UPDATE: I made a mistake in the video... Now the ex date equals the record date (it isn't a day earlier anymore due to the T+1 faster settlement change that happened a few months ago). In this video I drill down into the nuances about if dividends increase your wealth, as there’s more to it than you might realize, and I think you’ll find this information really valuable. I’ll also tell you about a well-known dividend ticker that just announced a split. JOIN my channel membership to access new perks ➡ th-cam.com/channels/uOS-UH_s4KGhArN6HdRB0Q.htmljoin Use my FAST Graphs Link and coupon code AFFILIATE25 to get 25% off your 1st payment for new signups ➡ fastgraphs.com/?ref=GenExDividendInvestor My Seeking Alpha Affiliate Link (benefits change overtime) ➡ www.sahg6dtr.com/2352ZCK/R74QP/ Subscribe ➡ th-cam.com/users/GenExDividendInvestor Share this Video ➡ th-cam.com/video/ucfaDUNwbBo/w-d-xo.html Watch this Video next ➡ th-cam.com/video/F-nKgqu9NV0/w-d-xo.html ➡ DIVIDEND DISCORD: discord.gg/kkSr5FY ➡ TWITTER/X: twitter.com/GenExDividend ➡ INSTAGRAM: instagram.com/genexdividendinvestor/ ➡ PATREON: www.patreon.com/join/genexdividendinvestor ➡ SOUNDCLOUD PODCAST: soundcloud.com/genexdividendinvestor ➡ ITUNES PODCAST: podcasts.apple.com/us/podcast/genexdividendinvestor-podcasts/id1476933524 ➡ DIVIDEND MERCH (10% donated to St Jude): teespring.com/stores/genexdividendinvestor ➡ REDDIT: www.reddit.com/user/GenXDividendInvestor Spreadsheet API data provided by Financial Modeling Prep (FMP). Use that affiliate link for up to a 25% discount (message me if you want to use FMP commercially). Timestamps: 0:00 Intro 0:53 Important Dividend dates to be aware of 2:39 Coca-Cola KO example 4:52 Business revenue/income/divvies 5:12 Stock dividends (as opposed to cash divvies) 5:23 Companies can issue shares to generate capital (distinct, but similar, to stock divs) 6:49 Stock dividend example 8:31 EPS impact from stock dividends 9:51 Stock splits 11:28 Cash dividends 14:10 Reinvesting cash dividends 16:31 Dividends aren’t free money 16:35 My thoughts on divvies 17:17 DCF 17:58 Buffett’s thoughts on divvies & why he likes them 19:43 My thoughts on wealth/divvies 20:29 Examples/articles of people who’ve concluded that divvies increase your wealth/overperform (on average) 21:50 Data showing dividend stocks have outperformed non-div stocks 22:16 Why I prefer quality divvies over treasuries 23:47 Shoutouts & pitches Donate to St. Jude’s Children Hospital: www.stjude.org/donate/donate-to-st-jude.html?sc_icid=header-btn-donate-now Please use my Amazon Affiliates Link before shopping on Amazon ➜ amzn.to/2YLxsiW (as an Amazon Associate I earn from qualifying purchases). Please LIKE, COMMENT and SUBSCRIBE to support this channel - it helps me immensely! Also, please SHARE this video with your friends :) Thanks, I really appreciate it!
My goal is to live on dividends as much as possible to avoid spending down the core investment. Capital retention is the same as increasing wealth I think!
@GenExDividendInvestor a key I use is enough divs to live comfortably then make sure you have as much as possible in a high growth fund so you can let that 'grow' for 2 years then siphon a portion to your divs to increase your take as cost of living probably won't decrease...
@@jamesfrancis7284 That can definitely work :) I'm happy just to own some quality divs -- I end up getting growth and income (I'll show you my portfolio performance against the sp500 next week in my next vid).
Yes, dividends can increase your wealth. Especially if you are experiencing dividend growth that exceeds inflation. Also while building wealth the cash flow reinvested compounds your wealth accumulation
I started a dividend account three years ago. I aggressively started adding new money. Currently my dividend account is the same as my 401k account. Both increase over time and are about 280,000. Currently dividends pay annually $23,061 and the 401k is just growing. Dividends will pay as long as nothing happens around the world to bad. When I use the 401k money and sell the shares, that's it the money is gone. Dividends will keep paying. SSN average is around $1600 a month, mind will be around $1500 if I wait until I'm 67. My dividends are already paying an average of $1984, which sounds better? My dividends have been increasing every year. Every month it looks sweeter and sweeter. Keep investing and you will have good future.
may I ask what is your current capital that pays you 23 k annually, asking so that we have an idea how much to invest for us who are trying to catch up
I think yes but the more relevant situation to me is what you said in the video "when my income exceeded my family's expenses...". That's excellent regards of the wealth question and a more practical (and useful) consideration imo.
As long as the CAGR is higher than inflation and as long as the share price doesn't go down, then yes. Of course, it's also money for nothing (but no chicks for free)
I have my brokerage with Schwab. I am UNABLE to do fractional shares of SCHD and I DO have drip turned on, so, those that say you can, are incorrect. I do stock slices (fractional) all the time - with STANDALONE stocks. Can't do it with and ETF. I am very glad to see the stock split for SCHD and SCHG too!
