CASH SURVEYS FROM SENDEARNINGS.COM

Decided to cap of my best month of dividends for 2013 by making a little extra cash on Sendearnings.com.  Just finished 2 paid surveys and a couple of paid searches and I'm only a $1.12 away from earning another check!  While I don't earn tons of cash from Sendearnings, it is by far one of my favorite shoppers' rewards programs.  I get cash back for shopping, paid searches, paid emails, paid surveys and I get paid for printing and using money saving coupons on some of my favorite brands.  Doesn't get much better than that.

I plan on adding all my rewards checks to my investment account and purchasing more dividend stocks to keep the money turning.  (If you're interested in checking them out it's free to sign up, see the banner link at the top of the page).

After such a good month in April, I'm really looking forward to May's dividend payments.  I still have one monthly dividend payer to start paying in May, so I'm pretty excited about that.  Love watching the payments roll in!  It doesn't even matter if it's the small payments, it all adds up.  With all dividends currently re-investing, the amounts increase each and every month.  It's like having a job where you get a raise every month.  It will be interesting to see how May's cash flow compares to February (the second month of the first quarter).

MY CURRENT TOP TEN STOCK AND FUND HOLDINGS

 The following is a current list of my top ten stock and fund holdings.  This list is for informational purposes only and should not be construed as investment advice.

Each investor has their own goals and risk tolerances and should thoroughly research and evaluate all stocks and funds before they invest.
 

My Top Ten Holdings include:        

 1.  Universal Insurance Holdings  UVE Div. Yield 5.71%

 2.  Lilly and Co.  LLY  Div. Yield 3.47%

 3.  General Electric Co.  GE  Div. Yield  3.46%

 4.  New York Community Bancorp  NYCB  Yield 7.47%

 5.  Cornerstone Strategic Value Fund CLM Yield 17.15%

 6.  Hanesbrands Inc.  HBI  Dividend Yield  1.63%

 7.  Hawthorn Bancshares Inc.  HWBK  Yield 1.69%

 8.  RR Donnelley and Sons Co RRD Yield 8.22%

 9.  Centerpoint Energy Inc.  CNP  Div. Yield 3.41%

10.  Allianzgi Convertible and Income NCZ 11.70%

My current top 10 unintentionally leans a bit towards financials (Banks and Insurance Companies), but overall it's a pretty diversified mix.  I expect this list to change in the coming months, so I'll post an update around the end of each quarter.

Collected my last dividend payment for the month from GE, thanks Mr. Immelt.  Have a great weekend!




  

JPMORGAN CHASE DOWNGRADES GE

Just finished reading an article on CNBC.com about JPMorgan's downgrade of GE.  They've changed their rating from "buy" to "neutral".  While I agree their past quarter may not have been stellar, I disagree with their overall analysis.  The same article talks about GE's massive cash hoard (around $90 Billion as of March 31st).  They also talked about some positive changes to GE's business portfolio which I think will cut losses and improve profitability going forward. 

I'm no fan of JPMorgan Chase in the first place, because of the experience I had with them as a credit card holder, but in this case they may have done me a small favor.  All the people who do take their advice and bail on GE will drive the price down, making it easier for me to pick up additional shares at a lower price.  As long as GE does not cut their dividend (which seems unlikely anytime soon given the amount of cash on hand and share buybacks), then a lower price per share means higher dividend yields.  As a long term investor in GE, I'm thinking this is a good thing.

LAST 3 STOCK PICKS TO ROUND OUT MY INVESTMENT PORTFOLIO

Finally decided on my last three blue chip stocks to complete the purchasing phase of my new portfolio.  With the 4 quarterly payments from HBI and the 12 quarterly payments from my next 3 stock purchases, I will be collecting a total of 111 dividend payments per year.  How's that for compounding?


One hundred eleven payments per year works out to 9.25 dividend payments per month or about 2.14 payments per week, on average.  While this is not the dividend a day that I had been shooting for before my last heart attack, it's still quite good and much easier to manage.  I'll be invested in a total of 19 different stocks and funds, which is quite a few, but still an easily manageable amount.  

As for the final picks to round out my portfolio, I've decided to purchase shares in Coca Cola (KO), Wells Fargo (WFC) and Intel (INTC).  These will be long term investments for me and I was looking for stocks with earnings and dividend growth potential.  I also wanted to go with big brands, since I took on more risk with some of my higher yield holdings.  I think these three stocks will bring balance and help reduce risk over the long haul, while providing good potential for rising dividends over time.  I'll be adding these three stocks to my portfolio over the next two quarters, then I'll concentrate totally on building positions in my current investments for increased monthly cash flow.  

HBI NOW PAYING DIVIDENDS!

                        

Wow, seems like it's been years since I received my small stake in Hanesbrands Inc. (HBI:NYSE) as part of a spin off deal from Sara Lee.  Even though the stock has performed well, I never bought any additional shares because they did not pay dividends.  However, I now intend to purchase additional shares of the stock since they will start paying dividends in June of this year. 

HBI inherited a great deal of debt in the spin off from Sara Lee, but you've got to hand it to the guys in charge, they've done a wonderful job of reducing debt and revitalizing the brand.  I've always worn Hanes underwear, socks and t-shirts, but with their recent ad campaigns, it seems like a lot of other people are doing the same.

As a dividend investor, it seems counter intuitive to hold on to a company that doesn't pay dividends.  In this case though, I've always believed in the brand and I believe the in the old saying, "Good things come to those who wait."  Can't wait to see what the folks at Hanes have in store for us next, but the future is definitely looking up!

