Income vs Growth if you DON'T NEED INCOME - 9 Advantages of Income Investing
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- เผยแพร่เมื่อ 26 ก.ค. 2024
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00:00 Intro
02:09 Advantage 1
03:18 Advantage 2
04:47 Advantage 3
06:17 Advantage 4
07:24 Advantage 5
08:56 Advantage 6
09:56 Advantage 7
11:12 Advantage 8
14:43 Final Thought's
15:41 Forgotten Advantage 9 :)
Mission:
Help everyday people invest on their own in order create their own source of Passive Income to enhance their quality of life and reach Financial Independence (FIRE)
Disclaimer:
I am Not a licensed investment advisor, financial planner or financial advisor. Video is for educational purposes only. The information in this video should not be considered tax, financial, investment, or any kind of professional advice.
#passiveincome #investing #dividendincome #financialfreedom #livingoffdividends
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Nice list !
9 Advantages Income Investing has over Growth Investing
1. Not dependent on the Stock Market
No need to buy low, sell high... income every month.
2. More flexibility
Don't have to try to sell high, to buy another low oppornunity.
You could reinvest your dividend into same ETF, another ETF, use it for your expenses, or hibrid of those.
3. Avoid 3 major (questions) dilemmas growth investors face
When do I sell ?
What do I sell ?
What I do with the money ?
4. Hands-off strategy, save time! (The ultimate asset)
5. Outperform in a flat & down stock market
6. Peace of mind during the bad times - Priceless
7. Will help you avoid panic selling
8. Safety net in case you lose your job
9. Potentially outperform growth investor
Started my PII back in 2018. I Hold many popular Covered Call & Splits, likely same as many of you. I was fortunate to buy many at the low of Pandemic and added more during 2022 route. On top of monthy income, I have realized pretty good price appreciation as well. I am now just shy of $60,000/year of PI. I retired at 57 and still have CPP & OAS to look foward to.
Trust me Adrian is correct!
congratz! enjoy the Passive Income!
Wow! Where did you learn all that ?
Im 51 and want to take the best path...on the fence between growth & passive income...I do not need to touch the funds either way...I can retire at 58 with an average pension....thoughts?
Love how you repeatedly teach the importance of staying calm in uncertain markets! It’s like having a calm, cool captain steering a ship through a storm ⛈️
Love it ❤
point #8 CANNOT be stressed eneough! I've been given my notice! Had I not been making around $1600 a month, I'd be VERY stressed! Glad I started PII !
Peace of mind is underrated. Having that income every month to re-invest or spend is just another means of achieving growth. Now versus later.
I enjoy income investing for all the reasons you’ve mentioned.
My portfolio is down, but I don't care that much because the dividends are consistent...and I can reinvest them, or take them out if I need them. Part of my new attitude is due to Adrian's channel. So, thanks!
Same hear! With the Drips in place I'm taking advantage of the down turn.
Thanks for sharing!
Your common sense is underrated my friend
common sense is underrated in general now a days :)
@@PassiveIncomeInvesting That is so true 😁
After a few years of stock guessing I discovered your channel. I can't emphasize enough the piece of mind that PII brings. My snowballs are growing at a tangible rate and I owe it to you. Thank you Adrian and Erica for what you do and how transparent you both are. Very much appreciated!
happy to be of service! stay passive
1. Covered calls ETFs depend on the NAV to generate option premiums, so there's also a strong reliance on the stock market. Secondly, it's important to look at this from the lens of growth investors. Dependency on the stock market is a desire. They don't see this as a negative.
2. Growth investors don't necessarily want flexibility. It's not passive to figure out where to reinvest the income. In an accumulation phase, they just want to DCA into S&P500 for example.
3. The decision of when, how, and what to sell is irrelevant if one is simply DCA'ing into a growth ETF.
4. This is a duplicate of point 3. Growth investing can also be hand-off. Just DCA, and no decision-making. DCA buys more shares when the market is down. Growth investing is not always about stock-picking. Both growth and income investors can stock-pick or buy ETFs.
5. Covered calls ETFs generally win in down markets, but the stock markets spend more time in the up markets.
6. My counter is that the covered calls ETFs' distributions can and do get cut. Income investors are also susceptible to panic selling when both the capital and the distribution are falling in down markets. Regardless, I feel experiencing panic selling at least once in your life isn't a bad thing. Just let it happen and learn from it.
