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 try to catch all the comments but am not always notified for older videos. There's really no reason to look at the stock price of an investment because it doesn't measure anything. I did a video on finding good stocks under $5 that explains why price doesn't mean anything. https://youtu.be/F8fheVUkMmQ
I'd use the core-satellite strategy, put about 75% in broader ETFs to get market exposure then 25% in individual stocks. I still like GE and some of the other names but you want to spread your risk around 10 - 15 stocks. Don't forget to have some in bonds and real estate as well.
+Let's Talk Money! with Joseph Hogue, CFA thank you for the reply sir.i will invest on these 3.on KEN looks like just started paying dividend..I will wait and see. I'm just looking at high payouts as possible
I like BPT but don't think the dividend is sustainable, still might not be a bad long-term investment. AGNC is good as far as mortgage REITs go but all mREITs will suffer as rates increase. Probably the best of the three here though. I don't know much about KEN, what do you like about it?
A little late to the viewing party on this video, but I just scooped up some T and I'm holding GE and XOM for the long term. I also have MMM and ABBV in DRIPs. I don't know if it's a factor of confirmation bias, but I feel a lot more confident in my choices. Thank you for your videos! I learn quite a bit from them.
I know you said you don't care for monthly stocks, but have you looked into shaw communications at all? SJR, They pay like 4.95% annually, so around 7 cents per stock per month. I'm using them as consistent income while adding to my holdings in GE, AT&T, and ET
I've talked with the founder and CEO at a financial conference. I like the platform and have used it myself to review for the blog. Hard to go wrong with robo-advisor portfolio because it's all done for you.
Man...life can be bullshit. Here I am. Black in an urban city Detroit. Grew up when it was extremely bad. Drugs ruled the household. They tried to teach me to stay out the gang life-go to school-get a degree so I can work for somebody else. Dependent on somebody to write me a check to live. I knew and I know nothing about the investment game. Nothing about owning a business till 35. I’m 40. Feel like it’s too late. I’ve wasted a lot of years slaving for money. The money is supposed to slave for me
Dude, I can relate. What worked for me is start investing in an IRA. Go to your library and start reading. Don't let your age stop you from making some wealth here. If you are a newcomer to investing, start buying an index fund or a an ETF. One ETF that pays monthly is DGRW. It is a dividend growth ETF from Wisdom Tree investments. When you look at the dividend growth compare the same quarter year over year (example: dividend for first three months of 2016 versus first 3 months of 2017) you will get a nice raise. don't get discouraged.
But let's face it, how many people in my work group have a "Hundred thousand dollars" to invest??? (How many hundred thousands---LOL)
I viewed this video with MUCH interest until you said an investor would reap about $400 dollars on a $100,000 dollar investment!! That's when I lost interest-----still a super video though!!
It's $400 a month which means nearly five grand a year. Even if you don't have the hundreds of thousands, it's still valid. You still get the same solid cash flow and yield even if it's only on $20K. Fortunes aren't made overnight. Long-term planning and saving and you'll get to $100K and then some.
What about being taxed for withdrawing the dividends you earned from the account each month? Is it really cost effective to take that money out each month? Does anyone watching this video withdraw from dividends each month? If so, how much of a bite does it take out of you when it comes time to pay taxes in April?
It's a good question. Withdrawing monthly will mean you pay the qualified dividends rate (usually your capital gains rate). which will mean about 10% to 15% you owe come April. If you don't absolutely need the money, retirement account is always the best option for a dividend paying stock so you don't pay taxes for decades.
My dividends are automatically reinvested currently.
Qualified dividends only in my taxable account. Just look up qualified dividends on investopedia .
Majority of my dividend stocks are in my Roth accounts which are tax free.
Retiring next year with option up to $3k/mo. tax free dividends from about 40% of my Roth 401k.
And about $1500/mo. from Roth IRA.
i know this is an older video but what do you think about G.E. now i have 1 share that was paying 14 cent and it dropped to 1 cent will it have a come back ? today shares are $8.93 each please lmk thanks
I feel your pain on GE, believe me. I've been in it since $12 but have bought more shares and some options on the way down. Not much of a dividend stock now but it's starting to rebound and the sum of parts valuation is easily around $12 - $15 on the different assets. I think it's a good long-term play from here and they'll reinstate the dividend eventually.
I haven't looked at Gladstone though I do have a monthly dividend stocks video coming out on the 21st. I like MAIN, GOOD and SBR for monthly stocks. The biggest thing I look for in BDC companies is internal vs external management. External management means higher fees and doesn't always align their compensation with shareholder interests.
So I'm very new to this and am trying to understand the verbiage and all. I'm thinking of opening Ameritrade account, but have seen ads for RobinHood. Can you, please recommend anything and why would you choose one before the other. Thank you.
I've got a couple dividend stock videos coming out this month and am starting a year-long investing challenge where I'll be sharing my portfolio. As for monthly dividend stocks, check out MAIN - a BDC with high yield though the share price doesn't move much.
No problem. Price appreciation is the return you make from selling the shares (eventually) so the selling price minus what you bought it for.
Yes, to make that $400 a month dividend it would take about $100K portfolio. Quite a bit but can't expect to get rich on 4% yield. I'll do a video on stock price and post it to the channel.
+Let's Talk Money! with Joseph Hogue, CFA Sorry for the late response. Terms such as upside price appreciation?
Also, your plan is based on having 100K to invest?
Another question, what determines the price of a stock? I always wanted to know that.
I like it for a short-term investment on a quick move but not a big fan of the leveraged ETFs for long-term investments. Portfolio manager has to trade the derivatives daily to keep the leverage. That usually results in higher costs and underperforming the 2x.
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.
Is this after you’ve absorbed your (previous) losses in GE? It’d have to reach 25-35/share before that happens for most. No thanks and such a paltry dividend in the interim. If anything, it’s for growth/appreciation at this price, but I wouldn’t touch it with a 10 foot pole.
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.
Great assets - and a path. That path, IMO, is around the world. You’re looking at YEARS to come back - if they do. Look elsewhere like MMM, D, NEE, T, VZ. At present, and likely into our near futures, these companies are stable
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.
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!
Hey. I have been thinking about it for months but I have a full time job and it makes it hard. I do have a solid large portfolio of stocks and I do very well! These you tubers manage $500k or less and do not have that much skin in the game do they just makeup stuff! I dare them to show how much they actually manage and what their holdings are! Ones they start managing multi million dollar portfolio and share all personal picks and perform snce over time I will respect them. I wish I had time to make YouTube channel!! Maybe one day. 😁
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.
+Renee` Hill I would say you were a fool twice. First for buying a brand new car and second for paying a ridiculous amount for a gas range.
I wouldn't say you were very frugal at those times.
Also, If the gas range never worked, why didn't you just get your money back or have it replaced or repaired under warranty?
+Dan Well I wasted $1200 on a gas range that I assumed would be high quality. Fool me once shame on you, fool me twice shame on me. G.E. will not get a 2nd chance with me. In 1981 I bought a brand new Chevrolet Monte Carlo. It self-destructed as it was made during a period when American auto-makers decided it was a good idea to go cheap. Do you think I've ever bought another Chevrolet or G.M. product? Frugal people who manage money wisely will hardly take such a risk.
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.
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