@@delbomb3131 because other than that, i do like them. Very good company. When I began looking for a firm a few years ago, they had the best ratings compared to others. Hopefully they will make the change so we can do that into ETFs as well.
The value of dividends is it takes the emotions out of the decision making if you want the income. Outside of that, being invested in great companies is best strategy
@cheeseboi6040 I have a large sum of money in a few Yield Max ETFs, and those payments are used to reinvest a certain % back into the funds and the rest in lower yielding assets. My portfolio value still goes up. Obviously, in down markets, all stocks go down but I just buy more while they're on sale..
If you use the dividends to pay expenses and not sell your equities, you allow your equities to continue to appreciate which adds to your wealth. Obviously it depends on what the dividend payout is and what does it contribute to the total return of an equity i.e a larger dividend say from a slow growing utility will contribute more to the overall total return than its price appreciation. lots of ways to look at it. Being retired i dont Drip the dividends as i use them to pay for my lifestyle and supplement SS. At some point i want to have more equity exposure (40 to 60 %) as i am only about 33%. i retired 2 years ago and a couple years before that i was like 90% equities so i began converting to a more conservative mix of stocks and bonds but circumstances with inflation and interest rates have stalled that conversion though i am nibbling at Reits the past year. I am just waiting for more of a pullback to more more money to work in equities (dividend payers).
I'd say it still helps your wealth, as you're using the dividend to pay for your expenses instead of having to use other money (eg salary). Either way, you have more spending/saving power
Yeah they have a program for fractionals coming from reinvestment and the limited "slice" program mentioned above, but you can't easily just buy a $$$ amount of a stock with their normal (or advanced) trade ticket. Whole shares only!
I've found they increase your liquidity and liquidity, in the long term, *is* wealth, as you are not forced to withdraw in order to ''cash out''. If you regularly take them out like they are simply your disposable income, that's a recipe for disaster or, at the very least, stagnation. Dividends are absolutely *not* ''passive income'' as they are not really passive, nor are they ''income'' until you make them into it. I run my portfolio like a business in which dividends are basically operating cashflow.
You know i never actually knew for certain what the "ex dividend date" meant up until now, thanks a billion for the explanation. Is that your Labrador dog on the thumbnail ???, that's my favorite breed.
You're welcome :) I almost was going to crack a latin joke (A Roman walks into a restaurant, holds up two fingers and says, "table for five, please!"), but I refrained ;) Not my dog -- though I've always thought it would be fun to get a lab/golden retriever mix.
@GenExDividendInvestor I just agree with you, if you sell your dividend to take profit, you sell your income. If you have quality companies, growth and dividend raises will boost your wealth over time. Something that a growth investor can never do is catch up with you, as you Dollar Cost Average through your life capturing the highs and lows
Exactly. Look at the share price on ex dividend days. The price drops by the amount of cash the business has to give away. However, I love dividends, it’s all about the monthly income for me , get them reinvested in good businesses and the share price rises too. You need to find businesses with yield under 5% really, anything higher is risky.
Great content! You've really motivated me to push my portfolio to a million. I could already be living off dividends now, earning nearly $8K per month in dividend income.
Thanks :) 8k/mo on a 1 mil portfolio is higher than I'd guess for a conservative portfolio (though you could be going for a more aggressive one or something).. What are your top 3 tickers?
@@GenExDividendInvestor I'm focusing on a strategy that combines high dividend yields with options and other income generating methods. My top three tickers align with my investment goals, balancing stability, growth, and income across different portfolios. In my income-focused portfolio, I hold MSTY, TSLY, and CONY. For my balanced portfolio, I have SCHD, O, JEPI, and JEPQ. In my growth portfolio, my picks are PLTR, DASH, and META.
No, dividends don't increase wealth. The drop of share price on ex-dividend date exactly offsets the cash you'd receive. What increases your wealth is the recovery of the ex-div drop afterward. If share price doesn't recover at least some of that drop, you've lost overall.
Dividends do improve your wealth if you use them to reinvest and buy more shares and then use those to buy more shares; thus, allowing the snowball effect to compound. I believe like yourself that dividends are one of the most passive forms of creating an income stream, over real estate, writing a book, etc. Great content and videos! Always enjoy watching them:)
Dividends only build wealth if the stock or etf price goes up or if it remains the same, if it decrease yoy (stock price) I'm losing even if I'm receiving divs. One of the reasons why I don't buy coverd call etf's,at least right now. Thanks for the video!
I think dividends can increase your wealth if you invest enough or consistently enough over time and withdraw at a rate that lets them continue to grow
Did you see the data about how tickers generally get upward pressure after a split? Perhaps that is part of their motivation? Or maybe something with some backend trading thing, liquidity, lower share price, psychology, etc.
A lower price per share makes the fund more affordable to small retail investors. If you have less than $84 you can’t afford a share, but after the split you can afford to buy a share or two. They are just encouraging more investment in the fund.
@@aaronbarnard9816This is my assumption as the #1 factor and since Schwab, themselves, are one of the few who still trade in full shares, it makes sense they want their own funds as affordable as reasonable.
I love receiving dividends. Keeps investing enjoyable. Always something to look forward to... Money, surprise increases, special distributions. Also, I don't mind paying a little tax now and slowly increasing my cost basis. In a way, makes the future a little more sustainable.