7. Duplicate of point 6.
8. (Job loss). This is no longer a "don't need income" situation. Switch to income if severance and EI are not sufficient.
9. EIT.un is an exception. Statistically, we expect some income funds to outperform. The problem is, no one knows which will outperform next. In a diversified portfolio, EIT.un may represent 10% of the portfolio. If the other 90% underperforms, the entire income portfolio still underperforms.
Happy New Year Adrian! 😃 Already received couple dividends from my PI portfolio. That's the advantage of being a PII. Another advantage of being a PII is that the gain is real unlike that unrealized gain nonsense. One day up, two days down, and back to square one. 😤No more of that. Now, I can finally say I am making money while sleeping. 😄
Loving PII so far. Wished I had started in my early 20s.
Thank you for the insight!
Great video! Thanks so much 🙏🏻
Agreed. No job is super safe at all. No.matter how happy you are at your job, it only takes one bad manager to come onboard to ruin it all for you and make it more stressful than you ever thought. Great strategy to go passive and be in the driver seat.
Great video Adrian. Happy New Year. I hope you 2 are doing well.
Happy new year!
It makes sense! Thank you, Adriano!
Thanks Adrian and Erika
Thanks for sharing awesome tips! I'm financially free and currently growing a solid retirement plan. It takes a positive and consistency to learn new things, unlearn the old habits is important to get a mentor/coach to lead you all the way. It's great to start young too!
Man, you are a gem of a person. Thanks for what you’re doing!
Watched and liked, thanks Adriano!
Thanks for the video
love this strategy and what Adriano has to say. Love it! been part of the PII family for just over a year now and it was such a great decision! keep up the great content
Honestly Adriano thank you for clarifying it all and breaking it down 🙂
3 examples on the very last point are HDV, DVY, and DGRO .. these are dividends ETF i would buy for growth not income.. of course taking into consideration the yield not only the price
thanks for the video. good tips on the advantages of income investing.
Great video. Content is awesome. I am glad I watched the whole thing.
Great video! You are right on about this topic! I love income investing!
Really interesting information. I hadn't heard of covered calls before discovering your channel. In 2022 I moved my investments from being in MFs with a big bank where the "advisor" provided absolutely zero advice. Now that I'm learning about covered calls, etc., I now need to consider moving my investments again and I'm torn about this. Thanks for all the great information!
income strategy is my current plan and I'm assisting my children towards helping them setting up their future with investing into dividend funds , ( mostly income funds and diversified etf's) not too many if any individual stocks.
9 also a reward for those who finished the video, the advantages are re assuring for a second i thought you're planning on buying growth stocks...which are also good but when to sell an added stress for me.
Nice video it is very true.
Great video ..and the best way to show my appreciation of this video and your other videos , is for me to continue to push the thumbs up button.😊
appreciate you!
One can invest in growth ETFs passively. It doesn't have to involve constant selling/buying.
no but it does involve selling them at one point does it not? so when do you sell? how much do you sell? and what do you do with the $$ afterwards?
@@PassiveIncomeInvesting When the time comes to start drawing the income, the growth portfolio will be so far ahead of the game that the timing and quantity of the withdrawals will be happy problems. And secondly, one can always switch to a passive income portfolio during the decumulation phase.
Very very good video !
I love your channel and your community. 🤓
Thank you so much 😀
Always great content! I will be sure to set up a meeting this year with you to help steer us in the right direction. Thank you for sharing all your strategies its a gift.
looking forward to it :)
Great points Adriano. I can attest to some of your points. I started a DIY investing 2020, and I was concentrated on Growth investing. It all change when come across your video, now no looking back on growth, I'm all PII! Thank you for all your insights. #1FAN
Thanks for sharing!
Hey Adrian...great video...cant wait for the other one about switching investing styles and potentially selling at a loss...which ties into what I am facing now with the 40k I have in growth...
th-cam.com/video/fEZQaIaFims/w-d-xo.html
HAPPINESS IS A POSITIVE CASH FLOW.
very well explained - You are earning lot of blessings for saving our time and money and - peace of mind
Hi there
Which app u use for dividen tracker. Any suggestions
Liked!
Good video. During the down market I feel like #9 could pay bigger dividends if the market stays like this for say 5 to 10 years and once the bull market happens those dividend paying stocks might increase how much they pay thus you might see a larger return.
