BOOSTED MONTHLY DIVIDENDS BY OVER 6%!

It's nearing Christmas and I haven't done any shopping yet.  But I have the next couple of days off, so I'll get it all done then.  In the mean time, I put some of my Christmas bonus to work, investing equal amounts in AGNC and NRZ for a boost to monthly dividend income of a little over 6%!  Dividends from the new shares purchased will kick in in January 2019, which I figure is a great way to start off the new year.

Yesterday's big drop in the stock market has a lot of people running to cash.  Quite understandable, especially since 2008.  However, I have no intention of abandoning my dividend investment strategy.  I'm looking at the situation as an opportunity to buy more dividend income at a lower price.  What the market does tomorrow or next week or next year is really anybody's guess.  But if you're collecting a nice stream of dividend income every month, it becomes almost irrelevant since you're not likely to be selling your shares.

Currently, I'm showing a loss on most of my investments.  That may continue for quite some time.  But I'm not panicking as long as they continue to pay dividends.  I have to admit it's tempting to take all the dividends in cash, just to be on the safe side.  However, I think it's better to reinvest the dividends at the new lower prices and reduce my average price per share while I have the chance.  I'd feel pretty stupid about building up a big chunk of cash and then the market takes off again and I'd have lost out on the chance to pick up some bargains.  So I'll keep reinvesting dividends until I actually need the cash.

KICKED OFF DECEMBER WITH 5 GREAT DIVIDEND PAYMENTS!

Now that the transfer from Capital One to Etrade is complete, it's time to get busy building monthly dividend income again.  I'm happy to report, I collected 5 great dividend payments for the first of December, reinvesting 4 to buy more shares and taking the remaining payment in cash.

I've taken a new approach to reinvesting dividends since switching to Etrade.  If the stock is more than what I paid for it, I take the dividend in cash and if it's selling for less than I paid, I reinvest the dividend.  My goal is to reduce the average price per share on the stocks that are down in price by reinvesting dividends at the lower price.  This will put me in a better position to benefit from a recovery in share price on these stocks.  As for taking cash payments from stocks that have gained in price, it may seem like it would be better to buy more shares of something that's doing good.  However, my thinking here is, I don't see any of them doing well enough going forward to justify raising my average price per share by reinvesting dividend payments.  So instead I'll take the cash and use that where I see more opportunity.

I'm still wanting to purchase a larger stake in AGNC.  I like their monthly dividends and the high yield, but I mostly like their numbers which lead me to believe they can continue paying the dividends.  So I'm wanting to build up a large stake in my Roth account to add to monthly cash flow.  I do own shares in all three of my investment accounts now and plan on keeping them for the long haul.

TURNING A NEGATIVE LIFE EVENT INTO A POSITIVE

A couple of weeks ago, I got woke up at 2 am. by my neighbor pounding on my front door.  He told me someone just messed up my car.  Apparently a hit and run driver ran off the road, crashed into my car in the driveway and took off.  One look at my car convinced me it would be totaled by the insurance company.  Right then and there I decided not to let this be a catastrophic event.  I had full coverage on my car, so I knew I would get something for it.

As it turned out, the police were able to catch the driver of the other vehicle.  However, when I called to file a claim with his insurance, they told me his insurance number was invalid.  So I had to file a claim with my own insurance.  They sent a tow truck to tow my car to the body shop for an estimate on repairs.  I was still convinced they would total the car, so I began looking for a replacement.  I estimated what I thought I'd get after the deductible and shopped online for a car with comparable mileage to my old car and within the price range of the insurance settlement.  I did research on used vehicles concerning reliability and gas mileage while I shopped and narrowed my picks down to a Toyota Corolla or a Ford Focus.  When the insurance company called to tell me they'd decided on a total loss and confirmed how much they'd be paying for my car, I went and bought the Ford Focus.  I'd have preferred the Corolla, but it was already sold.  

After all was said and done, I bought a car 6 years newer than my previous car.  It was priced at $2,400 but I got it for $1,950.  It needs a few minor repairs, which I'll pay for with the $650 I had left over from the insurance money after buying the Focus and getting it licensed and insured.  My insurance is less on the newer car and I'm averaging 28.5 miles per gallon on gasoline, so I'll save money going forward.  Should I have any money left after making repairs, I'll put that toward purchasing more shares of a monthly dividend stock, so I can continue to collect from this incident.  Also, should my insurance be able to collect from the driver of the other vehicle, I'll be reimbursed for my $500 deductible.  

So with a little thought and action on my part, I took what could have been a very negative situation and turned it into a positive one.    

FIRST STOCK PURCHASE THROUGH ETRADE

I made my first stock purchase through my new Etrade account.  Decided to buy more shares of AGNC for my Roth IRA and my regular taxable account.  AGNC's numbers look very promising and I love the monthly dividends.  Their monthly dividend of eighteen cents per shares works out to a 12.34% yield on their recent price of $17.42 per share.  With earnings per shares far exceeding current dividend payouts, I think it will be a good pick for my portfolio going forward.  I wouldn't suggest anyone else buy into it without first doing some research to see if it fits with their own investment plan.  

My car was totaled by a hit and run driver while parked in my front driveway last week.  So it's been a hectic 2 weeks, replacing my vehicle, dealing with the insurance, working extra hours and spending time with the family for Thanksgiving.  I'm very tired, but happy to report that it all worked out well.  With a lot of research, I was able to buy a car 6 years newer than the one I lost, using only the insurance settlement and none of my own money.  Actually had about $460 left over, which I'll use to get any work needed on the car.  I bought a smaller car with much better gas mileage, so it should save me a great deal going forward.  I'm pretty happy with the way it all worked out.

With market prices down, I'm currently reinvesting all dividends.  I figure I'll take advantage of the lower prices to pick up more shares of current holdings at lower prices.  It will also help reduce the average price per share.  So when the market eventually goes back up, I'll be in a much better position to profit on my holdings.  In the mean time, I'm happy to keep collecting the dividends and watching the payments increase month after month.

MOVE TO ETRADE COMPLETE!

It was a long time in coming, but the transfer of my investment accounts to Etrade is now complete.  While I've been spending a lot of time getting acquainted with their format, I think I'm really going to like the move.  I made my first cash deposit into my taxable account.  I had drawn quite a lot of money out before the move, mostly to pay for medical bills not covered by my insurance.  However, I'm in a position now to start replacing the money I took out, thanks in large part to the extra cash I've been earning from Prizerebel, Swagbucks and MyPoints.  

Haven't decided on my first stock purchase yet.  I'll probably go with a monthly dividend ETF.  Most likely it will be one of the ones they offer with no commissions.  Haven't figured out how to find those yet, but I know they offer them.  I could just buy more shares of SDIV, but I think I can do better income wise.  So I'm going to shop around.

I did get signed up for dividend reinvestment.  Want to take advantage of the current lower prices in the market to add to all my positions.  Also leaning very heavily toward adding a great deal to my position in AGNC.  As a dividend investor, I love the monthly dividends with the 12.14% yield, but I'm especially crazy about their earnings per share of $3.17 compared to their annualized payout of $2.16!  Add in a price to earnings of only 5.65 and I think I'd be crazy not to buy more.  I'm always cautious when it comes to real estate trusts because I've been burned in the past.  However, in those cases they were paying out huge dividends without the earnings to back it up.  So I'm pretty optimistic about this one.  I already hold shares in my IRA and Roth IRA, but I think I'll boost my holdings in the Roth account as soon as I have the available cash.

