The Problem With Dividend Stocks 🤯
ฝัง
- เผยแพร่เมื่อ 20 ก.ย. 2024
- Start investing with bonuses below ⤵️
► Pick up a FREE stock: bit.ly/DanielRH
► Get some FREE Crypto: bit.ly/BlockFi...
► Required Reading For Future Millionaires: bit.ly/Cookthe...
----------
----------
None of this is meant to be construed as investment advice, it's for entertainment purposes only. Links above include affiliate commission or referrals. I'm part of an affiliate network and I receive compensation from partnering websites. The video is accurate as of the posting date but may not be accurate in the future.
![[LIVE] : ONE ลุมพินี 80 | คู่เอก "รักษ์ vs ยอดนำชัย"](http://i.ytimg.com/vi/ckLMRorsMeY/mqdefault.jpg)
The thing to me is, if you invest and have other income outside of dividends then you will be able to live off dividends without selling. Which means you can pass that on to your kids which will give them a leg up in life. $52k dividends received in 2022.
I agree! That's why it is advisable that you have to invest while you still have a regular job or earning a regular income, and do it constantly. You still need to have something that will keep you going even if you're investing. Good financial planning and money allocation is the key.
I had my share of ups and downs when I first started looking for a consistent passive income so I hired an expert advisor for aid, and following her advice, I poured some money in value stocks and digital asset, i accrued over $80K in dividends last year
I’ve been down a ton, I’m only holding on so I can recoup, I really need help, who is this investment-adviser that guides you?
Her name is “Sonya Lee Mitchell” can't divulge much. Most likely, the internet should have her basic info, you can research if you like
I just checked her out and I have sent her an email. I hope she gets back to me soon.
I’m pretty young and just started my portfolio with around $80K. Dividends drew me in right away! Slowly trying to create significant passive income and manage my Stock Portfolio. how do I invest to deal with markets ups & downs
It's wise to seek expert assistance when beginning your financial portfolio. market is volatile, so professional guidance is so important..
Having an investment advisor is the best approach to the stock market right now. I was going solo without much success until my wife introduced me to an advisor. I've achieved over 80% capital growth this year, excluding dividends.
Hey friend, How can I work with your Fiduciary?
*Marissa Lynn Babula* is the licensed fiduciary I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment..
I just googled her and I'm really impressed with her credentials; I reached out to her since I need all the assistance I can get. I just scheduled a caII.
Dividend are taxed at the lowest tax bracket . Like 15% . I used the passive income from my dividend stocks to buy growth stocks. It's good to have both .
Exactly why have 1 when you can have both
People also tend to forget that many stocks are actually Dividend Growth Stocks. For example - Johnson and Johnson (JNJ). Their stock value AND dividends rise over time, so you get the best of both worlds. Plus, a consistent record of dividends over multiple decades is a good way to determine the true quality of a company. JNJ has paid out over 50 years of consistent, rising dividends, quarter after quarter, through world wars, recessions, company hardships, political changes, etc etc.
This short is just click bait schlock If you are going to manage your own money for the love of God read some financial white papers.
But you could just sell the % of the growth stocks you own in the amount of the dividend % you receive it’s the same thing. Taxed at lowest tax bracket too
Yes I have both,dividend etf's and dividend stocks but also many positions without dividend.
In the app I'm using there is a daily lists of 'movers' so I also buy stocks that went up rapidly.
For example I bought 3 stocks of Kala Farmaceutic for Total 24,90 eur.
Next day they went up around 350%. Total value was now 110 euro.
I sold 2 for 74 euro and kept one.
I made 85 eur profit in one day (if only I would have bought 10 stocks or more...if if if lol)
These are small lucky moves but it's fun to see a quick return.
I've heard that index funds and ETFs provide diversified stock market exposure while spreading risk. I have over $100K in savings; What's the most effective strategy to allocate funds in my portfolio and generate profits?
