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.

THIS WEEK'S DIVIDENDS

The first full week of April proved to be good for dividend payments.  Between my IRA and my taxable account I collected dividends from Westar Energy (WR), Universal Insurance (UVE), Reynolds American (RAI) and Telstra (TLSYY).  I received 5 payments from the 4 stocks since I hold shares of UVE in both accounts.

The money from dividends will help pay for this months stock purchases.  For my taxable account I'll be purchasing a stake in Aberdeen Chile Fund (CH) with a dividend yield of 10.37%.  I also plan to purchase shares in Ship Finance International (SFL) with a current yield of 8.12%.  April's purchases for my IRA account will include AllianceBernstein Global High Income bond fund (AWF) yielding 8.05% and Enerplus Corp (ERF) with a current dividend yield of 10.47%.  The goal of this month's purchases is to raise total average yield on investments in both accounts and to increase total number of dividend payments by 32 payments per year.  Two of this month's purchases pay monthly dividends while the other 2 pay quarterly.  This serves a two fold purpose, increasing monthly cash flows and giving me a jump start on reaching my goal of 365 dividend payments per year.

This will bring my total number of payments per year to 168.  Only 197 dividends to go! 

SLOW WEEK FOR DIVIDENDS

O.K., so maybe it was just a slow week for me, but I did get a decent dividend from BGC Partners Inc. (BGCP).  While one dividend per week is a far cry from my goal of daily dividends, I'm making progress.  I made a list of stocks I'd like to own, with current dividend yields and the months they pay their dividends.  I'm working my way through the list until I own positions in 92 different stocks or at least enough stocks to pay 365 dividends per year.  What I realized when reviewing my current holdings is I already own some stocks that pay once or twice per year, instead of quarterly and a couple of issues that pay monthly.  So I may be able to get to 365 dividends a year with a lot less than 92 stocks. 

While this month has been slow for dividends, I added an additional 8 payments per year with the purchase of EXC and NU.  In the month of April I'll be adding at least 8 more payment by adding CLX to my IRA account and CH to my taxable account.  While doing spring cleaning I realized I have a lot of stuff I no longer use, so I'm taking it all to my sister's next yard sale and plan to use whatever money I make to buy additional shares of stock.  So it's possible I could add an additional 16 dividends for a total of 32 new annual payments by the end of April.

One thing I've learned from all my years of investing, it's important to have a plan and stick to it.  What kind of plan do you need?  Whatever works for you.  The most important thing is to stick to your plan and make adjustments where needed along the way. 

STOCKS, DIVIDENDS AND COUPON SAVINGS

It was a slow week for dividends, only collected one payment for the week from Great Plains Energy (GXP).  While it was only one dividend payment, it was a decent one, since GXP is one of my long term holdings and I own a good number of shares.  Stocks trended lower this week from their recent highs, but I look at it as a good thing, especially since I've got a purchase order in for next week.  I'm hoping the prices stay down a little longer until my order goes through.  Market timing is not a part of my long term investment plan, but if I can buy on the dips, it couldn't hurt.

Had a great week of savings on groceries.  I'm working on improving my extreme couponing and it's really been paying off.  Through coupon match ups with store sales, I was able to save 54% on my trip to Gerbes this week, which included three 2-liter Diet Pepsis for free!  Matching coupons with store sales at Schnucks I saved over 67% on my purchases.  On this trip I got two packages of Barilla pasta entirely free and paid only 17 cents each for Nissin Big Cup soups!  I also got Minute Rice, which normally sells for $2.38 a box, for just 79 cents each!  Since I like rice, and Minute Rice is my favorite, I stocked up on those.  I'll pick up some good deals on personal care items tomorrow at Walgreens and use their register rewards to purchase my favorite Stouffers entrees which they have on sale in this Sunday's ad.  I think what I like most about coupons is, they allow me to do the majority of my shopping outside the big box retailers.      

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?

MY NEW INVESTMENT PLAN BEGINS PAYING OFF!