If my workplace comes through with the Christmas bonus this year, I plan on investing the majority of the money.  We haven't had a very good year, so I'm not sure whether we'll get a bonus or not.  I would think so, but in case we don't, I don't want to be disappointed by not being able to go ahead with my investment plans.  So I'm looking at ways to boost my investments and dividend income outside of getting a bonus.

My 401k just keeps racking up the cash.  The investment performance is lackluster at best and I hate the fees.  But I would not have that money in my portfolio if it weren't for the 401k, since the deductions from my paycheck come mostly from taxes.  So I'm pretty happy to see the balance increase every payday.  When I'm ready to retire, I plan on rolling that money over into my Roth IRA.  It should provide a substantial boost to monthly dividend income and I'm pretty happy about that.

MOVE TO ETRADE NOVEMBER 5th

Well it's been months in the making but the move from Capital One Investing to Etrade is finally near.  As of Friday Nov. 3rd all accounts will be transferred to Etrade and available for access on Monday, November 5th, 2018.  I'm actually pretty excited about the move.  I made a lot of changes in my holdings prior to the move, so it will be a fresh start with Etrade.  Can't wait to get things moving again.

Just as an update, I'll still be collecting 496 dividend payments per year from my current holdings.  This does not include any dividends paid through my 401k account.  I also receive 40 interest payments per year.  While total dividends and interest are still way short of the amount I'd need to live on, they are increasing every month.  I've also started to make a substantial amount on my side gig doing surveys on the internet.  So 2018 hasn't been an entirely bad year for me.  

HEALTH ISSUES SLOW BLOG POSTS

I didn't realize until today, that it had been over two months since I'd posted to my investment blog.  I've been dealing with health issues, mostly related to advanced osteoarthritis.  I was at the point of losing my ability to walk, but with the help of a good chiropractor, I'm doing much better now.

Being distracted does not mean I've been inactive.  On the contrary, I've made several adjustments to my portfolio in the past couple of months to boost monthly dividend income.  I've also streamlined my investments by selling off some individual shares and putting the money to work elsewhere.  Unfortunately, health care is expensive and I had to take money from my taxable investment account to pay for some of my care.  This has only been a minor setback, since at the same time I was adding to my 401k and reinvesting monthly dividends.  So my total investments are about the same as before, except for the recent drop in market prices.  

Speaking of the drop in market prices, I'm thinking this may be a good time to add to some of my positions, reducing average price per share by buying additional shares at the lower price.  I'll be looking for opportunities to do this after the transfer of my accounts from Capital One to Etrade are completed.  In the mean time, I'm letting dividend payments accumulate as cash balances in my accounts.  While I'm big on automatic reinvestment, since it avoids commissions, I've seen some advantage to taking all dividends in cash.  The main advantage being that I'm able to direct the cash towards the higher dividend paying stocks.  While commissions eat into that somewhat, the higher monthly payments may make it all worthwhile.

One thing I'm excited about with Etrade are all the funds they offer with no commission charges.  I've already bought a stake in SDIV which is available through Etrade with no commission charges.  I also like the fact that I can select which stocks to reinvest dividends and which ones to collect cash.  Of course I was able to do this with Capital One as well, but I'm glad I'll be able to continue doing so.

Made some advancements in paying down old debt, which I'm very happy with.  I'll be even happier when I get the first one paid off entirely.  After I pay off the first bill, I'll be directing the money from that payment towards paying off the next one, so they'll be dropping fast!  I'm pretty excited about that!

Last month I looked at the paid survey sights I'd been working with online, with a view to increasing income from those.  I'm happy to report a dramatic increase in income from this source.  Not only will it help to pay off old debt, but it will be a boon to my investment accounts, since I'll have more free cash to invest.  I like the idea of turning money into more money!

CASHED IN GAIN ON HWBK AND BOUGHT MORE AGNC

I'd been sitting on a gain of over 51% on my HWBK shares in my IRA for quite some time now.  While I think it's a pretty decent stock, I wasn't really making much in dividends.  So I sold all shares, collected the gain and reinvested the money in more shares of AGNC.  This more than doubles the amount of money I was earning in dividends from HWBK for the same dollar investment and the dividend is paid monthly.

AGNC has a dividend of .18 cents per share or an 11.59% yield on their current price of $18.70 per share.  Their price to earnings is 5.4 with earnings per share of $3.46.  Since the stock price is currently down from my initial buy in price, I've also lowered my average price per share.  Overall, I'm pretty happy with this trade and look forward to collecting dividends from AGNC for many years to come.

BOOSTED MONTHLY DIVIDENDS ANOTHER 1%!

With Capital One Investing transferring all their investors accounts to Etrade in August, I was forced to sell fractional shares from reinvested dividends.  After liquidating the shares, it occurred to me that I could reinvest the money in mutual funds which allow for fractional share transfers.  So I took the cash from the fractional shares and used it to purchase additional shares of FTF and ZTR.  The new shares will boost monthly dividend income by 1%!  So as it turned out, this wasn't an entirely bad thing.  I took lemons and made lemonade.

Now that I'm finding out more about Etrade, I've decided to keep my accounts with them instead of transferring to TD Ameritrade.  While I still think TD Ameritrade is better, I believe I can work with Etrade and avoid the hassle of moving my accounts a second time.  

Can't say I'm especially proud of the performance of my 401k, although the account is making money.  It's just not making much money.  I've always thought TransAmerica was a very good company.  They're the ones managing my 401k.  I have to say I'd really like to see on my account statements when or if my dividend funds payout dividends.  For some reason, that information is not provided.  Otherwise, I'm O.K. with how things are going there.  I'm certainly stockpiling a lot of extra retirement savings I probably wouldn't have, had I not signed up for the 401k.

Can't wait to get things moving with Etrade.  I've researched some of their "no fee" funds and have already purchased a stake in one.  I have another one I'd like to buy shares in as cash permits.  That probably won't happen until my accounts are transferred over.  I'll have to get my dividend reinvestment program in place.  It's a little more involved with them than it was at Capital One, but it doesn't seem especially difficult.  I'm excited about the move.  Sometimes change is good.

KEEP YOUR MONEY MOVING!

I've been reading a lot lately about the laws of attraction, especially pertaining to attracting money.  One thing that struck me as really profound is that money is energy and needs to be in a state of flow.  Normally people think of money as coming in and flowing back out to bills and expenses, but we should never forget it's just as easy to spend your money on tools to make more money as it is to spend it on things you probably don't really need.  

I have a weakness for electronic gadgets and have a tendency to spend too much money on them.  Even though I know I don't really need them.  Lately I've taken to asking myself whether these things will increase or decrease cash flow.  So I've cut way back on the amount of money I spend on things and use it instead to buy more dividend stocks to increase money coming in.  If you get in the habit of spending your money on things that will bring you more money instead of things that collect dust around your house, eventually you'll be making way more than you ever thought possible.  