Yes, there are strategies that could be put in place for solid gains regardless of economy situation, but such execution is usually carried out by an investment specialist
Having an investment advisor is the best way to go about the stock market right now. I was going solo, but it wasn't working. I’ve been in touch with an advisor for a while now, and just last year, I made over 80% capital growth minus dividends.
This is definitely considerable! think you could suggest any professional/advisors I can connect with? I'm in dire need of proper portfolio allocation
*Jennifer Leigh Hickman* is the licensed advisor I use. Just search the name. You’d find necessary details to work with to set up an appointment.
Thank you for the lead. I searched her up, and I have sent her an email. I hope she gets back to me soon.
I have been a dividend focused investor for a long time. This does not mean I don't own growth stocks, I do. A well rounded portfolio should be a mixture of both categories. One way to minimize the anxiety out of stock market investing, is to make sure you keep a large cash cushion. I invest in the market, but never put all my money in market.
Dividends are dope. Personally, I sometimes use my dividends to buy other dividend and growth stocks for diversification instead of reinvesting in the same stock. To each their own methods though. The good thing is that you’re investing in the first place and that’s what’s important.
In my opinion, it was much easier investing back in the 60s but it’s a lot trickier now, those making consistent profit in these times are professionals reason I’ve been using an advisor for the past 5 years to consistently build my portfolio in preparations for retirement.
Could you kindly elaborate on the advisor's background and qualifications?
The advisor that guides me is Sonya lee Mitchell, most likely the internet is where to find her basic info, just search her name. She's established.
I just googled her and I'm really impressed with her credentials; I reached out to her since I need all the assistance I can get. I just scheduled a caII.
It is a solid debate that's been around for years, but your oversimplification of dividend stocks does an injustice. Dividend stocks can also be used as a passive investing strategy that doesn't come with the massive volatility of the growth markets, I've got some of both and I personally think it's a personal decision people should be making because everyone has their own risk/reward threshold
He literally said in the video….
Anyone who has read at least half a dozen books on capital allocation and finance could poke a hundred holes in this ideology.
It makes perfect quantifiable sense from an academic perspective, however in practical application is largely nonsense. It’s a theory perpetuated by a response from buffet at a Berkshire conference that was taken WAY out of context.
Please make a 1 minute short that is able to do better. These aren't intended for you to just do exactly what he tells you to. They get you thinking. Should you invest in growth or dividend stocks? Which ones? The goal from his point is to get you to do research, not spoon feed success to you.
@@theskilledsnake I’m more curious as to your thoughts on this after your research. What have you decided is best for you and why?
Dividend growth stocks are insane. Just look at the amount of growth on home depot.
Dividend you receive stays within your ROTH IRA so no need to be taxed.
That's if you're using a Roth IRA vs playing the market
Only counts if you bought in your roth. Not applicable in a regular brokerage account. Also VOO pays a divided....
@ roth IRAs are non taxable. You would only be taxed in the dividends if you withdrew them prior to age 59.
@ On a 401k you will pay the taxes once you start withdrawing so it's deferred taxes....
@ it's tax deferred, not tax free.
The truth is if you invest and have other income outside of dividends then you will be able to live off dividends without selling. Which means you can pass that on to your kids which will give them a leg up in life
Dividends are dope. Personally, I sometimes use my dividends to buy other bonds and growth stocks for diversification instead of reinvesting in the same stock. To each their own methods though. The good thing is that you’re investing in the first place and that’s what’s important. Salute for the content!
The current market might give opportunities to maximize profit within a short term, but in order to execute such strategy , you must be a skilled practitioner or know one
I’ve actually been looking into consultant lately, the news I’ve been seeing in the market hasn’t been so encouraging and I could really use some guide, but are they really that effective though?
The decision on when to pick an Adviser is a very personal one. I take guidance from Sharon Ann Meny to meet my growth goals and avoid mistakes, she's well-qualified and her page can be easily found on the net.