Collected some of my first dividend payments from stocks purchased for my new investment plan.  This weeks' payments included dividends from Duke Energy (DUK), Solutia (SOA) and Realty Income Corp (O). 

While Solutia is by far my longest held stock, they just recently started paying dividends again.  I held this stock through bankruptcy and have patiently waited to see if they would make any progress.  So I'm really glad to see a little income from them once again.

Duke is one of my recent purchases as part of my Daily Dividend Investment Plan.  That's part of the beauty of the plan.  While I'm accumulating shares in a total of 92 dividend stocks so I can collect a dividend for every day of the year, I'll see cash flow increasing every month as I start collecting payments from my newest purchases.  Talk about positive motivation!

Realty Income Corp is a REIT which pays monthly dividends.  While I wouldn't go overboard with REITs or MLPs, they do have a place in income portfolios.  Both REITs and MLPs are attractive to dividend investors for their high yields, however along with high yields come high risks.  So investors should keep that in mind and do their homework before investing.

One thing I want to stress, anything I write in concerning my personal investments or investment plan, should not be construed as a recommendation for others.  If you get some ideas to apply to your own investment plan, I'm glad I could help.  If you have ideas you'd like to share, I'm all ears.  Never get tired of talking about investing and learning new ways to make money :0).

Have a great weekend!

GETTING ORGANIZED FOR MY BIG INVESTMENT PROJECT

In order to focus my attention on my 2 year portfolio building project, I spent the weekend getting organized at home.  Got caught up on all my yard work, cleaned and organized my apartment.  Had to get my old bedroom cleaned up and dried out for the painters.  My landlord finally got the roof fixed and they plan on repairing my apartment first.  I thought it would speed things up a bit, not to mention making things more comfortable for myself, to get everything ready so they can come in and get the job done as quickly as possible.

It's been quite an ordeal, dealing with the water leaks and mold for the past 6 months or so, but they're finally making some progress.  I've taken advantage of the time to decide what I could live without.  I figure I'll kill two birds with one stone.  I'll clear up room in my apartment and make some money by selling all the things I no longer want or need at my sister's next yard sale.  Whatever money I make from the sale I'll put to work in my investment plan.  Rather than having a lot of things collecting dust, I'll add shares of stocks to my investment account and collect dividends.

The restaurant where I work gave me a couple of Coca Cola clocks I intend to put in the sale.  I would have been happy making a few bucks, since they cost me nothing, but I've found out they're actually quite valuable.  If I sell them at the rummage sale I won't make as much as selling them on Ebay, but I should still do all right.  Whatever I make off them is pure profit. 

As soon as they repaint my old bedroom, I plan on making it my new home office.  I'm keep my bedroom on the north side of the building where it's more shaded during the hot summer months.  I have most of the furnishings, so I just need to pick up a writing desk and another filing cabinet.  I know a place near here where I should be able to get a good deal on used office furniture and should be able to get any office supplies I need with register rewards from Walgreens.  

It will be nice to get everything back to normal and get busy building my new investment portfolio and pursuing some of my other small business ideas.  2012 is beginning to look like a good year for me, we'll see how it goes. 

INVESTMENT PLAN 2012 UPDATE

I'm excited about my new investment plan for 2012.  If you haven't read my earlier posts, in a nutshell, I plan on purchasing shares in 50 additional dividend stocks paying quarterly dividends, with the goal of earning a dividend payment for every day of the year.

This week I received dividends from Advance America Cash Advance (AEA) and Centerpoint Energy (CNP).  I also deposited cash in my taxable account and my IRA.  I've put in orders to purchase the next 2 stocks for my accounts:  Exelon Corp. (EXC) for my taxable account and Clorox (CLX) for my IRA.  I figure it will take me 2 to 3 years to accumulate shares in 50 stocks, although that may be accelerated with the additional dividends I'll be picking up along the way.  Also, with the economy improving at a slight pace, it's possible I may find a better paying job during this time which will allow me to speed up the process.

