MY NEXT TWO STOCKS FOR MY IRA ACCOUNT

I revised my automatic stock purchase plan for my IRA account to purchase my next two dividend stocks.  The newest additions to my IRA will be Eli Lilly (LLY) and Pfizer Inc. (PFE).  Both are well known corporate brands with great dividend yields and have a long history of paying dividends.  I believe that both companies will be around for years to come and will make good additions to my investment portfolio.  The purchase of shares in these two stocks will add a total of 8 dividend payments per year towards my goal of 365 days of dividends. 

DAILY DIVIDENDS: WEEK IN REVIEW

I'm happy to report some great progress this week towards my goal of 365 dividend payments per year.  With this weeks' stock purchases, I was able to add a total of 16 dividend payments per year, bringing my total to 172 dividends.  So I'm covered for 172 days of the year, leaving me 193 dividend payments to go.  Not to bad, I'll soon reach the halfway mark, so I'm ahead of schedule, compared to the amount of time I originally expected to take.  I'll be reinvesting all dividends until I've acquired stock in enough companies to provide a dividend payment for every day of the year.  That being said, the more dividend payments coming in, the faster the purchase process, so I'll be acquiring stock at an ever accelerating pace.  Once I've reached 365 payments per year, the dividend income will be redirected towards increasing stakes in each of my positions to increase daily payments.  It's all about cash flow and where you direct the money.

It was also a very good week for dividends.  This week I collected dividends from MO, O and WIN in my taxable account and PM and KFT in my IRA account.  So I collected a dividend for 5 out of 7 days of the week, helping to build cash balances in my accounts for my next investment purchases.  The more I think about this plan, the more excited I get about it.  But the greatest motivator is seeing the cash balances replenishing themselves with each dividend payment.  I'm looking forward to reporting future progress, which I'll try to do on a weekly basis.

LATEST ADDITIONS TO MY IRA ACCOUNT

Finalized my purchases of AWF and ERF for my IRA account today.  Locked in an 8.11% dividend yield on AWF which should start paying monthly dividends to my account in May.  With the small price drop since my last post, was able to get a final dividend yield of 10.97% on my shares of ERF.  The completion of these purchases add a total of 16 payments a year to my "dividend a day" plan. 

Since AWF is a high yield global bond fund, it also means I'll be investing in bonds for the first time.  While I'm a firm believer that stocks outperform bonds over the long haul, I figure at my age it doesn't hurt to have some exposure to bonds and a small amount invested in a fund like AWF has little change of adversely affecting my portfolio in any way.  I definitely like their monthly payments :0). 

MARKET SELL OFF GOOD FOR MY STOCK PURCHASE PLAN

The news media is buzzing with doom and gloom over today's drop in the stock market.  More European woes, a bad auction for Spanish debt, ADP reporting less new jobs, the Fed bowing out of another round of quantitative easing, it all sounds like too much for the market to handle. 

However, this works out great for me!  I'm making at least 4 new stock purchases this month.  I've decided to put off my purchase of CLX, for my IRA account, in favor of a couple of high yield issues, one paying monthly dividends.  I'm also planning to add two high yield stocks to my taxable account, one quarterly payer and one monthly payer.  The drop in stock prices couldn't have come at a better time for me.  With the completion of the above purchases I will boost my number of dividend payments by 32 per year (12 x 2 + 2x4).  I'm currently receiving 136 dividend payments per year.  Adding 32 more payments with this month's purchases will give me a total of 168 dividends, meaning I'll only have to get an additional 197 payments to reach a dividend for each day of the year.  This may sound like a lot, but it would only take 16 more monthly dividend payers plus 2 quarterly paying stocks to exceed my goal.  

All this will be a lot easier if the stock market prices are down.  So rather than doom and gloom, I'm excited about a pullback in stock prices.  Once my dividend a day cash machine is in place, I'll be looking forward to a rebound. 

DAILY DIVIDEND PORTFOLIO FLEXIBILITY

It occurred to me that an investment plan purchasing 92 quarterly paying dividend stocks, in order to collect a dividend for every day of the year, may seem to have little flexibility, as far as investment schemes go.  The strategy requires a buy and hold aspect, since you have to hold on to shares of all 92 stocks to collect a dividend per day for each day of the year.  However, since I'll be collecting dividends in an interest bearing account it does allow for fantastic buying flexibility.

When you have money coming in on a daily basis, cash balances rise quite rapidly, depending on how you manage the cash.  While I plan to build positions to increase cash flows by reinvesting dividends, I have the option to choose when to do my buying.  As everyone knows, it's impossible to time the market.  It is, however, much easier to identify buying opportunities.  When the market declines 10 percent from a previous high it represents a buying opportunity, as does each additional 10 percent decline.  Usually a person following this strategy would also identify selling opportunities by raising cash through stock sales when the market rises 25 percent or more. 

Since my daily dividend portfolio follows more of a buy and hold strategy, I would have less flexibility on the sales end, but this is where the daily dividends help pick up the slack.  While I mostly intend to buy and hold, it will become necessary at times to replace under performing stocks or stocks that may cease to pay dividends, so I still have to work out a strategy to account for such contingencies.  I'm open to suggestions on this one?

CURRENT YEAR AND LONG TERM INVESTMENT PLAN 2012: DAILY DIVIDENDS

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?