Dividend stocks are not for retirees. That’s a myth. Dividend stocks are for young investors that want to be retirees at 40
35 if we’re lucky
Lol
😂😂😂😂😂 buying playstation 5s and overpriced homes and student loan debt will ensure Gen z will be working at least until 70
@@o.c.g.m9426 a PS5 is a waste of time cause videogames don’t pay you, owning a home nowadays is just for heritage (not really necessary) and graduating and having a huge debt should be seeing as an investment for getting a bigger income instead of working as a cashier on a retail store for 1/3 of the salary of a doctor (so its really worth it) of course it’s just my opinion
Dividend Stocks are the bomb. I've made a ridiculous amount - and getting that monthly paycheck in a way that is NOT a tax event, since you don't pay taxes until you reach a high wage - is awesome. From a fellow creator and investor... ;)
Which dividend stocks are you making said ridiculous amount from?
Also interested in some high dividend stocks
@@superbray1 Preach. I'll make video on it then. ;)
@@thedividenddream yes please make the video
The idea that you don’t pay taxes until you get a high wage is probably wrong…depending on what you mean by “high”.
The tax from dividends is hardly noticable especially if your buying qualified dividends
you're
Yeah it’s 0% until 44k.
In a bull market, yes..growth stocks are better, but when you combine bull and bear markets, dividend stocks actually slightly outpace them. Dividend companies generally indicate good long term success. Especially if they are able to continue growing their dividend year after year. In a market correction as we are in today, dividends are a great way to continue advancing your portfolio growth as you are able to reinvest that steady income.
...but reinvest in what? Back into the company that is now less valuable since it just kicked out a bunch of cash assets that you owe taxes on? ...Or invest it somewhere else?
I mean no, if you reinvest the dividends you can get more dividends so really this is stupid. It's not like there won't be taxes in the future
I know this is a short video, but there are a couple of important things to consider:
1. Taxes don't matter in a Roth IRA. I typically put my high yield assets in my Roth.
2. Growth investing may not work out the same way this upcoming decade as it has in the last decade. If the economy slows down (and it has), dividend investing will likely outperform growth stocks (and we have seen this begin to take shape in recent years). Regardless, trying to guess what the economy will do in ten years is a bit of a crap shoot. I say invest in whatever does the best in keeping you focused on your financial well being.
Dividends are dope. Personally, I sometimes use my dividends to buy other dividend and growth stocks for diversification instead of reinvesting in the same stock. To each their own methods though. The good thing is that you’re investing in the first place and that’s what’s important. Salute for the content! 👍🏽
@Leanne Wesk you really don't like dividend stocks do you lol. You're all over these comments
Mullen Advanced Energy Operations Provides Update on EMM Installation for D.C. City Government.
I use my dividend payments to buy other stocks that offer dividends so I'm diversified and don't lose my position just in case it grows a good amount
@ how 🤔 plz explain your logic behind your opinion
@ i started with the vanguard total stock and grew from there i have multiple etf stocks but only the ones that pay dividends after a while with those i added multiple dividend kings and aristocratics havnt sold anything yet just keep adding
@Leanne Wesk what if your in a 0% tax bracket?
@Leanne Wesk Let's take this premise. Let's say you have 100 USD a Month you can Invest in. With Growth Stocks, that means you're locked in at only 100 USD a Month, 1200 USD a Year.
With Dividend Stocks, you Reinvest the Dividends. So Month 1, you get 1 USD. Not much. But now you have 101 USD Buying Power. Every Month your Buying Power INCREASES with Dividend Stocks. So I still only have 100 USD available from my work or my disability payment... but now I have MORE than that to Invest, since the Dividends add to it.
Right now, I'm hitting 170 USD a Month in Dividends. So I went from putting in 500 USD a Month, to 670 USD a Month. If you go from 100 to 120 a Month, that's a nice 20% Increase in Purchasing Power without a raise at work, or without cutting back to be able to invest more out of pocket.
