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.

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. 

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?

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).

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. 

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.   

WEEK IN REVIEW

We had a nice week overall although stocks ended lower on Friday on European financial woes.  As for my own investments, picked up more shares of BMY and T through dividend re investments.  Also made an extra cash deposit to my taxable account from money earned through my part time carpet cleaning business.  I've earned enough to pay for the equipment, so I'm investing half of my earnings in dividend stocks to create additional monthly cash flow.

Did my grocery shopping after work today.  Picked up a everything I needed for the week and saved a little more than 30% off with coupons and sale match ups.  Looking forward to my weekly Walgreens trip on Sunday for more great deals!

UPDATING MY PORTFOLIO

Recently I made some changes in my IRA account.  I sold my stake in Astrazeneca (AZN) and used the proceeds to purchase shares of Deere & Company (DE), Westar Energy (WR) and added more shares of Great Plains Energy (GXP).  AZN's prospects for increasing earnings per share looked kind of bleak, so the prospects of continued dividend growth seemed kind of slim.  So I sold the shares while I was showing an overall profit and reinvested the money with the above named companies who's earnings and dividends are more likely to increase over the next 5 years.  These companies are dividend plays with some potential for growth and are all part of my long-term holdings in my retirement account.

As for my taxable investment account, I plan to purchase shares of Duke Energy (DUK), Northeast Utilities (NU) and Wisconsin Energy (WEC) as funds become available.  Right now I'm a little short on cash due to ongoing medical bills related to my heart attacks last year.  So my cash contributions to this account have been quite small, although I do contribute additional funds on a monthly basis.  The money available for new stock purchases is coming mostly from dividend payments, so there's been less activity in this account than in my IRA.  After Friday's run up in the stock market they're both doing quite well.  If the economy picks up after the first of next year, as I expect, then I should see some nice gains on shares purchased during the downturn in both accounts.

I recently received an investment newsletter in which the author was promoting an investment strategy quite similar to my own.  In the article she pointed out how her portfolio of dividend stocks was paying out a monthly payment from $1,100 to $1,500 per month after only 5 years.  Of course she had a total of around $200,000 invested.  Way more than I have now, but the principle is the same.  My dividend payments go up every month from the dividends I reinvest from the previous months and from additional cash contributions on my part.  It's really only a matter of time before my own portfolio of dividend stocks are paying as much or more than I will receive in Social Security each month upon retirement.  It's a simple matter of having a plan and sticking with it.

NEW MONTH, NEW LOWS FOR THE STOCK MARKET

The month of October started out on the downside for the stock market Monday and given the performance in the Asian markets overnight, I think we'll see more of the same today.  My accounts started the month off with a nice dividend payment from Reynolds American (RAI:NYSE).  Their current dividend yield is 5.67% with an annualized dividend of $2.12 per share.  RAI is one of my long term investments.

Looking ahead for the market, I'm expecting October to be much like the month of September with continued weakness in share prices.  I'll be busy adding to some of my current positions while prices are down.  I expect to continue buying through at least the end of this year.  I think stock prices are cheap and it's a good opportunity to beef up some of my long term investments, so I'm not as active in searching for new investments.

TWEEKING MY TAXABLE PORTFOLIO

I've been concentrating a lot lately on my tax deferred retirement accounts and decided it was high time I took a close look at my investment plan for my taxable portfolio.  I spent a few hours this afternoon reviewing my holdings and decided to purchase shares in 3 utility companies to round out my account.  I put in an order to buy shares of DUK, AEP and EXC.  All three stocks have dividend yields close to or above 5% which will add nicely to my cash flow.  I've set my account to reinvest dividends automatically in 2 different stocks per month and pay the remaining 6 dividends to my cash account.  In this way I'll be building a nice cash reserve in an FDIC insured, interest paying account and will be increasing my stock holdings at the same time. 

For a while I had been reinvesting all dividends, however, since I've signed up for the savings plan at work and I'm still investing in my own IRA account, with the new plan for my taxable account I'll have tripled my savings contributions per month.  I think that's probably enough.  The great thing about my current investment plan is that it's all automated.  Everything is set so I have to do nothing but sit back and watch the dividends roll in!  Of course I'll still be actively managing my accounts, making sure that my investment choices are still right for my goals, but otherwise there is very little for me to do.  That's the way it should be, something simple that allows you to sleep at night. 