I know most "experts" would advise against this, however I've never really had a great deal of luck following the "experts" advice, so I'm going with my own instincts on this one.  There have been times during my investment career when I've held shares in as many as 50 dividend stocks and I was amazed at how quickly those dividend payments added up.  With this plan, I will own nearly shares in almost twice as many stocks!  The rate of compounding on my investments will increase dramatically.  When I've reached my goal of 92 stocks, all the dividends payments will be used to build my positions, constantly increasing payouts.  If some of the companies should falter, I plan on replacing them with shares in other companies. 

If all goes well, when I retire I plan to draw only the dividend payments minus 10% which I'll reinvest to account for inflation.  Kind of an ultimate buy and hold strategy.  

WEEKLY COUPONS SAVINGS!

I put my coupons to good use this week and racked up some major savings!  Earlier in the week, I saved 53% off my grocery shopping at Gerbes.  Picked additional grocery items today and with only 2 coupons, still managed to score 27% off my purchases. 

Made out even better today at Walgreens.  On my first transaction I saved 27%, which is not great but not bad either.  On the second transaction, I bought 2 11.3 oz Folgers Classic Roast coffee, 4 Lays Stax potato chips 5.75 oz and one Oscar Mayer deli sliced ham 9 oz, for a grand total of $1.02.  For the first transaction, I matched coupons with sale items which also had register rewards.   I used the register rewards from the first transaction to pay for my second transaction, leaving me a balance due of $1.02.  Picked up their latest store coupon book while I was there and am looking forward to more great savings later in the month.

The money I save using coupons and the money I make from advertising on my blog and my Amazon store are all going toward my new investment plan.  I made a list of 60 dividend stocks I intend to purchase positions in over the next 2 to 3 years bringing my total annual dividend payments to at least one dividend per day.  It might sound overly ambitious, but I don't believe there is anything a person can't do, they simply have to figure out how they're going to do it.  Talk about cash flow, a dividend payment every day of the year sounds like ultimate cash flow to me :0).

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?

BUYING A STAKE IN NORTHEAST UTILITIES

Just transferred the money to my taxable brokerage account to purchase shares of Northeast Utilities (NYSE: NU).  They are the parent company of Northeast Utilities System.  Northeast Utilities System furnishes retail electric service through wholly owned subsidiaries to Connecticut, New Hampshire and western Massachusetts.

Their dividend yield, on recent price of $36.10 per share, was 3.25%, which represents a dividend of $1.18 per share.  I placed the order to purchase shares before the end of February, to take advantage of their next scheduled dividend payment on March 30, 2012.  Payments are made to shareholders of record as of March 1, 2012. 

KEEP GETTING PAID FROM EVERY JOB YOU EVER HAVE

Yesterday I stopped at a convenience store to get gas and ran in to a girl I worked with about 5 years ago.  She's still at the same job and was telling me how much better things are there with the new managers.  After I left, I thought perhaps I should go talk to them about getting my old job back.  However, it also occurred to me that I'm still getting paid from my time working there.  In fact, I am not only getting paid from that job, I also get money every month from the job that followed that one and the unemployment I received before starting my current job.  If or when I decide to move on from my current job, I'll continue to get paid from them as well.  How is this possible?  By setting aside a small amount of my earnings each month and investing it in dividend stocks. 

If I had only known when I was younger what I know now, I'd be getting paid from every job I've ever had and would most likely be retired right now.  It doesn't take a great deal.  When I first started my investment program, I was only able to save $35 per month.  Yet I managed to accumulate a nice tidy portfolio over the years and anyone can do the same.  Sharebuilder.com will allow you to open an account and set aside small amounts to purchase shares of dividend stocks.  When you've purchased your initial shares you can easily re-invest dividends and start building your own portfolio.  Even if you only saved $20 per month, you'd have $240 by the end of the year.  Not a fortune, but enough to purchase dividend paying shares and start building your own cash machine that will pay you month after month, year after year. 