So what's the overall sentiment regarding how to invest moving forward with SCHD?! Can we make a poll to see how many plan on buying more BEFORE or AFTER the split? My guess would be we'll see the price have a nice surge up afterwards, but interested to see what the community's opinion is!
Haha nice! It’s a good video imho :) My upper tier patterns and channel members vote on which thumbnail I use each week- this one was meant to look inquisitive given the question in the title.
The goal of the ETF and their strategy is important so far as how it affects NAV depreciation. If the design doesn't overreach the nav is relatively unaffected. I would reference roundhill funds; their dividends are variable based on how their strategy performed. Any movement of the nav is purely investor sentiment
For me, yes dividends do make a wealth difference. Currently, I have one stock above 100 shares and that stock buys it's own shares now via D.R.I.P., I no longer have to invest personal cash to increase my position. I have another stock that has 20+ shares, the dividends could be broken down to pay for two different stocks plus membership fees but I reinvest back into the parent stock instead. Just two stocks within my portfolio have allowed me to direct my personal income towards other goals if I choose to do so. For me, having the that option available is wealth.
Do stock prices adjust when companies pay rent or utilities or wages or ... Why just for dividends? It's artificial, that's why. The value of a company is based on future prospects (profits) of the business modulo market sentiment. This doesn't change when the company makes a trivial payment to a landlord or a shareholder.
Yes, Dividends increase your wealth. It is the Free Cash Flow available to pay you. However (for me) it only increases your wealth once it has paid for itself, meaning the dividends over time must pay back all of the original cost of the shares and only then is it increasing your wealth. Before then the stock is a cost to buy that portion of the Free Cash Flow of the business you paid for. Everything afterward is an increase in your wealth. That is why you want to own a company with a long track record of 1. paying a dividend but also as important and maybe even more so 2. paying an ever growing dividend every year. This is why i focus on Dividend Aristocrats and Dividend Kings almost exclusively, in addition i buy nothing that pays less than 3% and preferably 4%.
I just bought a royal chicken sandwich combo at Burger King with money from dividends. I buy everything with dividend income - and I reinvest some of my income to buy more shares every month. You bet divies create wealth!
I know in one of your previous videos you said you sped up the playback speed as you had data that stated that many users watched at higher speeds. As a dude that watches most videos at 2X speed, just know I value your content so much, you only get a 1.5 so I can actually understand what you’re saying
remember that simpsons where mr. burns asks at a charity event if anyone has change for a button? can't help but feel that's buffett, except grandpa warren has a better PR manager.
Dividends always increase your wealth in the long term, it may happen at a faster rate if you reinvest them. What do you think will happen to Berkshire Hathaway when Buffet passes?
I mean, some months I don't add any capital or sell any shares, but I end up owning more shares in a couple of things. So does it? I guess it depends on when I'm asked. But it's pretty much a yes at the end of the month.
@@GenExDividendInvestor wonderful video once again! I know not everyone agrees but I love a mixture of both a dividend based portfolio and a growth portfolio. Currently my portfolio allocation is something around 70/30 respectively
Thanks, Walter :) One thing that helps me is to realize that I'm acquiring assets instead of things, and assets tend to appreciate in value (where things tend to depreciate in value). Sometimes I might not be investing in the best asset, but at least I'm on a path that should lead to good things over the long run.
@@GenExDividendInvestor Im doing that. Every time I sell something I put the money on my wife Roth. I’m trying to put more money in my Roth accounts. Unfortunately I’m 63 and my wife 61 so my window is closing fast. I’m still working and I’ll be moving my company 401k to Fidelity soon. I already move my Roth portion to Fidelity. Waiting for the transfer to finish to invest in dividend stocks. Once again , thanks for your help
@@GenExDividendInvestorI switch my answer, but also if we get paid a dividend then it gets reinvested our ownership increased just like you said in the video.
Do dividends increase your wealth. Not directly, because the dividend is subtracted from the share price. But, dividend paying companies give you the best chance for wealth creation because they are, generally, growing earnings and cashflow to pay those dividends.
@@GenExDividendInvestor absolutely when re-invested! You could also argue it does if it pays/covers for bills as this then either frees up other income streams to build wealth or if in a position like yourself, your divvys cover all bills + still left over to re-invest some to continue seeing that compound effect!
Howdy Lucas, thanks. So did you think dividends increase your wealth? Anyway, I'd say dividend growth stocks often show show financial strength, and that can overlap with characteristics of value stocks, which are often undervalued but tend to outperform over time. Of course not all dividend growers are value stocks and some are priced like classic growth. BTW, for some reason your comment showed up in spam (which I don't always check).
@@GenExDividendInvestor on paper, not any more than retained earnings, dividends increase my wealth because my mind is free to be put to work more efficiently on earning more rather than micromanaging my investments! An interesting video topic might be a factor based approach, like Dimensional and Avantis’s philosophies, I use AVUV and DFSV as positions to balance my portfolios large cap exposure, which I don’t think is necessary for everyone, but I’m 23 which is why I use them. Roughly 120k of my brokerage is just SCHD, so heavy large value. Interesting, I actually have videos on my channel and my account is 8 years old, if only TH-cam grabbed more of the real spam comments haha
@@GenExDividendInvestor after watching the whole video, I feel the same. I’ve been a big fan of your channel for a while now. Thanks for sharing all you’ve learned during your investment journey, it’s really helped me. As a 40 year old, I wish I could go back in time and get myself to start investing in 2008.