So you need to keep your money moving.  But most importantly, you need to keep it moving in the right direction.  Make a habit of it.  Once it comes in, pay yourself and put that money to work earning you more money.  Then pay your bills and expenses and if there's anything left, you can buy the extra things that you want.  

SDIV REPLACES NRZ AS MY FINAL STOCK PURCHASE WITH CAP ONE

After doing a little more research on Etrade, I decided I may leave my account with them after it's transferred from Capital One.  With that in mind, I looked up a list of their commission free funds and identified two monthly payers with high yields and low price to earnings.  So I cancelled my purchase of NRZ and put in an order for SDIV instead.  Once my account transfers to Etrade, I'll be able to purchase additional shares of SDIV commission free!  Not to mention this initial stake will increase monthly dividends by over 1%!

Once my account is transferred and I have the DRIP plan in place, I'll also be purchasing shares of SRET.  It's a REIT with a yield of 8.4% and a P/E of only 9.49 and pays monthly dividends as well.  In order to have more cash on hand, I'll be taking all dividend income from my taxable account in cash.  I'll transfer that to an interest bearing account to hold for a rainy day or in case some incredible opportunities should pop up in the future.  As for my retirement accounts, I'll be mostly reinvesting dividends, although I think I'll make an exception for the bond funds and take those payments in cash.  

At the beginning of the year, I certainly didn't expect to make so many changes.  However, sometimes change is good and you got to roll with the punches, especially where the stock market is concerned.  So I'm excited and optimistic about the changes.  I think there could be some real opportunities here to take my investments to the next level.

LAST STOCK PURCHASE THROUGH CAPITAL ONE

Just put in an order to make my last stock purchase through Capital One Investing.  I'm buying a stake in NRZ for their 11%+ yield and intend to hold on for the long term, as long as their earnings hold up.  This will increase monthly dividend income by a little over 1%.  Not a huge increase, but it all adds up.  Don't know how I'll feel about Etrade, I'm taking a wait and see approach right now.  If I don't like it, I'll switch my accounts to TD Ameritrade.  

My place of employment has become really unstable due to poor management, so I've been looking at options outside my job for earning an income.  I restarted my resale business, which is doing good so far and am considering launching a service type business involving computer upgrades.  More on that to follow.  Due to ongoing health issues, I'm not really sure how much longer I'll be able to work a regular 40 week, so I've been exploring my options.  Would love to see my health improve so I could move on to another job, but I'm beginning to think that just might not happen.

I think there's a lot of instability in the markets going forward, so I've decided to take some money off the table by collecting all dividends in cash.  I'll be holding the cash in an interest bearing account and waiting for future opportunities to put it to work.  While this will slow the growth of my investment portfolio to an extent, I'll still be adding more through my 401k at work.  

PAYING OFF DEBT

A couple of months back I got really angry about the amount of interest I was being charged each month on my credit cards and charge accounts.  So I decided it was time to get serious and work out a plan to pay them off for good.  So I started with the highest interest charge account.  I've been paying my regular monthly payment and making 2 additional payments each month with money earned from swagbucks.  I've already got the balance down low enough that the two swagbucks payments would actually pay the monthly bill.  I'm going to continue paying the three payments per month for a couple more months, then I plan to finish paying the bill off with swagbucks cash and divert the $70 per month I normally pay on this bill towards paying off the next bill.  Once I have the second bill out of the way, that frees up $180 per month to rapidly knock out the third bill.  I'll just keep repeating the process until they're all paid off.  At the rate it's going, I'm estimating it will take two and a half to three years.  

Once all my charge accounts are paid off, I really only need to work 3 days a week to cover all my regular monthly expenses.  Most likely I'll continue to work 5 days a week and add the extra money to my investment accounts.  While using all available income to reduce debt, my investment accounts continue to grow through 401k deposits each payday and the 502 dividend payments I receive each year.  It's exciting to see my debt levels dropping instead of increasing!  

If you'd like to earn a little extra cash to invest or payoff debt, I highly recommend Swagbucks.  You can sign up by clicking the link in my Link Exchange on the right side of this page.  It's free, it's easy and you can make some cash!

SOMETIMES YOU JUST HAVE TO ASK FOR MORE

At the first of 2018, I asked myself how I could make more in dividend income.  Just asking the question got me looking at ways to earn more per month and I've been able to increase monthly dividend income by a considerable amount without adding any additional cash out of pocket.  Then I asked myself how I could pay down my old debts and cut the high cost of interest charges every month.  That got me looking for ways to accomplish this and I've made considerable progress in that direction as well.

Monday of this week, I met my boss at the door to her office and asked for a raise.  I had very good reasons to ask for a raise, I never miss work, I'm highly trained for my position and I always do more than is expected of me.  Unfortunately, the company I work for is not very forthcoming with raises.  So I took the initiative to ask for a raise.  I figured I have nothing to lose, either I'll get it or I won't, but it's a sure bet that if I didn't ask, I was not likely to get one.  Didn't get a definite answer to the affirmative, but I got things moving.  They're submitting a request for a raise to the corporate office.  We'll see if it works out.

So now I've been asking myself how I can increase sources of income outside of work, without taking on another job.  Not that I'd mind working part time at another job, but my health just wouldn't permit it.  So it's time to ask what can I do and forget about what I can't do.  I'm making 6% of my income outside my job at the present time.  Three percent is in the form of dividend income, the other 3% comes from money I earn over the internet.  Since asking myself how I could come up with other sources of income, I've had several ideas.  My goal is to boost income outside of work to 10% of total income by the end of the year.  All this just took a little thought on my part and I began the thought process because I asked.

MAY BEATS PREVIOUS DIVIDEND EARNINGS RECORD BY OVER 10%!

As I mentioned in an earlier post, I expected May 2018 to set a new record for dividend income and I wasn't disappointed.  It not only set a new record high for monthly dividend income but it beat out the old record by over 10%!  In a year over year comparison, the income for this month was nearly double that of May 2017!  While I wish I could see that kind of improvement every month, I'm not really expecting as much for the rest of the year.  I expect gains will be much more moderate, as my efforts to squeeze as much dividend income from my investments have pretty much gone as far as they can at this point.  From now on, increases will come mostly from re-invested dividends and whatever extra cash investments I make.  Still, I'm very happy with the results of my efforts for the first 5 months of the year.  

Collected 12 dividend payments for the last day of the month.  Will collect several more payments tomorrow to kick off the month of June.  All the rearranging I did in my investment accounts had an unexpected benefit, in that it spread income payments out more throughout the month.  I'm now getting more middle of month payments and more payments between first, middle and last of the month.  I suppose it doesn't really matter when you get the money, but it's kind of nice to have some coming in every week.  While I collect 502 dividend payments per year now, most of them were paid on the first, 15th and last days of the month.  Now I still get the big paydays but also get 3 or 4 smaller paydays interspersed throughout the month.