EIGHT DAYS IN TO SEPTEMBER, MORE OF THE SAME

I suppose the big news this week is the President's jobs program, or as Shakespeare might call it, "Much ado about nothing."  Another $3 billion of taxpayers money down the drain.  The last "stimulus" program didn't stimulate much as far as I can see. 

Anyway, the market is much the same as last week, up and down, but mostly going nowhere fast.  I expect to see more of the same, which is good news for me since I'm in the buying mode.  Not so good for those who bought in at loftier prices. 

Got some great deals with coupons this week!  Took advantage of Schnuck's 10 for $10 sale, matched up coupons on some needed items and walked out with a 70% savings on my total grocery bill.  I expect to do as well or better at Walgreens this coming Sunday.  Already making my shopping lists and matching up coupons with their ad.  I created a simple spreadsheet with Microsoft Works to keep track of my coupon savings starting the first of this month.  Just curious to see how much I'm actually getting with coupons.  I'll post the results at the end of each month. 

BUYING ON THE DOWNSIDE

We had a tumultuous week with the stock market to say the least.  However, I was able to take advantage of the lower stock prices to add to my positions in Clorox, EVEP, LGCY and SGU.  These are all long term holdings in my taxable portfolio.  I also managed to get things moving with work so I'll be able to take advantage of the generous 401k plan there.  They offer a dollar for dollar match up to 5% of my salary.  While I've always looked at my current job as a place to ride out the economic downturn, meaning I hope not to be there much longer, I figure I might as well take advantage of the opportunity to build on my investments while I'm there.  I can always do a rollover on the 401k when I leave.

I doubt we've seen the last of volatility in the market, so I'll be looking to add more to my current investments in the coming weeks and months.  As long as the market is down I'm looking at it as a sale on future dividend income.  So I'll be buying as much as I can afford.  Let's face it, volatile or not, with interest rates in the toilet for the foreseeable future, the stock market is still one of the best games going.

THE MARKET PLUNGES OVER 600 POINTS, OPPORTUNITY IS KNOCKING!

The market plunged over 600 points on the first day of trading after the S & P announced its' downgrade of U.S. debt from AAA to AA+.  While many are fleeing the market for the supposed "safety" of gold and bonds, I'm looking at things from a different perspective.  The U.S. stock market is having one hell of a sale!  Stocks which were valued at much higher prices just last week are down several dollars per share.  So I'm thinking it's time to pull out the stops and go all in.

I'm not recommended this for everyone else, it's what I personally have decided to do in response to the latest market reversal.  It worked out well for me in 2008 and 2009 and I'm looking to repeat the process.  So I've once again set all stocks in my investment portfolio to reinvest dividends, which I'll continue to do until we see some recovery in the market.  Right now I'm hoping that will be way down the road.  The longer I have to pour money in at the lower prices, the better it will be when the market recovers. 

In the mean time, I'll be satisfied knowing that I'm adding to my dividend portfolio at greatly reduced prices.  I'll also be boosting regular monthly investments to both portfolios for the foreseeable future. 

KRAFT SPLIT--GOOD OR BAD?

Kraft has announced plans to split in to two separate companies, spinning the second company off to shareholders by the end of 2012.  One will be a global snack business and the other a North American grocery business.  The grocery business, with revenues around $16 billion a year, would include its' U.S. beverages, cheese and convenience meals with brands like Maxwell House coffee and Jello.  The snacks company would include their high growth European and developing markets units along with their North American snacks and confectionery business, with annual revenues around $32 billion.  It would include brands such as Oreo cookies and Cadbury.

Krafts two largest investors, Warren Buffet (Berkshire Hathaway) and Nelson Peltz are both fine with the split.  Peltz pointed out that it was in the "best interest of shareholders" to separate the high growth snack business from the meat and cheese business.  Allowing investors to take advantage of both companies.  My only real concern is how debt will be divided between the two companies.  We'll just have to wait and see how that goes.  Otherwise, I'm thinking it's a good thing for shareholders.  I'll be adding to my position in Kraft (KFT:NYSE)  in the months before the split.