So my best advice to young people is;  Make it your goal to get paid for the rest of your life from every job you ever have.  No matter how much you're able to save, put a small portion aside and invest in dividend paying stocks.  Re-invest your dividends to build your cash flow and never spend your initial investment.  By doing so, you will continue getting paid in the form of dividends from every job you ever have.

PAYMENTS FROM UTILITY PORTFOLIO

Not long ago I wrote about adding utilities to my portfolio.  I've owned shares of CNP and Great Plains Energy for quite some time now.  However, with a goal towards increasing monthly cash flows and evening out monthly dividend payments, I decided to beef up my portfolio with high quality utility stocks. I've added Duke Energy (DUK), Wisconsin Energy (WEC) and Northeast Utilities.  With the dividend payment from Northeast (NU) in the month of March, I will have received payments from all three investments.  With these investments paying off each quarter, my next move will be to add shares in 3 additional utility companies paying in different quarters.  This will boost monthly dividends paid to my portfolio for each month of the year.  In the end I'll be collecting the same number of dividend payments each month.  Then it's really just a matter of boosting my holdings through dividend re investments and additional cash contributions to reach the ultimate goal of replacing my monthly from work.

As long as my health holds out, I plan to work at least another 10 years, so I've got quite a bit of time to build on my investments.  I'm already seeing the benefits of monthly income from dividends by the additional freedoms this allows.  I no longer have to work as much as I used to, or make as much from my job, to maintain my lifestyle.  Probably the best benefit of all is not worrying so much about money,  since I know that even when big expenses arise unexpectedly, the cash machine I've created from dividend stocks will eventually put me back in the black.

FEBRUARY OFF TO A GOOD START

The month of February is off to a good start for me.  With the stock market up and coupon savings at the grocery start of 47% this week, it's looking like a good month money wise.  I've been getting all my information together to file my tax returns and expect a modest refund.  The problems I've been having with my landlord regarding damages caused by a roof leak are nearing a resolution, so I should getting my apartment repaired soon and get things back to normal there too. 

I've had a lot of turmoil in my workplace related to turnover of employees and an upcoming corporate review.  While I don't deal as well as I should with changes in the workplace, I realize that fact and have resolved myself to roll with the punches, so to speak, and keep in mind that change can bring new opportunities.  So I'm concentrating on keeping myself open to new opportunity and keeping a positive outlook.  Ultimately I'm thankful to have a job at all when so many people are out of work.  Currently my working income represents the majority share of my monthly cash flow, so until my investment income overtakes that, I need to concentrate on keeping my employers happy.

I'm continuing work on my investment plan for the year and am considering opening a Roth IRA.  While contributions are not tax deductible, I like the idea of not being taxed on profits.  With contributions to my regular IRA making up only a small percentage of deductions to my taxes, I'm thinking that I would benefit more from future tax savings offered by a Roth account. 

Got some great coupons in the mail from Gerbes this week.  The mailers they send out are based on past purchases, so the coupons are for items I regularly purchase.  Some are entirely free and free is the ultimate goal of coupon shopping.  I'll be making good use of those along with the coupons I received from last weeks paper and register rewards from Walgreens.  All the money I save from couponing contributes toward building my investment portfolio and increasing monthly dividends.

MY INVESTMENT STRATEGY FOR 2012

After taking in to consideration the state of the U.S. and world economy I've decided to keep things simple for the first part of 2012 and invest in utilities.  I've written in earlier posts my reasons for believing utility companies will do well for the next few years, so I've picked out what I believe to be some of the best of the best to beef up the utility section of my portfolio and increase monthly cash flows.  Increasing monthly cash flow while keeping risk at a minimum is my biggest investment goal for the year. 

I'm still working on rebuilding my investment portfolio after the big payouts on health care from my heart attack.  Of course I still have the expense of ongoing care, with no insurance, but I've managed to keep expenses to a manageable level so far.  Things should be even easier as more of my old debts are paid off this year.  I should be entirely debt free by the end of 2012, which frees up money spent on debt for building my dividend stock portfolio.  I have already doubled my monthly cash investment and will continue to increase contributions as bills are paid off.