Made an extra $50 this month on Swagbucks!  That doesn't sound like much, I know, but you should see how much faster my charge accounts are dropping since I've been using Swagbucks earnings to pay off my old debt.  I knew it would help, but I'm amazed at what a difference that little extra payment has made in eliminating debt.  I'm pretty excited about it.  Once I finish paying off my bills, I'll go back to investing all the extra money I earn through Swagbucks.  If you're interested, you can sign up for free!  Just click on the Swagbucks link in my Link Exchange on the right side of the page. 

BECOMING FINANCIALLY INDEPENDENT

Over the years I've come up with several ideas for becoming financially independent,  which to me means I only work because I want to, not because I have to.  My most recent idea was to get 1,000 referrals to swagbucks who average making $25 each per month (which is easy to do by the way).  Then my referral income of $2,500 per month would mean that I could stop working anytime I wanted to.  In my case, I don't need a huge income to live on, so I could live quite comfortably on that amount.  While I may never get to 1,000 referrals the idea here is to keep coming up with ideas until I figure out one that I can make work.  Had I done this when I was younger instead of putting all my energy into working at a job, I'd most likely have succeeded by now.

The whole point I'm trying to make here is, there are any number of ways to become financially independent.  You could do it by saving and investing, starting your own business, building a better mouse trap or creating a popular new app.  Whatever the case, you just have to figure out how you're going to do it.  So far I haven't been able to make any of my ideas come to fruition, but that doesn't stop me from trying or from coming up with new ideas.  In my case, I've noticed that even my failed ideas are not really failures.  When I was an ebay seller, I didn't make a fortune but I made money.  I make money from my investments every month, even though it's not enough for me to live on.  I make money from swagbucks every month.  I made money when I bought a rug doctor and cleaned carpets and I made money when I was running a flea market booth.  So, even though none of these ideas actually got me out of the work force, I did make money on all of them and am better off because of it.  Now I just need to come up with an idea that works.  Hopefully you can too. 

CONGRATULATIONS PRINCE HARRY AND MEGHAN!

As an admitted Anglo file, I have to congratulate Prince Harry and Meghan and offer sincerest best wishes for their future together as husband and wife! 

NEED TO BUY MORE REEVES UTILITY INCOME FUND

Every time I get the distribution report from Reeves Utility Income Fund (UTG) I can't help thinking I need to buy more shares.  While I originally bought in at a steep price, I could buy more shares at a lower price now and reduce my average price per share.  Share price has not been a stellar performer, but the monthly distribution is what I'm interested in here.  Their current yield is 7.22% on a share price a little over the $28 mark.  While that's not as high a yield as some of my other holdings it's definitely nothing to sneeze at.  Average annual return for the past five years stands at 9.33%, including reinvested dividends.  

The real selling point for me is 100% of their distributions have been paid from net investment income and net realized long term capital gains.  Which means they're not playing the old smoke and mirrors game like some funds who cover payouts with a return of capital or some other capital source.  I also like the fact that they actually increased their dividend payout in April of this year.  So I'm looking to buy more shares of UTG while the price is down.  I've held it for a long time now and reinvested dividends, but I think I'd be wise to increase my stake before the price goes up.  

MAY 2018 TO SET NEW RECORD FOR MONTHLY DIVIDEND INCOME!

As I suspected, last month's record for dividend income didn't last long.  A quick calculation for the month of May reveals, dividend income will set a new all time monthly record!  While I'm very happy about this, here again, I don't expect it to last long.  The current month has a total of 40 dividend payments, while June has 42 and July 44.  So it looks like there may be one or two more new records set in the next couple of months.  This is especially gratifying when you consider the market hasn't done so well this year and I've added very little new money to my investments aside from my 401k.  (401k dividends are not counted with the rest of dividend income since TransAmerica does not report dividends to account holders.)

No further news on Capital One's transfer of our investment accounts to Etrade.  It's kind of put a cramp in my usual investment style.  Finally decided the forced sale of fractional shares for the account transfers would only really affect my taxable account at tax time, so I stopped all dividend reinvestment to that account and continue reinvesting dividends in my IRA and Roth IRA.  Holding off on deploying any cash out of pocket until I've finally gotten my accounts transferred to TD Ameritrade.

THE 70/30 SPLIT BETWEEN STOCK AND BOND INVESTMENTS

In keeping with my plans to simplify my investments this year, I've decided to go with the 70/30 percent stock and bond portfolio.  Which is, quite simply, you hold 70% of your investments in stocks or stock funds and 30% in bonds.  In my case I'll most likely hold the majority of my investments in broad range index funds for the lower costs.  While many people argue you can do better with actively managed funds, over the long haul the costs of actively managed funds tend to make their performance sub par compared to index funds.  Then too, I truly can't think of any fund manager I believe can consistently outperform the stock index averages.  So I'm going with index funds.

What I find especially attractive about a 70/30 stock and bond investment model is that in order to keep your mix at those levels, you would invest more cash in stocks when their prices are down.  In other words, as the stock market drops and the bond portion of your portfolio goes over 30% because of falling stock prices, you would put more cash into stocks to bring them back in line.  So you're buying stocks at lower prices because you're buying when the market is down.  In retirement, when you're not likely to be adding cash, you can continue this process by selling bonds and buying stocks when the market is down.  When stock prices go back up, you would sell a few stocks and replenish the bond side of your portfolio.  Thus maintaining the 70/30 stock bond mix.  Simplicity itself.

MAY 2018 KICKS OFF WITH 11 GREAT DIVIDEND PAYMENTS!

Just collected 11 dividends for the first day of May 2018!  Nice way to start off the month, although it was a little bittersweet, in that I collected my last dividend payments from longtime holdings T and VZ.  I sold out my positions in the majority of individual stocks in order to boost dividend income and prepare for the transfer of my accounts to Etrade.  While I probably won't stay with Etrade, I do want to make the transfers go as smoothly as possible.  

Completed the purchases of additional shares of CHI for my taxable account and ZTR for my IRA.  I think I got in in time to collect dividends on the new shares this month!  May is now a 40 dividend month, although I'll actually collect 42 this month counting T and VZ.  So I have 29 more dividends to go before the end of this month.  With that including some of the largest dividend payments, I'm expecting to do quite well for the month.  May even set a new record high for monthly dividend income, we'll see how it goes.

Finally feel like I've reached a turning point on debt, since it's actually going down instead of up.  Saw a great reduction in interest charges on my highest interest debt, thanks to the extra payments I've been making on the bill.  The first one will be the hardest to eliminate, but once it's gone, the rest should be fairly easy to pay off.  I don't really owe a great deal of money, it's just spread out over several accounts, so it's a lot of monthly payments.  I'm looking forward to being debt free and only having monthly living expenses.  Then I intend to really ramp up my investment program.  Pretty optimistic about how things are going so far.  Maybe it just took getting mad to finally wake me up to the fact that I'll be much better off without all the charge accounts.

I AM DONE PAYING USURIOUS INTEREST RATES!

Been on a kick to pay off my debt, starting with my highest interest rate account and working my way down.  Today I got a letter from an online retailer/payment website saying their charge accounts are being taken over in July by another bank and they're raising the interest rate to 24.95%!  I have been doing business with this company for over 20 years and have bought literally thousands of dollars worth of merchandise and transferred lots of cash through their payment website.  That all came to a screeching halt when I read their letter.  I will NEVER buy another product from their retail website and as soon as my account is paid off, it's cancelled.

