Saturday, March 3, 2012


This year I've made some radical changes to my investment plan.  Due to tax law changes regarding 1099's I've decided to reinvest dividends in my IRA account only.  All dividend payments in my taxable account I'll be taking in cash.  I may decided to reinvest some of this money in lump sums at a later date, but I no longer intend to reinvest small amounts, avoiding the extra work I had to do on this years taxes due to sales of some shares last year.

Another change, which represents an entirely new direction for me, I've decided to make it my goal to earn a dividend payment for every day of the year.  The plan is quite simple really.  Between my retirement account and my taxable portfolio I plan to purchase shares in 92 companies paying quarterly dividends.  This will bring my total dividend payments per year to 368 (92 stocks x 4 dividends each per year = 368 total dividend payments).  While I'm sure most "professional money managers" would think I'm crazy, I think it will work for me.  Consider this, if the rate of compounding determines your ultimate investment success, what better way to invest than daily compounding.  While this may sound overly ambitious for a small investor, I believe it's quite within grasp.  I already own shares in 40 companies between my two accounts, so I only have to buy shares in 52 more companies.  I've already identified several good investments with a calendar of purchases scheduled for the rest of 2012.  I'll be buying shares in at least 2 companies per month.  One new company for my taxable account and one for my IRA.  This will also accomplish my goal of reducing taxes for 2012 by increasing contributions to my IRA. 

Daily dividend payments are the ultimate goal here.  Once I've accomplished that, I'll work on building positions in each stock.  Think of it as making every day of the year payday.  What could be better than that?

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