Yes dividends do increase your wealth. My question is why do people say the stock price goes down when they pay out a dividend. It really shouldnt? From what i understand the stock price is based on what quantity of stocks are bought compared to the total number of stocks the company has in total. The stock price (i believe) does not have any actual direct representation to representation to the company's income or balance sheet.
Yea you said it in this video and I'm not sure if it's true. If the stock price reflected the dividend payout (and I still don't know why it would), it would stand to reason that the stock price would reflect any of leadership's use of large amount of funds. Pay down some debt? Stock price goes down a lot. Buy back shares (stock price would initially plummet when they put the money aside and would slowly rise as they bought back the shares). If this was true that leadership's use of their funds had a direct effect on their share price I think while the dividend payment would have an effect, I think we would see crazy swings whenever they release their quarterly statements in the direction of whether or not they spent more money than they earned. I think I generally see that stock prices lag the financial success of the company by the amount of time it takes for everyone to notice its a very profitable company.
@GenExDividendInvestor as long as you're buy company's that are making money, then drip that money buying more shares at some point your dividend pays your bills giving you freedom (wealth) in my opinion
I don't think dividends increase your wealth because the cash is being paid from a business you own. Its just moving cash from the company's balance sheet to the shareholders. I do however believe dividend stocks are a great way to build wealth due to the nature of the businesses distributing those dividends
Great video GenEx! Thank you. I recently entered a new (small) position in $MSFO, a high yield ETF. I like Microsoft and hoping that there is less volatility in $MSFO compared to other high yield products. Keep up the videos, I really enjoy them to get my Saturday going.
UPDATE: I made a mistake in the video... Now the ex date equals the record date (it isn't a day earlier anymore due to the T+1 faster settlement change that happened a few months ago).
In this video I drill down into the nuances about if dividends increase your wealth, as there’s more to it than you might realize, and I think you’ll find this information really valuable. I’ll also tell you about a well-known dividend ticker that just announced a split.
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Timestamps:
0:00 Intro
0:53 Important Dividend dates to be aware of
2:39 Coca-Cola KO example
4:52 Business revenue/income/divvies
5:12 Stock dividends (as opposed to cash divvies)
5:23 Companies can issue shares to generate capital (distinct, but similar, to stock divs)
6:49 Stock dividend example
8:31 EPS impact from stock dividends
9:51 Stock splits
11:28 Cash dividends
14:10 Reinvesting cash dividends
16:31 Dividends aren’t free money
16:35 My thoughts on divvies
17:17 DCF
17:58 Buffett’s thoughts on divvies & why he likes them
19:43 My thoughts on wealth/divvies
20:29 Examples/articles of people who’ve concluded that divvies increase your wealth/overperform (on average)
21:50 Data showing dividend stocks have outperformed non-div stocks
22:16 Why I prefer quality divvies over treasuries
23:47 Shoutouts & pitches
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I believe the ex date is now the same date as the record date. I think that recently happened this year
@@bluefrog12345 Good catch -- I'll update the description, pinned comment, and add a close caption pop up :)
My goal is to live on dividends as much as possible to avoid spending down the core investment. Capital retention is the same as increasing wealth I think!
Thanks, Robert. I absolutely love living on divvies :)
Ditto with options for me
@GenExDividendInvestor a key I use is enough divs to live comfortably then make sure you have as much as possible in a high growth fund so you can let that 'grow' for 2 years then siphon a portion to your divs to increase your take as cost of living probably won't decrease...
@@jamesfrancis7284 That can definitely work :) I'm happy just to own some quality divs -- I end up getting growth and income (I'll show you my portfolio performance against the sp500 next week in my next vid).
Yes, dividends can increase your wealth. Especially if you are experiencing dividend growth that exceeds inflation. Also while building wealth the cash flow reinvested compounds your wealth accumulation
Thanks for responding!
I started a dividend account three years ago. I aggressively started adding new money. Currently my dividend account is the same as my 401k account. Both increase over time and are about 280,000. Currently dividends pay annually $23,061 and the 401k is just growing. Dividends will pay as long as nothing happens around the world to bad. When I use the 401k money and sell the shares, that's it the money is gone. Dividends will keep paying. SSN average is around $1600 a month, mind will be around $1500 if I wait until I'm 67. My dividends are already paying an average of $1984, which sounds better? My dividends have been increasing every year. Every month it looks sweeter and sweeter. Keep investing and you will have good future.
may I ask what is your current capital that pays you 23 k annually, asking so that we have an idea how much to invest for us who are trying to catch up
Congrats for investing :) I think good divvy stocks in addition to SS is a nice formula over the long run!
I think yes but the more relevant situation to me is what you said in the video "when my income exceeded my family's expenses...".
That's excellent regards of the wealth question and a more practical (and useful) consideration imo.
Fair point :)
As long as the CAGR is higher than inflation and as long as the share price doesn't go down, then yes. Of course, it's also money for nothing (but no chicks for free)
Hehe
I have my brokerage with Schwab. I am UNABLE to do fractional shares of SCHD and I DO have drip turned on, so, those that say you can, are incorrect. I do stock slices (fractional) all the time - with STANDALONE stocks. Can't do it with and ETF. I am very glad to see the stock split for SCHD and SCHG too!