I am sick of being charged usurious interest rates for no good reason.  I have years of payment history, never late, always paying more than the minimum.  Several paid off accounts and paid loans but my credit score is still only near 700 and I still get no breaks on the interest rates.  While at the same time, the banks want to pay me less than 1% on my savings.  It's insane and I've had enough.  I'm paying them all off and to hell with them.  I have money, I don't need to borrow theirs and I certainly don't need any more stuff.  So if I can't afford to pay cash for something I want, I don't need it.

If being angry about the high interest weren't enough motivation, I figured up how much I'll be able to add to my investment accounts each month, once all the bills are paid off.  It's a staggering amount!  So to all those greedy banking bastards, I'm saying, "Sayonara Suckers!"

RECENT TRADES INCREASE MONTHLY DIVIDENDS OVER 2.5%!

Once again I was able to make some trades and increase monthly dividends by over 2.5% with no cash out of pocket.  I did this partly because my online broker is handing over their accounts to Etrade later in the year and I wanted to consolidate my portfolio.  But I also have been on the lookout for ways to increase income from current dollars invested.  So today I sold my stakes in CNP and GLW in my taxable account and used the money to buy more shares of CHI.  In my IRA account, I sold T and WFC and used the cash to purchase more shares of ZTR.  Both moves together lead to monthly payouts instead of the quarterly payouts I was getting from the individual stocks and lead to an overall increase in monthly cash flow of over 2.5%!

While I have nothing in particular against Etrade, I think it would have been better for Capital One to give their account holders a choice of brokerages to transfer their accounts to.  I'm leaning towards TD Ameritrade and would transfer my accounts now, however since I'm in the habit of re-investing dividends, I own a lot of fractional shares that I don't think I could transfer over.  Capital One plans to pay cash for fractional shares before transferring accounts to Etrade, so I guess I'll have to wait until that all plays out and transfer my accounts back to TD Ameritrade after they've gone over to Etrade.  Kind of a hassle, but I'm not seeing any other way to make the switch.  That's why I think Capital One should have offered more choices.  

WHAT I'VE LEARNED ABOUT GENERATIONAL WEALTH FROM AGATHA CHRISTIE

I never read Agatha Christie's books when I was young, but I happened across a collection of them at a thrift store last year and received another stack of her books for Christmas, so I've been enjoying reading many of her books and short stories since then.  While the books themselves are wonderfully well written and give a glimpse of the British lifestyle of her era, I noticed a recurring theme about the way the gentry viewed wealth and investing.  They didn't look at their investments as something to be sold to provide for them in their old age, rather they were viewed as a source of income.  In other words, they lived off the income their investments produced and passed the investments on to their heirs when they died.  Thus perpetuating generational wealth.  

That is the way I view dividend investing.  I have no intention of selling my investments when I retire and living off the proceeds.  I intend to live off the income they produce, or a portion of the income and leave the rest to my heirs, so the next generation benefits from all my hard work.  Think of what it could mean to a country's economy if all their citizens did the same.  In the book, "The Richest Man in Babylon", the king wanted the man with the most wealth to teach others how to create wealth in order to make his kingdom one of the richest in the world.  Imagine how much better off the world would be if everyone were taught the importance of saving and investing rather than becoming wage slaves, living paycheck to paycheck and dying broke.

Don't want to stray too far from the point.  I just found it fascinating that there was a time and place where people thought more about generational wealth.  While I hope to be around many more years, I'm excited about the prospect of leaving a meaningful inheritance to my family.  

APRIL 2018 TO SET NEW RECORD HIGH FOR DIVIDEND INCOME!

With April typically being one of the lower months for dividend income and after last month's near record high, I wasn't expecting to do quite so well this month.  However, I did a quick estimate today after posting dividend payments from PSEC and ZTR and April will set a new record for dividend income.  Not only will it beat out March 2018, it will be nearly double April 2017's income and will beat the all time highest month to date, December 2017, by more than 3%!

This leads me to believe all the recent trades I've made were a good thing.  Especially when you consider that income increases from some of the trades don't even kick in until next month.  Which means that this month's record may be short lived.  While May has only 41 dividends compared to April's 43, the amounts will be higher and I'll collect the last dividend from VZ.  If that doesn't break this month's record, June surely will with it's total of 46 dividend payments.

Read an article on AEG today which makes me wish I'd bought more shares around the $4 mark.  While my stake is up considerably, I have no plans on selling.  I originally bought the shares as a way of collecting back some of the fees charged on my 401k.  My 401k is run by TransAmerica which is owned by AEG.  So I bought the shares of AEG on the cheap with the idea of collecting the dividend to get back some of the money they charge for managing my 401k.  I also own a piece of AEG through JPS, one of my convertible securities funds.  After seeing how much AEG earns per share compared to what they pay out in dividends, I think it's well worth holding on to in it's own right.  Looks like it could turn out to be a very good long term investment, although I wish they paid dividends more than twice a year.

RECENT TRADES BOOST MONTHLY DIVIDEND INCOME BY 8%!

In my last post, I was excited about boosting monthly dividends by another 2%.  So I'm extremely elated about recent trades increasing monthly dividends by over 8%!  It gets even better, since the income from cash invested, from the stocks that I sold will go up by nearly 300%!  I sold my stakes in MRK and VZ and used the money to buy more shares of PSEC and ZTR respectively.  (Incidentally, I just collected a dividend from MRK this month and held on to VZ long enough to collect their dividend in May.  My trades should complete in time to collect my first dividend on the ZTR shares this month and PSEC in May.)   

I know what's being said about PSEC, but I find it hard to believe that one of their company insiders is willing to risk $204,000,000 of his own money unless he thinks something good is going to happen with the company.  O.K., I know with over 34,000,000 shares he's collecting over $2,000,000 per month in dividends, but that still isn't reason enough to invest so heavily unless you think the market is undervaluing the shares.  Another company insider owns over a million shares as well.  I could be wrong here and am by no means encouraging anyone to follow my move, but I'm willing to take on the risk to follow the insiders.

As for ZTR, a global dividend and income fund, I'm after the 12.37% yield there.  Since they're near their 52 week low, I'm willing to take the risk there as well.  Like I said earlier, I'm not encouraging anyone to follow my lead on these or any other investments.  My 401k is invested quite conservatively and I have conservative investments in my other investment accounts to help balance the risk on some of the higher yield plays.  We'll see how it all works out.

INCREASED MONTHLY DIVIDEND INCOME ANOTHER 2%!

Just boosted monthly income from dividends another 2% by selling OCSL, EAD and CCUR and reinvesting the cash in CHY!  The sale also resulted in nearly doubling dividend earnings from the cash invested in the former three stocks!  Needless to say, I'm pretty excited about the change even if it cost me a little money in commissions.  However, considering the performance of OCSL, EAD and CCUR, I think I'm much better off having gotten rid of them.  My trades should be completed in time for me to capture the dividend for CHY in April.  This brings my total number of dividend payments back down to 516 per year.