@Leanne Wesk you’re wrong
I will point out one major aspect that is always left out of these discussions. Eventually you need to sell stuff.
When you need to sell to get X number of dollars it would be nice to have diverse set of assets to pick from when selling. Otherwise you are just stuck selling the one thing you got. Please think about that. No one can tell you that in March of 2065 it will be a good time to sell sp500 index or if it would make more sense to sell qqq. But if you own a bit of both when you get to 2065 you will have a choice. Im not going to say buy this or that, but please consider having enough diversity in your portfolio to have meaningful choices when the time comes to sell. That might mean having some individual stocks in addition to an sp500 index. It might mean having a few sector focused etfs. Figure out what will work for you, but please think about this.
Not to mention that dividend reinvesting means you own more stocks. Growth is great, but you don’t own more of the company. With dividend investing and a long term approach, you will get a snowball effect. Reinvesting dividends gets a bad wrap but in the UK with a stocks and shares ISA you don’t pay tax so it’s actually a great way to grow your portfolio organically.
Dividends reinvested in your Roth IRA is the best scenario for these types of stocks,especially if you bought SPG at 60 dollars a share, like me. So we picked up the growth and they never stopped paying a dividend through the pandemic
This video implies dividend growth has no place, but only "income" funds or growth. Having a yield on cost higher than the average return of the S&P cannot be ignored.
Yeaaaah, all these growth stocks are doing soooo well this days 🤣
I think it's more of a long term play 🤷♀️
It'll eventually grow. That's why you buy now when it's low
@@katoria69 I'm 19 and new to investing In stocks. So basically it's better to invest in growth stocks instead of dividends?
@@ericthomas9192 do you like coke or Pepsi? Depends on the individuals taste buds. Dividend aristocrats are better during market downturns (like 2022 right now). Growth are better upside in bull markets. I use dividends like others use bonds. Whatever your age, you can put that in dividend stocks then the rest for growth. But at 18, growth is good. I did that up until this year. I’ve lost over half a million on paper as a result. But I was up to 2 million because of how crazy growth stocks were. So it’s really a matter of age and preference. Higher risk high reward, or slow and steady nearly guaranteed millions by retirement. Or just split the difference and buy apple and Microsoft as growth dividends 🤷♂️🤷♂️
@@markislivingdeliberately so dividend stocks are better than growth stocks ? If so what stocks should I invest in that pays me monthly dividends?
Additionally dividend stocks do payout regularly allowing for you to buy more of the stock. So while it is true a 8% dividend yield may lose to say 10% growth stock you get paid out 2% in Q1 buying more stock so that in Q2 you would get a 2.x% payout (to lazy to do the actual math) so depending on the tax bracket you can in some cases come out ahead even in the long run with dividend stocks especially if you can reinvest as pre-tax assuming you aren't already maximg that out.
Dividend stocks accelerate compound interest when reinvested.
So ignorant lmao
Mullen Advanced Energy Operations Provides Update on EMM Installation for D.C. City Government.
Up to 40k is untaxed. For most people that’s way more then they will make with dividend payments
That's only true if you aren't making any other income and the same thing is true of capital gains...
A growth stock is the same as a value stock. When you buy shares of a company you are estimating its intrinsic value is higher than the price you are paying for it. Hence growth is just part of the value propisition.
Thanks!
The trick is to invest in opportunity. I hold both kinds of stocks bc I see potential of stocks that can do very well in the future. I do like dividend stocks for that cash it puts in my pocket to reinvest into other things, or use it to live off of if I need to.