DOG DAYS OF SUMMER

Well here it is, August 2nd, central Missouri continues to suffocate under sweltering heat, I'll sure be glad when the heat wave is over.  The heat in Washington saw some relief with the deal to raise the debt ceiling, although I wouldn't say it was a victory for either side or for the U.S. economy for that matter.  Be that at is may, most seasoned investors know that adverse market reactions to bad economic news make for great times to pick up bargains on good stocks.  So I'll be concentrating on adding to some of my positions while prices are down and looking for bargains on new additions to my portfolio.  I think I made a good decision to sell some stock last month and pay off high interest debt.  Not only did I free up cash flow, but I got out of the stocks before further declines and put the money to good use.

Collected some great dividend payments at the end of July and the first part of August, so I'm pretty happy about that.  My investment company added an FDIC insured account for parking cash as an option to their traditional money market account.  With the interest on the FDIC account being .5% compared to .01% for the money market account, I've moved my cash to the insured account to pick up some additional interest. 

While the stock market is not doing so well, I've been racking up bargains right and left with couponing.  Picked up $97 worth of merchandise at Walgreens Sunday for just $24 and saved another 67% on my weekly grocery shopping at Gerbes.  The only problem I'm having is finding anything I actually need.  I've built up such a stockpile of groceries, household and personal care items that my shopping lists are getting smaller and smaller.  The good thing about that is I'm able to wait for the very best deals.  Which means that my average savings are going up with each trip to the store.  When I started couponing, I was averaging a 20-25% savings each trip.  Now I routinely save 50-75% on my purchases, allowing me to keep more of my hard earned money. 

OPINION: ONE REASON I WON'T INVEST IN WALMART

I had a lot to do after work today.  One of my errands involved stopping by Wal Mart to pick up a prescription, so I thought I'd use a few coupons to get some things while I was there.  I didn't need much, just picked out 7 items.  Didn't have to wait extremely long in the checkouts, so I thought it would be a quick in and out trip.  WRONG!!!  What actually happened, the cashier short changed me by nearly $5 on my coupons and I had to go to customer service to get it straightened out.  So I had to wait in line there and when I finally got to the counter, they had to go back to the original cashier and check the coupons before they could give me a refund.  I ended up spending an extra 30 to 45 minutes in the store because of their mistake.  While I did get a refund, I didn't hear any apologies for the inconvenience, which makes me wonder how long this type of thing can go on before it starts costing them business.  So it's not likely that I would ever invest any of my hard earned dollars in Wal Mart stock.

BACK TO WORK AFTER THE HOLIDAY WEEKEND

It was a rough start to the work week for me, half our opening staff called in, so I was overloaded with work all morning.  Had to take a nitro tablet to get rid of chest pains, so I decided it was best not to work an extended shift.  It's really hard to read my employers' response to my health problems since the heart attack.  On the one hand, if I just do my job, I work circles around most of the other workers, but on the other hand I'm not quite as capable of doing all the extra work I used to do.  So I'm never really sure where I stand with them, even though they are currently short on help and my medical problems hasn't cost them anything, since I'm not covered under their insurance program.  I sometimes get the feeling they would just as soon be rid of me all the same.  You'd think my boss would be a little more sensitive given that her husband suffered a heart attack around the same time I did.  But who knows???

Anyway, the stock market ended its' 5 day rally, closing down today.  So maybe I'll still have a chance to pick up some bargains over the summer.  Just have to wait and see what happens with the jobs report later this week.  If the numbers are good I'd expect to see more upward movement in the market.

I read an article yesterday about a money management company who moved their clients out of stocks entirely, thinking that the efforts to forestall default in Greece is simply a stall tactic.  While cash isn't a bad thing, I'm not so sure I'd expect the bond market to perform much better than stocks for the remainder of the year.  With interest rates so low and governments scrambling to come up with the money to pay their debts, I'm thinking it's just as iffy a proposition either way.  I'd prefer to stick to dividend stocks myself.  Still no guarantees there, but I'd choose a well managed corporation paying out dividends to government bonds any day.  I figure anything politicians have their hand in is not a very safe place for your money.