The month of March 2018 was up nearly 50% compared to March 2017 and tied for the all time high in monthly dividends with December of last year!  While the overall value of my investment accounts is down, monthly cash flow from dividends continue to increase quite nicely.  Really looking forward to all the new dividends kicking in next month.  I mentioned in my last post that I'll be focusing on reducing debt dramatically for the rest of this year, however I'll still be on the lookout for ways to free up cash and increase holdings whenever possible.

A co-worker has been asking me about stocks lately.  She wants to start investing but she's afraid of the markets erratic behavior of late.  I told her the best day to invest in the stock market is today.  If you wait, chances are you'll never start.  I gave her the ticker symbols of a couple of low volatility S&P 500 etf's paying monthly dividends and told her that would be a good place to start.  Once she gets her feet wet, she can move on to possibly some higher yield funds or individual stocks.        

PAYING OFF MY HIGHEST INTEREST DEBT IN HALF THE TIME!

After reviewing how much I pay in interest each month on my charge accounts, I decided it was imperative to my financial well being to pay off my debt at a faster pace.  So I'm diverting money earned on Swagbucks (see link in link exchange) towards paying off my highest interest debt.  I'm still making my regular monthly payment, but this month I was able to make two additional $25 payments with cash from Swagbucks.  While that may not sound like much, I used Credit Karma's credit card repayment calculator to determine how much I'd save.  Not only will I pay off this debt in half the time (15 months instead of 30 months)  but I will pay less than half the amount of interest!  

This is my highest interest charge account.  By the time it's paid off, my lowest interest account balance will have been paid down enough that the $170 freed up by paying off the high interest account will rapidly pay off the second account.  After the second account is paid, I'll have $210 extra per month to pay off the third account and then I'll have an extra $270 to rapidly pay down the two remaining accounts.  This is really nothing new, I think others have referred to it as the "credit snowball", but I've modified it by starting with the highest interest debt first, instead of the lowest debt.  I believe that I'll save more in interest that way.  It might take me a few years, but once I've paid off all my debt, I'll have freed up around $600 per month which can then be directed towards investments.

In the mean time, I'll still be reinvesting dividends and adding to my 401k each payday.  So it's not like I'm ignoring my investment accounts.  While I might not see the rapid gains I've seen in dividend income in the past few years, the money I save on interest will more than make up for that.  In the end, the earned income freed up from being debt free will allow me to build my investment portfolio at a much more rapid pace than I ever have before.  I'm pretty excited about the whole plan!  Wish me luck.

DIVIDEND INCOME UP 40% FOR FIRST QUARTER 2018 COMPARED TO 2017!

With the markets down and not having as much cash available to invest as I'd like, I've been kind of concerned that I'd not be able to grow dividend income as rapidly as I'd like.  While that's is still a concern, I was pleasantly surprised to see dividend income for the first  quarter of 2018 is up over 40% compared to first quarter 2017!  So, should I continue to grow monthly cash flow at this moderate pace, I'll still be collecting a nice tidy sum each month when I retire in four years.  If at all possible, I may even work an extra year to give the earnings time to compound even more.

I was not happy with CRF's proposal to issue new shares, so I sold my stakes in both CRF and CLM.  While I liked their high monthly dividend payments, the truth of the matter is, they were mostly just a return of capital.  The share price has suffered all along and even though I invest more for the cash produced, I don't want to own a stock that's constantly going down in value.  So I've moved on and invested the money in a bond fund (FTF) paying over 11% and a stock fund (ZTR) paying over 12%.  While that's less than the yields from CRF and CLM, these two funds have better performing share prices and have actually raised dividend payments in the past.  Even with rising interest rates, FTF being an intermediate term bond fund should do O.K. and the two of them together are much more conservative than CRF and CLM.   Not to mention their investment styles are much more less convoluted.

While I'm just as averse as anyone else at seeing the overall value of my portfolio drop, I have been pretty happy seeing a more rapid increase in monthly income from reinvested dividends.  With share prices lower, reinvested dividends purchase more shares and increase cash flow exponentially.  So I'm looking at it as a good thing, since I'm still in the accumulation phase.

WHY ARE DIVIDENDS SO LOW AND EXECUTIVE PAY SO HIGH?

As a dividend investor who actually reads the reports from the companies I own shares of, it's always bothered me that corporate executives as a whole seem to have such generous pay packages while shareholders receive such low dividend yields.  As of this writing, the average dividend yield of the S&P 500 is 1.76%.  Why is that?  If the companies can afford to pay their top people millions a year in salaries, bonuses and stock options, shouldn't they be able to pay their owners more than 1.76%?  They may say they're holding back cash and returning value to shareholders in other ways, such as stock repurchase plans.  However, the only good reason to be repurchasing shares of a company's stock is if the shares are undervalued.  This is not the case with a lot of companies involved in share repurchases.  So one has to wonder why they are repurchasing shares.  Is it to boost executive bonuses?  That would be my guess.

This is why I always vote against executive compensation packages.  As a shareholder, I believe executives should be rewarded for performance and I'm not talking about share valuations that are artificially inflated due to share repurchase programs which were not necessary.  Otherwise, I believe they should be rewarding their shareholders by paying a bigger dividend.  If they aren't doing so, then I see no good reason to increase their pay at the expense of the shareholders.  I invest to make more money for myself, not for greedy corporate executives.

INCREASED MONTHLY DIVIDEND INCOME OVER 3% WITH NO CASH OUT OF POCKET!

I'd been sitting on over a 300% gain on my shares of UVE for a few years now and with the recent run up in price, I decided it was time to sell.  I decided to invest the cash in CHY.  While I don't expect to see their share price increase like UVE, they pay a monthly dividend which amounts to more than 5 times what I earned from UVE!  It will also increase my total monthly cash flow from dividends by over 3%!  I collected UVE's latest dividend this month and I will start collecting dividends from my new position in CHY in April.  What I like most about the whole deal is I accomplished this with no money out of pocket.  All in all, I think it's a great move!

Now I just have to figure out how to repeat the process every month for the next 4 years or so.  Wish me luck.

DOUBLED DIVIDEND INCOME FROM GLAD!

Just used a portion of my tax refund to purchase more shares of GLAD, effectively doubling monthly dividend income.  Purchased shares in time to collect my first dividend on the new shares by the end of the month.  I decided to invest tax refund money in GLAD because they make more than enough earnings per share to cover their dividend of 7 cents per month and the price had dropped since my initial purchase.  Buying shares at the new lower price also reduced my average price per share and increased overall yield!

Kicked off the month of March 2018 with 11 great dividend payments on the first!  Still have 35 more dividends to collect, for a total of 46 for the month.  I'm currently reinvesting all dividends, with the goal of increasing monthly cash flow and total shares owned as rapidly as possible.  Don't have any plans to add any new stocks in the immediate future, but I'm always keeping my eyes open for a good deal.  I look at anywhere from 20 to 40 stocks per week, but I've gotten very picky about what I buy in to.  Still have some shares which haven't really panned out the way I expected, but they are still paying and I'm in no real hurry to replace them.

FEBRUARY DIVIDEND INCOME UP NEARLY 80% OVER FEBRUARY 2017!