The best part about a fat dividend check every month is retiring very, very early. Some things are worth more than having a little extra money when you're old
You didn’t mention DRIPing the dividend. Reinvesting the dividend can have huge compounding effects over long term
Albert Einstein famously referred to compounding interest as
Yes he did, but he said you’d be taxed on those dividends. Unless you’re doing it in a Roth which he should’ve mentioned
Okay but you dont pay tax on dividends until your short term capital gains income reaches 40k in a year. @@advikdeshmukh805
Most "guru's" are just reciting information. You could make a salaries worth in dividends, before owing taxes so yes you can still compound them
@@advikdeshmukh805
I have ISA account in UK and I don't need to pay any taxes
Real pro tip: Buy both
U didn’t say follow for more… is this the end? Should I go?
😂
Given that my dividend portfolio is currently beating the major indexes and VOO, I’ll continue with reinvesting my dividends 😏
Are you still beating VOO?
@@Michael-DS Losing by 3% annualized with SCHD + other dividend stocks from the time I started this account. Still confident my combination will prove to be effective come my retirement in 30+ years 😀
@@Yeah_Buddy_LIGHTWEIGHT thanks for the update.
@@Yeah_Buddy_LIGHTWEIGHTcheck out JEPQ
@@Yeah_Buddy_LIGHTWEIGHTi have just started to inves on dividend stocks. Could you give me some tips? Thank you.
Dividend stocks are great in retirement accounts. Dividend reinvest preretirement and then dividend income when retired. Dividend stocks are terrible for nonretirement accounts, because they are taxed. The problem is the stock price drops the exact amount paid out on the divide, which you are taxed on. Taxed on losing equity is a losing man's game.
You understand neither how capital gains are taxed, nor how stock prices factor into choosing dividend stocks. Dividend investors don't care if a stock price goes down temporarily after a payout, equity means nothing for a stock you don't intend to sell. Guess what? The stock still follows common sense market behavior and grows over time anyway
@@evocati6523 Temporarily, is the key word. The majority of high dividend paying stocks and ETFs consistently lose NAV. I understand much more than you think. See you in the poor house.
As someone with a tfsa in canada. Meaning all money generated from this account is tax free and can be withdrawn anytime. This just makes sense because il have constant cashflow in my later year that wont be taxed at all.
You don’t get taxed until like $40,000 a year then from 41,000 to like 400,000 or 500,000 you get taxed 15%
VOO also pays a dividend
Thanks for mentioning the taxes many don't and dont have enough of a loss or income to get the benefits of not paying taxes that year.
Growth stocks are good long term to eventually sell or trade off. Dividend stocks are good long term if your looking for that passive income and want to retire bd live off of it, but still grow your portfolio or even reduce you work life to a part time job.
paying tax is important too because a government needs money to keep you and yout investments safe. And society needs maintenance. Paying dividend tax is good in other ways.
Open a TFSA and your fine……
I do both currently. 250$ a mouth each into dividend stocks and other 250$ into growth mutual fund for retirement.
If you have 500 extra every month you're already doing well
Dividend stocks tend to be more established companies too. They're q good alternative for investors who get cold feet and want to pull their money when the market retracts.
You can't just stay in growth stocks forever. You need to cycle between. In my case I'll be selling enphase at the end of the year or middle of when it hits 280. When it does, I'll take my initial investment out and the compound dividends into "O". 2.958% couple extra grand a month. And on a significant downturn I will only be out of 2-5% whereas my favorite companies will have a 20% buying opportunity atleast. Rinse and repeat
Don’t pay capital gains tax on that ISA OR IRA THOUGH , so dividends are great until you cap that out
I have majority of Dividend stocks, with also a majority of the dividends in my Roth IRA.
Dividends paid into Retirement accounts; 401K, IRA, Roth IRA, etc; are TAX FREE EVENTS.
What about TD Ameritrade's DRIP plan. (dividend reinvestment plan). It automatically reinvests so is there still a tax event if it's automatic?
Yes
This is correct. However, I could poke a hundred holes in the wisdom of this clip. It’s derived from Buffet responding to a question at a Berkshire conference and taken far out of context. To the point of absurdity.
Yep still taxable even if you automatically reinvest.