Hello Adrian. For example, let's say you have $10,000 starting investment what would you do? income or growth?
well with income... you can accumulate more shares....
Great video like usual. Wish I found you method years ago. Way less stress of stock picking. Less time wasted. More motivated seeing dividends rolling in. Better "job security". (Experienced Nortel layoffs 2008).
Thanks for your openness financially and personally. I think you should come back to a Montreal winter to better appreciate Panama though. ;)
trust me... i did 35 Winters in Montreal, that's 34 too many :)
@@PassiveIncomeInvesting Good one. I'm touching it out. Lol
Adrian what’s going on! Happy New Year! 🎆
Same to you!
I can think of additional advantages but 9 is more than enough.
Hey! I really like your approach, just found this channel and its a gem! What would be your distrii between Dividend growth and income inside your portfolio? Is it full income or some part is inside div growth?
100% income. welcome to the channel
waht do mean that you dont need the marketn. Covered call generate income by sell options, if the market is in a downtrend how do they make moey o diminishing caal options?
its typically the opposite.... options premiums get bigger with more volatility.
Because there will always be people that think a stock will go up and are willing to buy those call options even during a downtrend market.
Great video as always. Quick question Adrian, I have a zoom meeting with you in the near future..I'm in Alberta, what time zone are you in? I take it the booked time is in your time zone?
all appointment times are in EST like it says everywhere on my website :)
Hey adrian i come accross by accident in u tube. You are good teacher man...keep it up and 100 percent agree with both hands what you say. How to connect with you..
thanks man!
Adrian you did not address selling for a loss to get into PII ? Is this something you would do? what % is your pain threshold? Is is based on projected Annual Yield to Cost?
video filmed and ready to go.... sorry but I have a backlog. its coming !
Great ! Pls let us know when it drops
If my TFSA is maxed to my contribution limit, am i still allowed to reinvent the dividends?
the answer is yes, what happens to monies within the fund dont affect your limit.
yes
Great video...however I find that I am facing all the disadvantages stated with what to do with my 40k of VFV....will I sell & when...as well as the time taken and stress involved with it... as I intend to put those funds into PII EFTs...thoughts?
only you can make this decision :) what is your priority? Income & Less Volatility or a Histrionically Proven Max Growth over time Strategy?
Whatever would give the best return over the next 7-8 years before retirement ...I could crunch hypothetical numbers all day...but would rather make a confident decision based on expert opinions and go from there....rather than the stress this decision is currently putting on me....
I don’t get it QYLD is down 33% in 5 years even at 10% yeild all you made was 18% in 5 years
whats not to get, its the Nasdaq 100 with covered call writing. its designed to provide max income off the NASDAQ100 while giving up most of the upside
@@PassiveIncomeInvesting QQQ would have been a better buy
I really like Hamilton's ETFs. I also like this channel for its openness. It's 2023, and I'm looking forward to and hoping for, a lot of recovery in the stock market. I'm looking for ETFs that hold Chip manufacturers like Taiwan Semiconductor. With the supply chain being reconstructed, Integrated Circuit manufacturer stocks IMO should rise greatly.
💥Happy New Year💥
i really like.... YOU! :)
13:02 you worked at CGI? I feel sorry for you. You are way to nice to work there
lol
Had a question. If the market is performing well, then should we step away from covered calls?
not necessarily. I just BUY and HOLD this strategy long term no matter what market conditions are present. Its not called Passive Income Investing for nothing :)
All you need is apple MSFT google watch in 30 years how much richer you become
lol maybe 20 years ago, does not mean they will do the same thing in the next 20
@@PassiveIncomeInvesting they will nobody will beat them and if they try they will just buy them out that easy
Are there no negatives for PII?
Yhis was a very unbalanced video. You need to learn how to present both sides of an argument.
He already made another video talking about this I remember one was clearly the management fees
Terry, this video's topic covered what the title stated. It does not mean there are no negatives to PII. I made this video a while ago. th-cam.com/video/A8sp1YV_isw/w-d-xo.html - P.S. try wording your comments in a way to see less arrogant.
Passive index total market ETFs will always beat income investing in the long term due to a much lower e.r and better diversification over all type of stock including small cap growth and value. Ben Felix has a great video on that.