Just finished comparing cash flow from dividends for the month of February 2018 to that of 2017 and am pleased to report nearly an 80% increase!  This is largely due to increased investments throughout 2017 and reinvested dividends along with dividend increases from some stocks.  Dividends for February also increased 4% over January of this year, even though I received one less dividend payment this month.  

AGNC and QYLD played a large part in increased monthly cash flows.  Just completed the purchase of more shares in AGNC, at the lower price, to reduce my average price per share.  May use my tax refund to add additional shares of QLYD, although it's not as easy for me to buy because of some odd rules my investment company has in regards to the purchase of their shares.  Not really sure why they do it, but I can only purchase shares of QYLD by placing a limit order.  However, it worked out very well with my initial purchase, so I'm not too concerned about doing it again.  I can always add more shares through reinvested dividends, which I did today with their first dividend payment.

Although the stock market can't seem to decide which way it wants to go, I'm not too concerned as long as monthly cash flow keeps growing.  As long as stock prices are down, I'll be able to add more income producing shares with available cash and reinvested dividends, so I wouldn't mind if it lagged for the rest of the year.

FIVE HUNDRED AND TWENTY DIVIDENDS PER YEAR IS ENOUGH.

I had planned on adding shares of EVV to my IRA account which would have added another 12 dividend payments per year to my portfolio.  However, after giving it some thought, I decided that 520 dividends per year is enough.  I'm going to concentrate more on building current positions instead.  With the recent down market, I've gotten a little help in that regard, since reinvested dividends buy more shares at the lower prices.

Had a little extra cash in savings, so I decided to put that to work by purchasing more shares of AGNC.  With their yield over 11%, I'll earn a lot more money per month than if I'd left it in the savings account.  I'm looking forward to putting my small tax refund to work as well.  I'm leaning towards buying more shares of NLY since the price has dropped from my initial purchase.  It would reduce my cost basis and increase overall yield, so I don't see how I could go wrong with that.  

This downturn in the market brought home the need for me to pay a bit more attention to reducing cost basis on all my investments where possible.  In the case of NLY, I'm investing more cash out of pocket, which will bring my average price per share down rapidly.  However, in most cases where I overpaid, I'm simply reinvesting dividends at the lower prices.  Each time a dividend is reinvested on stocks that have dropped in price, the average price per share goes down.  Reducing cost basis makes it much more likely you'll come out ahead when the market goes up again.  The other side of that coin is, where I bought stocks that were down and have seen a big increase in share price, the average price per share goes up with reinvested dividends.  In cases like these, I have to decide whether it's worth paying a higher price or whether I'd be better off to take the dividends in cash.  

USED LIMIT ORDER TO BUY QYLD AT LOWER PRICE!

With the stock market still trying to decide whether to go up or down, I took advantage of the volatility and used a limit order to purchase my stake in QYLD.  I set the purchase price lower than the quote price and the jittery market did the rest, letting me buy in at the lower price, then immediately going back up putting me in the black on the first day of purchase!  I may have to use limit orders more often.  I've known about them for quite some time but never took advantage of it.  Now that I've actually used it to my advantage, I can see where it could be quite useful for future stock purchases and sales.

Was also happy to see GLW increased it's dividend again this year.  This year's increase is up by 16% over their last quarterly dividend.  I've trade GLW several times in the past, always making a profit, but the stake I own now I've held for quite some time.  I'm taking more of a buy and hold approach this time around and it looks as though it will pay off in the long run as well.

Even though most of my holdings are trending up, my portfolio is still down considerably from a couple of weeks ago.  So I'm hoping to pick up bargain prices on more shares before they return to previous highs.  While I will be investing some cash out of pocket, I'll mostly be increasing number of shares held through reinvested dividends.  That's probably for the best, since there are no commissions on reinvested dividends.

Collected my first dividend from AGNC and am pleased to report it was a nice tidy sum!  Their high yield monthly dividend will provide a significant boost to monthly and annual dividend income.  The cash flow from AGNC, along with NLY, QYLD and EVV should help make 2018 a very good year!

Capital One has decided to turn over it's investment business to ETRADE later this year, so I'll have to get used to a new brokerage.  I can't imagine it is that much different from what I'm used to and ETRADE has a very good reputation.  I'm looking forward to the change.  It will be nice to be dealing with more of a mainstream brokerage.  Although I'm a little surprised Capital One, with all their resources, couldn't make a go of it.  Perhaps they decided it was better to stick to their mainstream business.

It was good to see how my portfolio weathered this latest storm.  While I did have paper losses on the value of my stocks, they were relatively minor and dividend income actually increased.  So I'd say my mix of investments are pretty well suited to handle an actual correction in the stock market if or when one should occur.

HOW MANY TIMES A YEAR DO YOU GET PAID?

I decided it was time to re-calculate the number of times per year I get paid.  With my latest stock purchases my dividend payments per year went up to 532!  I get paid from work 24 times per year (twice per month).  Then I collect interest payments 12 times per year on my bank accounts.  I also collect 24 payments per year from my little internet side gigs (Swagbucks and Bing).  So you add that all up and I'm collecting a whopping 592 payments per year!  

While I live on my income from work and it's still my largest source of income, dividend income increases every single month.  I may or may not get a raise from work this year, but I know I'll get at least 12 raises from my dividend stocks due to reinvested dividends.  All the negative Nancys always say, "Well eventually you'll have to start collecting the dividends in cash and it won't be going up anymore."  Yes that's partially true.  However, I have 4 separate investment accounts.  So I can draw the dividends in cash from one or two of those accounts and keep reinvesting and growing the income on the rest.  No matter how you look at it, getting paid 592 times per year is a very good thing!    

STOCK MARKET DROP NOT ALL BAD NEWS

Like the ice snow storm here in Missouri on Sunday, the past weeks' drop in the stock market kind of caught everyone off guard.  I have to admit, it surprised me as well.  However, instead of fretting over paper losses, I've been looking at the opportunity it presents.  As far as the economy, everything is still looking good going forward, so I'm looking at this as a chance to pick up more shares at much cheaper prices.  Lower stock prices mean it's now cheaper to buy a dollar's worth of dividends than when prices were up.  It allows me to increase dividend income much more rapidly than I had expected, since I'm not paying as much to purchase additional shares of stock.

On that note, just completed my purchase of QYLD in time to capture the dividend for February.  Also timed the sale of PFE so I could make a small profit and collect a final dividend from them later this month.  The monthly dividends I collect from QYLD will be about 3 times as much as I was receiving from ORA and PFE, plus it allows me to get involved in trading covered calls much sooner than I would have otherwise.  Although, they'll be doing the trading for me, it's the idea of creating an income stream from options trading that appeals to me.  I still plan on trading covered calls on my own as soon as the funds become available.

Don't have any idea how long this drop in the stock market will last, it seems to be at least partially fueled by limit orders kicking in and activating trades, driving prices down.  In any case, I'll be buying everything I can afford to boost my overall portfolio yield while the fire sale is on.

FEBRUARY KICKS OFF WITH 11 DIVIDEND PAYMENTS!

The month of February started off great with 11 dividend payments, including my first dividend from JPS!  Since stock prices are still down and most of my dividend payments were invested in more stock, I was able to pick up some shares for less.  Also have a couple stocks in my taxable account paying out cash, so the cash balance in my savings account jumped by 10%!  How's that for a great first day of the month?