@@neutralsportsfan17 so after taking out the money you pay tax again? So almost tax 2x
@@giovannip8600 No. You are already taxed on the Dividends, so you can take the Dividends out without being taxed double. If you SELL the Shares, the PROFIT will also be Taxed.
So if your Tax person knows what they are doing, they subtract the Dividends from the Profits... since you already paid on the Dividends, and the remaining Profit is what you would be Taxed on.
Have to be careful. IRS hit my buddy up after our 1st Tour in Iraq. Said he owed on 28K PROFIT when he liquidate his account. Dude made 6K Profit, and they tried to Tax him as if the ENTIRE 28K was somehow Profit. He ended up being Audited. It took time, but he got cleared and only had to pay Taxes on the 6K. Problem is, now he catches an Audit every 2-3 Years.
Dividend stocks are great in traditional IRAs, Roth IRAs, and other tax advantaged accounts. Growth is good, but why not both? Dividend stocks are a great hedge against downturns in the market. They keep paying you money even when your 'growth' stocks are going down or flat.
Dividends are great for retirement. If you can build up enough money, you can live off of nothing but dividends and not have to sell your stocks... you know those things that make you money, but stop making you money once you sell them. Much harder to out-live your retirement money if you have good dividend stocks.
Plus there's the psychological factor. I love seeing those dividends come in each month or quarter. If you only have a little to invest, those dividends won't be much and may not seem worthwhile. Maybe that's why people are so down on them. BUT, once you get $100k to $200k invested (you'll get there eventually if you keep at it), those dividends aren't so little anymore. Plus, you can take those dividends and buy more stocks with them (growth stocks if you want)... without having to sell any of the ones you already own.
If you're investing for money to use now, in other words, in a taxable account, then yeah, growth is likely better. If you're investing for retirement, it's not so clear-cut.
The problem with growth stocks is, they don't always grow. Sometimes you can spend months or years watching them go down, down, down (waves at 2022, 2020, 2016, 2008, etc.). If you have some dividend stocks, at least you can see some money coming in while you wait for your growth stocks to rebound (and have money to buy more stocks with, while the prices are cheaper).
It's all-to-common for people to hate on dividend paying stocks nowadays, but don't dismiss dividends just because they're not the tippy-top of profitability. They have their advantages as well as their disadvantages just like growth stocks.
Totally agree!!
The amount of people that don’t know dividend stocks can be tax advantaged without a Roth IRA is sad…
Qualified dividends peeps. You pay 0% if you earn less than $40k in divs in ‘21 as a single filer in the US. And if you’re earning more than that in Divs you’re likely financially free. Divs>growth for my portfolio
The 40k is gross income, not just dividend income. If your salary is $40k or higher, you’re paying taxes on any dividend you receive.
@@2k3SteedaGT This is true. For me, I get 1700 USD a Month in Military Retirement... meaning I don't pay Taxes until my Dividends hit 40K a Year. Pretty nice for people on Fixed Income like myself.
If you make over 40k with dividends and annual earnings combine you will be taxed in a account outside a roth IRA
You can also invest in accumulating ETFs to avoid taxes everytime a dividend is paid and still have the benefits from dividend investing
Dividends are payments from the company to the share holders.
Growth profits are payments from share holders to share holders.
So share holder value just means: grab the money from the share buyers and then let the share holders pay each other the profits.
My MSFT, AAPL, NVDA, and COST stock would like to disagree with your “low growth” 😊
THEY ARENT DIVIDENT STOCKS!!!
they pay dividends but its lower compared to actual stocks that people would a greater percent get for dividends
@@filip9564 they are dividend growth stocks. Aapl, msft etc
@@suttsd Can't be a Dividend Growth Stock if you aren't a Dividend Stock. You basically saying "It's not a Horse... it's a RACE HORSE!"... that's still a Horse, dude.
Costco even pays fat bonus dividends from time to time those are most certainly dividend stocks
Well, there is a thing called Roth IRAs. That’s where you should have dividend stocks, unless you are trying to get a passive income close to retirement or already retired.