So the simple overall plan is pay off debt and buy utilities for 2012.  May not be the best of plans, but I'm sure I could do a lot worse. 

QUOTE OF THE DAY

"Now I will tell a strange truth, the reason for which I know not.  When I ceased to pay out more than nine-tenths of my earnings, I managed to get along just as well.  I was not shorter than before.  Also, ere long, did coins come to me more easily than before.   Surely it is a law of the Gods that unto him who keepeth and spendeth not a certain part of all his earnings, shall gold come more easily.  Likewise, him whose purse is empty does gold avoid."-- From "The Richest Man in Babylon" by George S. Clason

TIME TO REVIEW INVESTMENT PLAN

Started the new year off right with dividends from Westar Energy (WR), Glaxo Smith Klein (GSK) and Reynolds American International (RAI).  There is a lot of uncertainty going into earnings season with efforts to shore up the Euro, so not really sure where the market is headed.  The jobs report gave us a little boost, but I wouldn't count on that to last long. 

January is the month I usually review my investment plan and make any revisions I think necessary.  Also working on getting all my tax paperwork together to file my income taxes.  Will probably get a small refund this year, which I plan to invest solely in my taxable account to build monthly cash flow.  I invest in my taxable account and my IRA every month but I look forward to these small windfalls from tax refunds to give my portfolio a boost.

WEEK IN REVIEW...

I guess we can forget about the "Santa Rally" I talked about in my last post.  We had kind of a rollercoaster ride this week, up then down then back up, ending mostly flat for the week. 

I collected dividends from Centerpoint Energy (which I reinvested in more shares) and Realty Income Corp.  Otherwise not much activity in my personal accounts.

My MBCI store has generated some commissions for the month.  I've added a Garmin section and have been researching new items to add to the store.  Need to work on promotions to increase my commissions.  It would be nice to build up a steady stream of affiliate income.  Got to spend more time on that.

WILL WE SEE A "SANTA RALLY" THIS DECEMBER?

Some thought the gains we saw earlier in the week were the beginnings of a "Santa Rally."  However, with today's market stall, I believe it's unlikely.  I think people are jumping on any good news, or at least no bad news.  We all want to see the economy and the stock market revive, but I still don't think that will happen without significant improvement on the jobs front.  That being said, if we get a little good news and avoid any major economic issues, we may still see a rally by the end of the year.  I don't think it will last much past January.  I still believe the best bet is good dividend yields for the foreseeable future.  

From my own investment accounts I collected some nice dividend payments today from ConAgra, Aflac and Intel.  I believe all 3 have good long term prospects and I plan on holding/increasing my positions as part of my core portfolio.  I'll be reviewing my investment strategy and tweeking my financial plan for 2012.  While my current investment plan is working out well, there's always room for improvement.   

POWER UP YOUR DIVIDENDS WITH A 3 STOCK UTILITY PORTFOLIO

Last month I posted about utilities and the possibility of their benefiting from low interest rates for the next year or so.  Then it occurred to me that if you had only enough money to invest in a few stocks, you could do a lot worse than investing in a few good utility companies.

For instance, if you're goal were to receive monthly dividend payments, by purchasing shares in 3 different utilities paying dividends in different quarters, you could create just such a portfolio. 

As an example:

1.  MDU Resources Group (MDU) 3.1% dividend yield, pays dividends in January, April, July and October.

2.  NSTAR (NST)  3.7% dividend yield, pays dividends in February, May, August and November.

3.  Wisconsin Energy (WEC)  3.3% dividend yield, pays dividends in March, June, September and December.

All the above stocks have 5 year estimated dividend growth rates of 5 to 7%, meaning that dividend payouts should increase nicely over the next few years.  This is just an example, you'd want to do your own research and choose your own stocks, but the idea would work with any three stocks paying in different quarters.