Hopefully they improve their interface and functionality then!
Why are you sticking with them?
@@delbomb3131 because other than that, i do like them. Very good company. When I began looking for a firm a few years ago, they had the best ratings compared to others. Hopefully they will make the change so we can do that into ETFs as well.
@delbomb3131 a fractional share vs whole share may amount to $.37 cents hardly worth changing brokerage for imho
That is really surprising.
I have no problem doing this with ETrade. I think I had it with Vanguard and Fidelity, as well.
The value of dividends is it takes the emotions out of the decision making if you want the income. Outside of that, being invested in great companies is best strategy
That is definitely one of the values :) So where were you with answering the question?
Yes, the dividend puts the wealth in my pocket, away from the hands of the corporate board.
Heh, pocket is always nice ;) Tell me if you have any other thoughts once you finish watching.
Yes, it does. You just have to be consistent in growing your snowball.
Thanks for sharing your input :)
Yes dividends increase your wealth
Thanks for sharing your thoughts, Rod :) After you finish watching tell me if you have any other thoughts on the matter..
Yes, a dividend is a bird in the hand, not in the bush. You get paid while you wait.
I like lots of birds in the hand!
Investing of any kind increases your wealth!
Hehe, what if what you invested in goes down? :)
@@GenExDividendInvestorHaha, a risk that we investors have to take, unfortunately
@@GenExDividendInvestorlike yieldmax? 🤔
@cheeseboi6040 I have a large sum of money in a few Yield Max ETFs, and those payments are used to reinvest a certain % back into the funds and the rest in lower yielding assets. My portfolio value still goes up. Obviously, in down markets, all stocks go down but I just buy more while they're on sale..
@@GenExDividendInvestor DCA sir
Yes, if you reinvest the dividends. If you take the dividends as cash and spend it, then it doesn't help or hurt your wealth.
Nice nuanced response :)
If you use the dividends to pay expenses and not sell your equities, you allow your equities to continue to appreciate which adds to your wealth. Obviously it depends on what the dividend payout is and what does it contribute to the total return of an equity i.e a larger dividend say from a slow growing utility will contribute more to the overall total return than its price appreciation. lots of ways to look at it. Being retired i dont Drip the dividends as i use them to pay for my lifestyle and supplement SS. At some point i want to have more equity exposure (40 to 60 %) as i am only about 33%. i retired 2 years ago and a couple years before that i was like 90% equities so i began converting to a more conservative mix of stocks and bonds but circumstances with inflation and interest rates have stalled that conversion though i am nibbling at Reits the past year. I am just waiting for more of a pullback to more more money to work in equities (dividend payers).
I'd say it still helps your wealth, as you're using the dividend to pay for your expenses instead of having to use other money (eg salary). Either way, you have more spending/saving power
Yes, It allows you to live on them like you do.
Thanks, Kathy. After you finish watching tell me if you have any other thoughts on the matter.
Someone told me Schwab doesn’t allow fractional shares. So probably trying to encourage their investors.
Really? That’s surprising…
False. They do fractional shares if you reinvest automatically
Schwab slice is fractional share
Yeah they have a program for fractionals coming from reinvestment and the limited "slice" program mentioned above, but you can't easily just buy a $$$ amount of a stock with their normal (or advanced) trade ticket. Whole shares only!
@@KristopherHesson I'm surprised they don't implement a simple/flexible way to do that like many other brokerages.
I've found they increase your liquidity and liquidity, in the long term, *is* wealth, as you are not forced to withdraw in order to ''cash out''.
If you regularly take them out like they are simply your disposable income, that's a recipe for disaster or, at the very least, stagnation. Dividends are absolutely *not* ''passive income'' as they are not really passive, nor are they ''income'' until you make them into it. I run my portfolio like a business in which dividends are basically operating cashflow.
Interesting take, thanks for sharing.
Great video!! I invest in Dividend paying companies so I don’t have to work two jobs forever and hopefully can only work part time in the near future!
Thanks, I'm glad you enjoyed it :)
yes
Thanks for answering :) Tell me if you have any other thoughts once you finish watching.
Yes of course
Thanks for answering :) Tell me what you think after you watch the video...
Yes!!
Thanks for sharing -- and double exclamation mark no less!!
Yes
Thanks for answering :) Tell me if your answer changes any after you finish watching...
You know i never actually knew for certain what the "ex dividend date" meant up until now, thanks a billion for the explanation.
Is that your Labrador dog on the thumbnail ???, that's my favorite breed.
You're welcome :) I almost was going to crack a latin joke (A Roman walks into a restaurant, holds up two fingers and says, "table for five, please!"), but I refrained ;) Not my dog -- though I've always thought it would be fun to get a lab/golden retriever mix.
Yes
Thanks for answering! Tell me if you have any other thoughts once you finish watching...
@GenExDividendInvestor I just agree with you, if you sell your dividend to take profit, you sell your income.
If you have quality companies, growth and dividend raises will boost your wealth over time.
Something that a growth investor can never do is catch up with you, as you Dollar Cost Average through your life capturing the highs and lows
The dividend itself does not increase wealth. The stock or etf share price is adjusted lower by the exact same amount of the dividend being paid.