Going forward, even though February is a short month, I'll collect a total of 41 dividends this month.  With 11 today, I'm looking forward to another 30 payments before the end of the month!  Should get all my tax documents in by the 15th so I'll be able to prepare my income taxes.  I'm going to invest my refund in shares of EVV for my IRA account.  Right now they're selling at a discount to net asset value and they're quite near their 52 week low.  With monthly dividends and over a 7% yield, I think it will be a good place to park my tax refund this year.

JANUARY DIVIDENDS UP 33% OVER 2017!

Collected a whopping 14 dividend payments on the last day of January 2018!  Compared to January of last year, dividend income for the month is up by over 33%!  While that's not as much of an increase as I've seen in past years, it's still pretty amazing.  Looking forward to a big jump in year over year earnings in February as well, with the first dividend payment from AGNC.  This monthly dividend payer alone will increase total cash flow by over 5% per month!  

Looks as though the stock market is reacting favorably to Trump's state of the Union address.  I'm seeing nice increases in share prices on the majority of the stocks I hold.  Whether or not anything the President says or does helps the stock market, I think we're going to see an overall increase in the market again this year.  Whatever happens, I'm confident I'll see a big increase in monthly cash flow from dividends by the end of 2018.

I've decided to sell my stakes in ORA and PFE for a small gain on both and reinvest the cash in QYLD.  This will significantly boost monthly dividend income and I'll still be invested in ORA and PFE through some of my other fund holdings.  My intention when I bought the shares was to hold them for capital gains and collect the dividends along the way.  While my gains on both stocks after commissions is only a little over 10%, I'm satisfied with that and looking forward to increasing monthly income and getting involved with covered call trading through QYLD.  I'll hold off on the sale of PFE just long enough to collect their next dividend payment, which still gives me time to buy QYLD and collect a dividend from them in February.    

CHASING CAPITAL GAINS CAN LEAVE YOU EMPTY HANDED

I mentioned in my last post how much more I prefer to pursue dividends as opposed to capital gains.  Like I said before, I enjoy capital gains as much as anybody, but I also know how easily they can quickly disappear.  The drop in the stock market this week provides ample proof of what I was saying. The drop in share prices over the past two days has dramatically impacted the overall value of my portfolio.  However, even if the market shows a loss for the month, my dividend income will increase!  Had I only been invested for growth, i.e. capital gains, I would have been sorely disappointed.  Since my investment objective is increasing dividend income every month, I'm actually quite excited.  With the stock prices being down, my big dividend days at the end of the month and the first of next month, will buy more shares than they would have had prices remained the same or went up.  So I'll make a bigger gain in monthly dividend income than I had expected.  I'm pretty happy about that.

I've bought and sold a lot of stocks over the past 25 years.  Some I made a lot of profit on, some I lost money on, that's the way it works.  I still buy some stocks with the intention of trading for capital gains, but I only buy stocks paying dividends, so if the price should go down instead of up, I'll still collect some cash on a regular basis.  

As a reminder of how fleeting capital gains can be, I own 1,000 shares of stock in my taxable account that I bought on a tip from my sister's boss.  It seemed very promising at the time.  Didn't pay a dividend, but it looked as though they were really going places.  I'm not sure exactly where they went, but it wasn't where I expected.  My 1,000 shares is currently worth 10 cents.  Which is exactly why I say chasing capital gains can leave you empty handed. 

CAPITAL GAINS VERSUS DIVIDENDS

In an earlier post, I mentioned my interest in getting involved in trading options in the form of covered calls.  While I don't have the cash available to do this at the present time, I've discovered there are funds specializing in selling covered calls to generate income for shareholders.  I read an article today comparing an ETF I'm interested in buying in to with a CEF.  The author made the case that it would be foolish to go with the un-managed ETF when the "professionally" managed CEF more closely tracked the performance of the covered call market, generating more capital gains for its' shareholders.

Well here's my take on that.  As someone who's invested through lots of market ups and downs, I see very little advantage to favoring an investment for potential capital gains.  Capital gains can only be collected if you sell some or all of your shares, otherwise they're just paper profits.  On the other hand, dividends can be collected as cash payments from the get go, either buying more shares or to use however you see fit.  Since the closed end fund's (CEF) fees were extremely higher than the exchange traded fund (ETF) I'm interested in and the dividend yield is 3% higher, I think it would be better to save on fees and take more cash up front.  Anyone who has invested for any length of time realizes how quickly share price gains can evaporate in a down market, but while dividends might be reduced, it's a lot less likely they'll be discontinued altogether.  When I read this article, I couldn't help but wonder why someone would encourage you to pay more in fees and just hope for the market price to continue to rise.  I'll be buying into the ETF instead and collecting a nice monthly dividend, which by the way had also increased in price.

As far as I'm concerned, if it's a choice of investing for capital gains or dividends, I'm always going to go for the dividends.  Capital gains tend to follow stocks paying reliable dividends, so whatever I earn from higher share prices is just icing on the cake. 

SELLING BLW, BUYING AGNC FOR AN 82% BOOST IN MONTHLY DIVIDENDS!

I was less than enamored of BLW to begin with and wasn't excited by anything I read in their latest report.  So I decided it was time to part with the fund and will replace it in my IRA account with AGNC.  Both pay monthly dividends, but by reinvesting the cash in AGNC I will boost monthly dividend income from dollars invested by a whopping 82%!  I'm not just chasing after yield here, since I believe that AGNC's share price will also outperform my previous stake in BLW.  This trade will also boost overall monthly dividend income by around 2%.  While that may not sound too exciting, all those little percentage increases add up.

Still tossing around ideas to come up with some extra cash to start trading covered calls.  Haven't quite decided how I'm going to do that yet, but I'll think of something before the year is over.  

GGT BECOMES A "FREE STOCK"

I've written about my strategy of "free stocks" in the past.  What I mean by "free stock" is any stock I no longer have cash out of pocket invested in.  GGT has become my latest free stock.  The way I accomplish this is by buying a stock, reinvesting the dividends and holding on until dividends and capital gains allow me to sell enough shares to get my original cash investment back, while still keeping a small position in the stock.  Stocks in my current portfolio that meet this criteria include UVE, HWBK and now GGT.  Selling shares and taking out my original investment allows me to reinvest the cash elsewhere, while still collecting dividend income on the free stocks.

My original cash investment in GGT will now be invested in monthly dividend payer GLAD.  While the dividend yield on GLAD of 8.96% is a little less than the yield on GGT, I prefer the monthly income and I believe there is more upside potential on the share price with GLAD.  I took advantage of UVE's recent run up in price to sell a few shares and free up cash to purchase a stake in JPS.  Both purchases are scheduled for next Tuesday and I should collect my first dividend from each in February.  This will bring my total number of dividend payments collected per year up to 516!

I've been doing a lot of research on covered calls.  While I used to find options trading quite confusing, I'm beginning to see that it's not quite as difficult as I once thought.  I'm especially interested in covered calls for the income they're potential income and for their relative safety.  Got more research to do, but I expect to be writing my first covered call before the end of 2018.