 

DREAM VACATION

Goals are very important in investing and it's good to dream of things you'd really like to do when you've reached your goals.  My idea of a dream vacation would be a couple of weeks on the beautiful beaches of Brazil.  While I'm not much interested in traveling outside the U.S., I'd make an exception to spend some time at a nice beach resort in Brazil.

DIVIDEND INCOME FOR APRIL MORE THAN 3 TIMES JANUARY 2013!

As further proof that my investment plan for 2013 is on track, the total dividends for the month of April are more than three times the amount earned in January of this year.  It's a great start to the second quarter.  I still have 2 more dividends to collect before the end of the month, which will bring the total to nearly four times January's total!  Like I said in an earlier post, I don't expect the increases in monthly income to be so dramatic for the rest of 2013, but I'm off to a great start.  

Stock price appreciation has been more than enough to recoup the amount spent on commissions during the accumulation phase.  Now that I've moved to phase 2, commissions have dropped since most new investment is from re-invested dividends for which there is no commission.  Every 3 months for the rest of 2013, I'll be investing money from my monthly cash contributions.  Since I'll be buying more shares at once and paying the same amount in commissions as I paid on smaller purchases, it will lower my overall investment costs and should boost returns going forward.

I have to admit, the massive national debt brought about by the current administrations' economic policies has caused me a great deal of concern, but in the end I decided when people finally realize what a disaster it has been, things will change.  Whether the change is good or bad remains to be seen.  It's just another factor to consider when making the decision on where to invest your money.  No matter what kind of obstacles Washington may throw out, "this too shall pass."  As far as I'm concerned, there are good times to invest and better times to invest and hoarding cash is mostly a losers game due to inflation and taxes.  Better to put your money to work.

BUILD YOUR CASH CUSHION

"Time and unforeseen occurrence" catches up with everyone now and then.  As in the case of my heart problems over the past couple of years.  Aside from one of the best cardiologists in central Missouri, having a "cash cushion" helped get me through the tough times.  As it turned out, the amount I'd set aside in cash was not quite enough, but it went a long ways towards keeping the lights on and the wolves from the door, giving me time to get my health and my finances back on track.

How much should a person save?  A standard recommendation is 10-20% of your income.  However, the truth is, everyones' situation is different.  Whatever dollar amount you decide on, remember that saving something is the most important goal.  Even if it's as little as $20 per month, it's establishing the habit of saving that's most important.  Once you've got that down, it's much easier to work towards a specific goal.

Now that I've got my base portfolios in place, one of the things I've done to make more cash available is to delay investment of contributions and keep more cash in my interest bearing account with my online brokerage.  Should the need arise, it's readily available for transfer to my savings or checking account.  Each quarter the money is automatically invested in more stock to build my dividend portfolio.  For the time being, I'm having all dividends in both accounts re-invested with the goal of building monthly cash flow as rapidly as possible.  By the end of this year, I'll change my taxable account to pay all dividends in cash and build additional cash reserves in my interest bearing account. 

It has been a rough few years for us all.  No one knows what the future holds in store, but it's a sure bet that future will be just a little brighter if we all make an effort to put a little extra away for a rainy day.

THE IMPORTANCE OF INVESTING WHILE YOU'RE YOUNG

I was trying to explain dividend investing to a high school kid I
work with this past week.  I told him about the new portfolio
I’d set up to rebuild my IRA and my taxable account.  I
explained compounding to him and how someone of his age
would benefit greatly by starting an account at 18 and
re-investing all dividends.  He would probably either be retired
by my age or earlier if he starts while he’s young.

He didn’t understand why everyone wasn’t doing it, if it was
seemingly so easy to set up a dividend portfolio and build
wealth so easily.  The part he didn’t get was that not everyone
knows how to get started and a lot of people simply lack the
motivation and will power it takes to set the money aside for
investing and leave it there.  Life happens, like the 3 heart
attacks I’ve had, which can leave you broke or in debt and you
have to start over.

In this kid’s case, he’s very disciplined as far as saving.  In the
two years he’s worked with me, he’s saved over $10,000, which
I think is impressive enough for anyone at such a low paying
job.  However, it’s especially impressive when you consider he
was only 16 when he started.  He’s a senior in high school now
and plans on going on to college in the fall and I’m sure
whatever he decides to do, he’ll do quite well.  His parents
chose to home school their children and they’ve done an
excellent job.  Whether he’ll decide to take my advice on
investing or not is anybody’s guess.  I just wanted to peak his
curiousity and perhaps he’ll use it to his advantage somewhere
along the way.

Several of the high school kids I worked with
back in the mid 90’s took advantage of my advice.  I recently
ran in to one of them.  He and his wife both worked with me
back when they were in high school before they were married.
I got them interested in DRIP investing and helped them set up
accounts with a few good companies.  I asked him if he still
owned his stock.  He said yes he still owned the original stocks
and still participated in the DRIP programs, but he’d also
recently added more shares to his investments and has done
quite well over the years.  I know that most of their success has
been from their own hard work, but it makes me feel good that
some of my advice has helped them along the way.

The thing I really try to stress to young people is the power of compounding.  At such an early age a person can start with such a small amount and with years of compounding, end up quite wealthy.  Like Judge Joe Brown says on his show, "Pay attention, and you just might learn something."

DOUBLED MONTHLY CASH FLOW IN FIRST QUARTER

If I needed any proof that my investment plan was on the right track, I finally have it.  From the start of the first quarter of 2013 to the start of the second quarter, monthly cash flow from dividend payments to my investment account have more than doubled.  While I don't expect to repeat this from the second to the third quarter, it is possible to see at least another 50% increase from now until then.  We'll see how it goes, but it looks as though my current plan is working out quite well.