Exactly. Look at the share price on ex dividend days. The price drops by the amount of cash the business has to give away. However, I love dividends, it’s all about the monthly income for me , get them reinvested in good businesses and the share price rises too. You need to find businesses with yield under 5% really, anything higher is risky.
Thanks for sharing :)
Great content! You've really motivated me to push my portfolio to a million. I could already be living off dividends now, earning nearly $8K per month in dividend income.
Thanks :) 8k/mo on a 1 mil portfolio is higher than I'd guess for a conservative portfolio (though you could be going for a more aggressive one or something).. What are your top 3 tickers?
@@GenExDividendInvestor I'm focusing on a strategy that combines high dividend yields with options and other income generating methods. My top three tickers align with my investment goals, balancing stability, growth, and income across different portfolios. In my income-focused portfolio, I hold MSTY, TSLY, and CONY. For my balanced portfolio, I have SCHD, O, JEPI, and JEPQ. In my growth portfolio, my picks are PLTR, DASH, and META.
No, dividends don't increase wealth. The drop of share price on ex-dividend date exactly offsets the cash you'd receive. What increases your wealth is the recovery of the ex-div drop afterward. If share price doesn't recover at least some of that drop, you've lost overall.
Thx for your input… Keep watching :)
@HedgeFundOfOne that's called nav erision...plenty of stocks pay divs w/o nav erosion...
What's your view on XDTE?
yes absolutely....I am only 9 months into dividend investing and am beating my soon to
be "ex" broker by far....
Thanks for responding -- whatcha mean you are beating him?
@@GenExDividendInvestor By beating I refer to better returns and no 1.3% fee.'
As many have stated, no one cares about your $ more than you do..
I think they do
Thanks for your input, Pablo :) Tell me if you have any other thoughts once you finish watching.
Dividends do improve your wealth if you use them to reinvest and buy more shares and then use those to buy more shares; thus, allowing the snowball effect to compound. I believe like yourself that dividends are one of the most passive forms of creating an income stream, over real estate, writing a book, etc. Great content and videos! Always enjoy watching them:)
Thanks, it’s been interesting reading different perspectives :)
Dividends only build wealth if the stock or etf price goes up or if it remains the same, if it decrease yoy (stock price) I'm losing even if I'm receiving divs. One of the reasons why I don't buy coverd call etf's,at least right now. Thanks for the video!
Thanks for your response, Earl :) What if the stock price keeps going sideways, but you are still getting dividends?
Sideways is the best, in my opinion, with drip on means more ownership plus if quality companies grow divs it can grow wealth.
I think dividends can increase your wealth if you invest enough or consistently enough over time and withdraw at a rate that lets them continue to grow
Thanks for sharing your thoughts -- tell me what you think after you watch the vid :)
I'm still confused on SCHD doing a split. Why would an ETF do that? I thought that was a single stock thing
Did you see the data about how tickers generally get upward pressure after a split? Perhaps that is part of their motivation? Or maybe something with some backend trading thing, liquidity, lower share price, psychology, etc.
A lower price per share makes the fund more affordable to small retail investors. If you have less than $84 you can’t afford a share, but after the split you can afford to buy a share or two. They are just encouraging more investment in the fund.
@@brerpossum I guess not all platforms do fractional shares...for some reason
@@aaronbarnard9816 I know E*trade doesn’t.
@@aaronbarnard9816This is my assumption as the #1 factor and since Schwab, themselves, are one of the few who still trade in full shares, it makes sense they want their own funds as affordable as reasonable.
Yes, dividends increase my health.
Hehe, nice.
Yes. They do. Only when your investments reach the point to pay all your monthy bills. From that point forward it's all wealth....
@@killersentra heh, thanks for sharing :)
Great job on your video 😊
Thanks, Paul :)
I love receiving dividends. Keeps investing enjoyable. Always something to look forward to... Money, surprise increases, special distributions. Also, I don't mind paying a little tax now and slowly increasing my cost basis. In a way, makes the future a little more sustainable.
Ya I think the motivational aspect is not appreciated by some. And cool silver star :)
So what's the overall sentiment regarding how to invest moving forward with SCHD?! Can we make a poll to see how many plan on buying more BEFORE or AFTER the split? My guess would be we'll see the price have a nice surge up afterwards, but interested to see what the community's opinion is!
I plan to buy before and after :)
I just clicked because of the picture of the dog. Good marketing.
Haha nice! It’s a good video imho :) My upper tier patterns and channel members vote on which thumbnail I use each week- this one was meant to look inquisitive given the question in the title.
A sinking company that doesn't pay dividends doesn't work out either...
Heh, prolly not!
The goal of the ETF and their strategy is important so far as how it affects NAV depreciation. If the design doesn't overreach the nav is relatively unaffected. I would reference roundhill funds; their dividends are variable based on how their strategy performed. Any movement of the nav is purely investor sentiment
Howdy, did you mean to respond to me instead of someone else? :)
Context matters and it matters a lot.
As much as I like this video, I love the links you shared. Thanks a bunch!
@@mikesurel5040 You’re welcome :)
For me, yes dividends do make a wealth difference.
Currently, I have one stock above 100 shares and that stock buys it's own shares now via D.R.I.P., I no longer have to invest personal cash to increase my position.
I have another stock that has 20+ shares, the dividends could be broken down to pay for two different stocks plus membership fees but I reinvest back into the parent stock instead.