In Australia fully franked dividends already have the tax paid and is a tax write off not a tax payment event. Food for thought.
If you're in the UK you can just use an ISA and it's all tax free limited at 20k deposit per year.
Omg no. If they are qualified dividends, it’s long term capital gains tax rate. Which is 0% until $44k annually. You have to have a massive amount of capital gains to have a taxable event.
I don’t want to have to sell part of my growth stocks to receive money. With dividend stock you don’t have to. With compounding its competitive in returns as well.
Reinvest the dividend amount. Capital gains are different for everyone. Depends on income, marital status
That's why you put your high yeild etfs, and stock in your roth ira. And growth in your brokerage
Mr Hawkins Gary is the best,recommending him to all beginners who wants to recover losses like I did
I still wonder how he gets his analysis,I got profit of $40,000 with a capital of $4009 in 21 days of trading with him
How much exactly does he make of you in every trade don’t mind me askin
To be honest I invested as low as a thousand bucks because I was skeptical initially.Receiving my profits gave me more confidence to try aga
Life was hard for me until I started trading Bitcoin and am now earning $19,435 per week
I just confirmed that he is a licensed broker,I would like to work with your trader 😪,how can I connect with him?🥺
Or you could just have a diverse portfolio so it's a little bit of everything
Dividend stocks smooth out the beta of a portfolio, your standard deviation will be reduced by having just a small layer of added diversification.
dividend stocks are better by a long shot. You have a shitload of dividends till you pay more
I prefer a blend, 70/30 favoring nice dividends. If you find a few good ones that are kind of both. That's really nice.
Look at the total return of dividend growth stocks and most crush growth stocks. Look up Waste Management, Texas Roadhouse, Microsoft or Visa. All way outperform the S&P 500
I like dividend stock now because I’m looking to buy a house soon, dividends don’t realize any loss or gain in your stock evaluation but get value I can use to build equity now.
The after-tax total return on dividend stocks has beaten the market over the last 40 years
If your dividends never leave your account it’s not recognized as income. So therefore no taxes as long as it’s not withdrawn from the brokerage account.
Growth is pure speculation without guaranteed return
That's also how I view it. :-)
I personally believe that while you are younger get a Roth Ira and invest in solid long time performing and paying dividend stocks to build a basis for your retirement. Dont invest in dividend stocks exclusively you definitely want the long term compounding growth of a VOO or something of that nature too. But do around a 60-40 or 70-30 split until you’re about 25.
After that switch it fully and do about a 80-20 split favoring growth indexes. You’ll have a nice basis of Dividends that will grow exponentially and give you passive income while older, and help reduce your risk to market downturns in retirement. While also having 34+ years for your growth indexes to realllllly compound.
Also ALWAYS reinvest the dividends. Always.
In one minute you explained this better than anything I’ve seen.
Dividends deposited into a TFSA to reinvest will also circumvent taxation events as well.
Dividend ETFs like SCHD provide a return even when the market is flat. You gain more shares at the flat price, and then when the tough times end, you have more shares to start growing again. A good balance between growth and dividend stocks is what I do. And when my growth stuff exceed fair value, I sell the excess and buy dividend stocks
Solution? Make enough money to be able to invest amount that will reap great benefits from both.
“Do you need passive income?”
Might be the dumbest question I’ve ever heard.
Yeah, exactly! Like who WOULDN'T want that?!
I believe a Roth IRA (USA) or an stocks and shares ISA (UK) means u don't pay tax anyway
@ for a second I thought u ment the Irish republican army which deffo don't pay tax
Enbridge pays 7.38% dividend and VOO pays 1.50% but pays yearly interest return over 10%.
I’ve tried both and I’ve personally seen better returns from dividends aswell if you’re a Canadian citizen you can use TFSA and create a diverse portfolio that could net you quite a nice return that can reinvested and ultimately creating a nice little retirement fund for yourself if you maxed your TFSA out every year and reinvested your dividends you could easy see a cool million in your account by retirement
Roth + dividend = no tax. C'mon man.
