation but hard to argue with a 12% yield.
I highlighted AT&T in a recent video on danger in the dividend payment. Just keep watching it if you're not ready to sell. I admit it's a persuasive dividend stock and a really high yield. Just too many warning signs for me.
How funny that you say so because I have the ones you mentioned in my own dividend portfolio :D. Personally, I really like them and like I just mentioned to Joseph, they've really stood the test of time. Also, I think it's important to consider whether it's a personal fit for you or not. Some dividend stocks you just like more than others.
I supplement my dividend portfolio with these 5 canadian banks - The Bank of Nova Scotia, Bank of Montreal, Royal Bank of Canada, Canadian Imperial Bank of Commerce and Toronto-Dominion Bank. I think these 5 will do well long-term but as always you gotta stay updated in case something unexpected happens :). Cool fact: Bank of Nova Scotia has paid out dividends to its shareholders since 1832.. that's pretty impressive and the banks' banking system is world-class. They've really stood the test of time.
Personally, I've never liked AT&T... so I am very happy I never invested in that corporation. I like the canadian banks and ''diversified'' dividend funds such as - VYM, VIG, DVY, DGRO, HDV and O'Shares FTSE US Quality Dividend ETF (a new one that I believe in).
Home Depot, J&J, Mcdonald's and Pepsi are a few other ones that I think will do well long-term. I also like Colgate-Palmolive Company.
I have a few investment accounts, mostly to take advantage of initial bonus offers. I use Ally Invest, ETrade, TDAmeritrade, Swell and Lending Club. Not sure if any of these are available in the UK though.
bow tie!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! Best right now for Div KO, KHC ( down from 70 to 55), T ( 5.8% div like he said), PG. GIS ( 44 from 65+) and a nice 4.5% div, WFC, BAC you need two Bank stocks to off set the rate hikes. you could go Goldman in place of the two bank stocks. I'm out and good luck!!
I like the financials, especially community banks and WFC. KO is a solid dividend yielding stock. Heads up though, I changed my mind on AT&T and just published a warning video last Wednesday. Make sure you check it out.
I think the big question is when do these "good stocks" all bottom out and keep going up. It might be a few months and they go up or they keep going down for while. I guess the whole point is if the will the check I get over the next few month cover cost of investing? when can I the average person afford this / when I can afford to invest? When do I see a return on investment? make a second vid and try to answer these questions. There down now there good to buy but whats the buy in cost? some of these stocks have a lot of conditions for new investors.
Yes. If you withdraw before 59 1/2 years old, you face a 10% penalty plus taxes owed on your investment. There are a few exceptions but you'll still have to pay income taxes. Best off just letting that money grow.
Yeah, the turbine problems were tough but I still think the company has a lot of good assets and is way undervalued. They've worked through their cash flow problems and have the flexibility to get through this headline risk.
Not sure what dividend stocks you owned but you should do better than 5% a year, maybe cash flow return. With price appreciation, it ends up being closer to 8%-10% return. Real estate is a good diversifier but at a cost of management headaches (and you should be getting better than 10% return there as well)
If they're qualified dividends then taxed at capital gains rates, otherwise taxed as income. That's why I recommend holding high dividend stocks in a special retirement account like a Roth or IRA so you pay no taxes on the payments.
Currently long T and looking into the energy space to take advantage of the recent pull back in prices. Given the substantial yield differential between XOM vs RDS (or BP even), what motivated your pick of XOM? Anyways love the channel and love dividends!! 🤙
Thanks. Great to have you in the community. I've always liked the vertical integration in XOM and they seem more willing to go into some of the riskier areas for exploration which can lead to better returns. The pick here was mostly on its dividend payment schedule which fit with the other picks to produce a planned monthly dividend.
Can someone explain the percentage of the dividend to me. Is it percentage of the money u put in the company? Or the price of the stock? (Ex at&t is it 5% of the money I put in or 5% of 30 something dollars??)
The dividend percentage you see reported on sites like Yahoo Finance will be the annual amount the shares pay divided by current price. Since the dividend is paid four times a year for most stocks, you'll receive 1/4 of that every three months. So if you see a 5% dividend yield and the shares are $100 each then that means it's paying $5 a year per share.
Traditional auto maker stocks have struggled for a while but Ford and GM have some good fundamentals that could make them good long-term investments. Just some macro-headwinds to work through short-term.
Yea I'm currently hesitant to jump on the Ford wagon due to the upcoming events with the news, Its on my watch list and I am setting aside money for a possible dip. I see alot of people praising F shares so I was just curious
There's a lot of long-term value in its progress on electric vehicles and the switch to nine platforms from 27 just a few years ago. Shares aren't expensive and pay an excellent dividend yield but there are some near-term worries that make me hesitate. Higher steel and aluminum prices as well as trade problems with Canada and the EU are huge headline risks and probably not baked into the stock yet. Start building a position but spread it out over a year or two.
Is your take on GE still the same today as it was when you made this video? Yes, they're still a good dividend stock for now but a lot of talk of further drop in share price as well as dividend splitting again. Seems to be quite risky right now to invest in this stock.
I think they've stabilized cash flows enough from the spinoffs and divestitures that we don't have to worry about a further dividend cut. Still has some solid assets that are priced well below fair value. It's a long-term hold for me but I think shares will turn around considerably within the next two years or less. Easily 45% to 60% upside on value plus dividend yield over next few years.
Why not GE? You'll have to do a little better than just saying you don't like it.
Dominion is interested but I don't like the valuation or 40% of earnings from renewables at NextEnergy. The administration clearly doesn't care about renewables and regulation won't help it like it has in the past. Plus 23-times trailing earnings is a bit much for a utility (and the dividend yield hasn't kept up with the stock price).
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