Just two stocks within my portfolio have allowed me to direct my personal income towards other goals if I choose to do so. For me, having the that option available is wealth.
Thanks for sharing :)
Depends on what you do with the divs, but it definitely makes you feel better about yourself. Guilty 😂
That's worth something at least ;)
Do stock prices adjust when companies pay rent or utilities or wages or ... Why just for dividends? It's artificial, that's why. The value of a company is based on future prospects (profits) of the business modulo market sentiment. This doesn't change when the company makes a trivial payment to a landlord or a shareholder.
Yes indeed :) I started to explain that in the DCF section but the video was too long already…
Yes, Dividends increase your wealth. It is the Free Cash Flow available to pay you. However (for me) it only increases your wealth once it has paid for itself, meaning the dividends over time must pay back all of the original cost of the shares and only then is it increasing your wealth. Before then the stock is a cost to buy that portion of the Free Cash Flow of the business you paid for. Everything afterward is an increase in your wealth. That is why you want to own a company with a long track record of 1. paying a dividend but also as important and maybe even more so 2. paying an ever growing dividend every year. This is why i focus on Dividend Aristocrats and Dividend Kings almost exclusively, in addition i buy nothing that pays less than 3% and preferably 4%.
Interesting perspective, thanks for sharing.
I just bought a royal chicken sandwich combo at Burger King with money from dividends. I buy everything with dividend income - and I reinvest some of my income to buy more shares every month. You bet divies create wealth!
hehe, gotta love it? :)
I know in one of your previous videos you said you sped up the playback speed as you had data that stated that many users watched at higher speeds. As a dude that watches most videos at 2X speed, just know I value your content so much, you only get a 1.5 so I can actually understand what you’re saying
Haha nice!
Yes of course dividends increase your wealth they represent earnings paid out of a company that your own👍
Thanks for your feedback, Jonathan :) Tell me if you have any other thoughts after watching the video.
remember that simpsons where mr. burns asks at a charity event if anyone has change for a button? can't help but feel that's buffett, except grandpa warren has a better PR manager.
Change for a button?
Yes, it does!
Thanks for your feedback :) Tell me if you have any other thoughts once you finish watching...
Definitely YES.
Thanks for sharing your feedback -- tell me if you have any other thoughts once you finish watching :)
H_ll yea it does. I get untaxed nearly 6 figures of dividends added and reinvested into my account every year.
Nice job, what are your top 3 positions?
Yes! They can increase your wealth, while giving you that necessary income to live on.
Thanks for responding, and enjoy the weekend :)
Yes it does
Thanks for sharing, Allen :)
Dividends always increase your wealth in the long term, it may happen at a faster rate if you reinvest them.
What do you think will happen to Berkshire Hathaway when Buffet passes?
Thanks for answering :) I think the current crop of managers will continue on...
Yes!
Thanks for answering, Chris :) Tell me if you have any other thoughts once you finish watching the video.
I mean, some months I don't add any capital or sell any shares, but I end up owning more shares in a couple of things. So does it? I guess it depends on when I'm asked. But it's pretty much a yes at the end of the month.
Thanks for sharing your thoughts :)
Absolutely
Thanks, James :) Tell me if you have any other thoughts once you finish watching.
Yes I believe so!
Thanks, Elias. Tell me if you have any other thoughts once you finish watching :)
@@GenExDividendInvestor wonderful video once again! I know not everyone agrees but I love a mixture of both a dividend based portfolio and a growth portfolio. Currently my portfolio allocation is something around 70/30 respectively
Yes
Thanks for sharing, Marques :)
Yes
Thanks for responding, Joe :)
Yes!
@@marcovandelaar8863 Thanks for answering :)
Yes 😉
Thanks for answering! Tell me if you have any other thoughts once you finish watching.
Yes absolutely. Especially the newer ones. Like with options
If the company is solid, then the answer is a definite yes !
Thanks for your response :)
Another great video, thanks. Every time I get a little discouraged to continue dividend investing your videos cheer me up. Thanks.
Thanks, Walter :) One thing that helps me is to realize that I'm acquiring assets instead of things, and assets tend to appreciate in value (where things tend to depreciate in value). Sometimes I might not be investing in the best asset, but at least I'm on a path that should lead to good things over the long run.
@@GenExDividendInvestor Im doing that. Every time I sell something I put the money on my wife Roth. I’m trying to put more money in my Roth accounts. Unfortunately I’m 63 and my wife 61 so my window is closing fast. I’m still working and I’ll be moving my company 401k to Fidelity soon. I already move my Roth portion to Fidelity. Waiting for the transfer to finish to invest in dividend stocks. Once again , thanks for your help
Yes dividends would increase your wealth
Thanks for sharing, Allen :)
You did mention the schd split. Awesome 👌🏾
:)
Yes.
Nice, you're the first to actually comment yes/no :)
Dividends have increased my wealth.
Hehe, nice :)
Yes absolutely they have for me..
Nice! Tell me if you have any more thoughts after watching :)
I think it does because your assets are paying out more to you
Thanks for your input -- after watching the whole video, do you have any other thoughts?
@@GenExDividendInvestorI switch my answer, but also if we get paid a dividend then it gets reinvested our ownership increased just like you said in the video.
Do dividends increase your wealth. Not directly, because the dividend is subtracted from the share price. But, dividend paying companies give you the best chance for wealth creation because they are, generally, growing earnings and cashflow to pay those dividends.