Call me a nut, but I'm buying dividend stocks specifically so I can reinvest the money. It helps that I have a TFSA, so I'm not paying any tax on those dividends or capital gains in that account. Overall, I'm just trying to snowball it.
Only if it's canadian stocks otherwise there's a withholding tax on all US dividends of 15% that you1 don't see otherwise..
@@jacobrybicki1590 Unless you buy them in an RRSP (Canada) or a Roth IRA (US). Our tax treaties mean my retirement savings plan is recognized as just that, a retirement plan, which means it's not taxed.
Not crazy at all. That's the basic principle.
You are a nut.
As a person who has not been able to invest until late in life, this will a very very helpful. Excellent video.
Definitely buy a fully franked dividend stocks with a nice growth
Narrator: “the irony was… he himself was very much a ‘noob investor’”
If you can wait 20+ years to liquidate at the mythical high finish line of growth stock potential and not touch it at all then yes youll do better with growth assuming you dont get unlucky with a recession when youre ready to liquidate or die in those 20+ years or have some emergency that you need to pull funds. On the other hand; dividend stocks will be paying you the entire time over those 20+ years to actually use and will still earn you a decent payday if you finally liquidate.
How lucky do you feel?
Right except they don’t tax dividends in every country
im from Brazil and dividends stocks arent taxable. usa is fucked up. the government wont let you hold a dollar and not pay tax on it
Isso ate o ano que vem, provavelmente vai ser 15% a taxação dos dividendos mas acredito que eles possam jogar isso pra cima. A longo prazo acredito que vai ser melhor ter ETF internacional...
VOO pays a dividend too.... so yeah taxable event created.
Voo has a dividend. 1.69% so you will still get taxes. Amazon is a growth stock with no divvy
You left a few things out. Qualified dividends have a pretty high threshold before you even see any taxes and they're in a lower tax bracket. Its a long-term compounding play. Divs can be really really good too, and if you're worried about unqualified divs. You have tax advantaged account for that.
80K+ tax free divs(qualified) for married couples are hard to beat. 40k+in growth and you start paying taxes.
Vid is obviously biased. Growth isn't bad either , it's just a different strategy.
Such a helpful breakdown, thank you!
Why would I want income? Flexibility. Life comes at you fast. Replacing income is sometimes necessary for a variety of reasons. When it’s not needed, I’m expanding by reinvesting with zero added effort. Growth stocks have no tax implication but it’s a bet with time that may or may not work out.
Buy dividend stocks today to ensure a passive income paycheck in the future
Although I have a mix of dividend + growth. I prefer dividends for stability and I cant lose all my money
Good thing that in Brasil, dividends are tax free
As they should be. Sad that everything is taxed over here :(
@@MightyElemental why should they be?
In my country, we got no tax for dividend as long as the money is reinvested again in 3 years, atleast that's how i remember
If you have your dividend stocks in a roth ira then the point made about tax is moot. Of course you only get 6.5k contribution limit per year but still. In my opinion better to have both growth and dividend stocks together in the appropriate accounts
Best is to have a mix. If your 100% in growth stocks, your 100% exposed to volatility. Having both types of stocks hedges you against making a fatal mistake in timing. In other words, it might be better to make 50% of something than 100% of nothing.
I might not be 100 percent right, but I believe 1 3rd of VOO's gains comes from its dividend.
Or can help if your job hopping, retire a bit early.
Or simply need extra cash.
Don't forget to sell covered calls.
Buy both
I buy
60%growth
40% dividends
It helps me keep a track of progress I'm making when I get notifications of 50p made in dividends even though its dose not add up to alot now its a reminder that I am making progress and I'm investing for a reason
Ps certain investing accounts don't use dividends as tax events untill money is taken out of the account