A balanced stock bond portfolio also allowed for withdrawal of money when the stock market drops. This iswhat short term gov bonds are for. Do you suggest a SWR of more than 4% with the income strategy that is sustainable for decades? Is this supported by and peer reviewed research?
are you sure about that??? nobody can ever predict that. which is why I invest the way I do
I really want to like your strategy but the more I dig into it I can't get around the situation of capital depreciation even when you explain it away. I took an etf like EIT and subtracted the capital loss since inception against the dividends received and it added up to about 2% per year gain since inception of the etf. I did this with a few of the others and come out with a 2% gain every time. by reinvesting some of your dividends you are giving yourself a false sense of gain by growing you income through reinvestment, but you are still only gaining 2% a year overall when you subtract capital losses. It seems better to just invest in spy for the long term and sell what you need for income each year never taking out more than 8% or so of your holdings. you would be further ahead in the end. I wish this was not true because indeed your strategy is incredibly simple, but it also involves an aspect of burying your head in the sand in regards to your capital erosion over time.
looking at stock prices for income oriented funds makes no sense, look at the total return. EIT is beating VCN, XIU, ZCN
th-cam.com/video/nIsZrDCx0jQ/w-d-xo.html
Think of it as if you loaned your buddy x amount to buy a luxurious sports car and he told you he would pay you back the price of the car between a and z amounts each month until the end of time. He also says at any time you can take the car from him and go sell it. It may be wrecked and he might need more money to fix it up, or that car will go up in value.
yes this is why i stay away from covered call strategy at the money. I like out of the money covered calls that pay a smaller premium, but allow room for more upside each month.
Lay offs are crazy right now, it’s all over. Especially tech industry
they are BS layoffs :)
The logic in this video is slightly insulting. First of all, out of the "9" advantages, there are actually maybe 5 when you exclude duplicates or paraphrasing other points - and some are just ridiculous. For example, the first one "Not dependent on the Stock Market" is a straight up lie. You could say "less dependent" and then it would make sense. Are those funds somehow magically immune to significant volatility and cutting their dividend/distribution when shit hits the fan?
Secondly, hands off approach and that "buy and hold" nonsense? Man, you're *constantly* buying and selling and tweaking your portfolio, and you'll just keep jumping on one or the other income fund as they come. Not exactly hands off, is it? What is really hands off is DCA-ing into VGRO/XGRO or VEQT/XEQT for example (in fact that can be automated). Disclaimer: I don't own either, I'm just objectively trying to point out what actually doesn't require any effort.
And that last point is just laughable and I wish it had remained forgotten. It can potentially outperform growth investors? Of course it can, especially when you cherry pick a couple of terrible years.
Just to be clear, I'm not a growth investor nor I think it's a good strategy for me personally. I'm actually leaning towards PII, but I still prefer a presentation to make some sense, or at least be truthful. Having only advantages and no disadvantages whatsoever wouldn't fly even in a frickin' middle school essay let alone here where people are looking to invest their hard earned money. It just makes you look like a cult leader.
To finish off with something positive - yes, not needing to worry about timing the sell is a real and big advantage, and that's pretty much it. After all, the title of the video is "if you DON'T NEED INCOME" in caps lock, so why are you even talking about selling? The premise of the video was having a job that pays for all your living expenses, right?
for your first point.... nothing is ever 100% but you are definitely much less dependant on stock prices with the strategy I use. 2022 proved that already. Volatility helps covered call solutions do better as the premiums are richer. this is why they outperform in the bad times.
for your second point, it is a BUY and HOLD strategy. when I buy something i intend to hold it long term. But if i see some other fund i can swap into , i can do it. Its still a BUY and HOLD approach. think of the overall picture (it seems like you have a hard time with that). with XEQT and any growth investment, you pretty much need to sell it at some point to make a profit as they dont give out much income. Unless you have millions in them...
HDIV and EIT are outperforming XIU...a classic growth investment. I did say "could" , not "would" it is possible with modest leverage. so yeah it is laughable because I am laughing at you right now
I seem like a cult leader? why? I just show people how I invest and my investment philosophy.
You my friend, seem like you are bitter and sad... why?
maybe you need some passive income to make you feel happier?
Great video. I'm interesting in learning more of your income mindset. Thanks for sharing. Question - Isn't EIT-UN.TO providing higher yield (vs XIU.TO) due to Dividends and Return of Capital?
Funny that just after watching this video, an opposite video from Ben Felix just appeared on my list. I would strongly recommend it to contrast the strategy.
th-cam.com/video/9j6DInAMMaM/w-d-xo.html