Thanks for answering, Jason :)
Yes it does help. Create wealth
Thanks for your response!
yes
Thanks for sharing, Denise :) Tell me if you feel any different once you watch the whole video.
Interesting topic and one that only motivates me to continue building my dividend kingdom!
Thanks :) So, what was your answer?
@@GenExDividendInvestor absolutely when re-invested! You could also argue it does if it pays/covers for bills as this then either frees up other income streams to build wealth or if in a position like yourself, your divvys cover all bills + still left over to re-invest some to continue seeing that compound effect!
Can you do a video about schd.
I was thinking about it :)
Yes my goal is to retire on them
@@Mike.GoldenTouch28 Nice, I hope you accomplish your goal :)
Yes with DRIPS.
Nice :)
Curious your thoughts on the correlation of outperformance of dividend growth stocks with their participation in the value premium, love the vids🎉
Howdy Lucas, thanks. So did you think dividends increase your wealth? Anyway, I'd say dividend growth stocks often show show financial strength, and that can overlap with characteristics of value stocks, which are often undervalued but tend to outperform over time. Of course not all dividend growers are value stocks and some are priced like classic growth. BTW, for some reason your comment showed up in spam (which I don't always check).
@@GenExDividendInvestor on paper, not any more than retained earnings, dividends increase my wealth because my mind is free to be put to work more efficiently on earning more rather than micromanaging my investments! An interesting video topic might be a factor based approach, like Dimensional and Avantis’s philosophies, I use AVUV and DFSV as positions to balance my portfolios large cap exposure, which I don’t think is necessary for everyone, but I’m 23 which is why I use them. Roughly 120k of my brokerage is just SCHD, so heavy large value. Interesting, I actually have videos on my channel and my account is 8 years old, if only TH-cam grabbed more of the real spam comments haha
@@lucasdurham6830 Hmm, I didn't see any videos about investing on it?
Without hearing the video my comment is, if you manage to live of dividends you already wealthy
Hah, good point :)
I drip, so ye s it does!!
Heh
Absolutely!!!
Thanks for responding, Donovan :)
Great video
Glad you enjoyed it :)
speak for yourself. my broker doesnt allow fractioanl shares
Which one?
Schd getting ready for a three to one split
I guess I should have waited to finish the video before I commented 😂
Haha
Yes, yes, yes
Hehe
Yes, dividends can increase wealth 😎🤘
Thx, tell me if you feel any different after watching the whole video :)
@@GenExDividendInvestor after watching the whole video, I feel the same. I’ve been a big fan of your channel for a while now. Thanks for sharing all you’ve learned during your investment journey, it’s really helped me. As a 40 year old, I wish I could go back in time and get myself to start investing in 2008.
Yes
Thank you for your response :)
Yes
Thx for sharing, Grant. Tell me if u have any other thoughts after you finish watching.
Yes
Thanks for sharing.. tell me if you feel any different after watching the video :)
Yes dividends do increase your wealth. My question is why do people say the stock price goes down when they pay out a dividend. It really shouldnt? From what i understand the stock price is based on what quantity of stocks are bought compared to the total number of stocks the company has in total. The stock price (i believe) does not have any actual direct representation to representation to the company's income or balance sheet.
Yea you said it in this video and I'm not sure if it's true. If the stock price reflected the dividend payout (and I still don't know why it would), it would stand to reason that the stock price would reflect any of leadership's use of large amount of funds. Pay down some debt? Stock price goes down a lot. Buy back shares (stock price would initially plummet when they put the money aside and would slowly rise as they bought back the shares). If this was true that leadership's use of their funds had a direct effect on their share price I think while the dividend payment would have an effect, I think we would see crazy swings whenever they release their quarterly statements in the direction of whether or not they spent more money than they earned. I think I generally see that stock prices lag the financial success of the company by the amount of time it takes for everyone to notice its a very profitable company.
Thanks for sharing -- keep watching and I try to explain what happens in detail :)
Yes eventually at first not really
Thanks, whatcha mean?
@GenExDividendInvestor as long as you're buy company's that are making money, then drip that money buying more shares at some point your dividend pays your bills giving you freedom (wealth) in my opinion
I don't think dividends increase your wealth because the cash is being paid from a business you own. Its just moving cash from the company's balance sheet to the shareholders. I do however believe dividend stocks are a great way to build wealth due to the nature of the businesses distributing those dividends
I said “yes”, but this is an interesting take .
Thank you for the nuanced answer, Allen :)
Great video GenEx! Thank you. I recently entered a new (small) position in $MSFO, a high yield ETF. I like Microsoft and hoping that there is less volatility in $MSFO compared to other high yield products. Keep up the videos, I really enjoy them to get my Saturday going.
Thanks and you're welcome :)
Yes
Thanks for responding :) Tell me if your thoughts change after watching the vid.
@@GenExDividendInvestor Still yes 😁
Yes, dividends increase your wealth. It can be your ultimate passive cash flow income.
Thanks for answering, Belle :) Tell me if you have any other thoughts once you finish watching...
❤
So are you a yes or a no or…?
@@GenExDividendInvestor yes of course! I to am living off my dividends… of course I am a mite older than you are…..70 yrs young..
Yes, dividends increase my wealth
Thanks, Julie :)