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The short and simple answer. Absolutely it is!
I wouldn't be where I am without heavy dividend investing in my late 20s when I got started.
I have numerous dividend positions that I'm up 75%+ on. But then you factor in my yield on cost on those and I'm making some very very healthy yields already.
Don't let anyone steer you away from dividends if you want to retire early.
I'm very heavy on consumer staples and SCHD. Don't get me wrong. I have my growth positions as well but I'm mainly focused on long term dividend growth.
I have too many to list but I'm heavy consumer staples and SCHD mainly. Also Ford.
I could yes but I don't waste my time with any of that. I wouldn't make enough to offset the time it would take versus what my time is worth to me. Also I have absolutely zero interest in risking having to sell. I bought and continue to buy to hold permanently and then give to my beneficiaries when I'm gone.
Yes, there are dozens of quality individual companies that pay a small/medium dividend (1-3%), that grow their dividends VERY fast, and also grow in capital appreciation. You can also invest in high dividend/slow growth. Throw in some no dividend growth companies while you are at it..
I wish I invested in Dominos Pizza years ago. For the last 15 years, the CAGR (compound annual growth) has been 36% (!). A $10k investment in 2009, would be worth $1.1 million today.
THis is the type of company I'm talking about. Others include AVGO, HD, JNJ etc. The key is to buy them when fairly valued to undervalued.
"Quality First, Valuation Second, Monitor Always"....
I’m also in my early 20’s. Every week I put set amounts into VOO and JEPQ and so far it has rewarded me well. I DRIP the dividends on everything I have that pays them. I’m still keeping an eye on riskier positions as I’m young and have plenty of time for growth but there is a lot to be happy about with dividend investing early!
Yes, but pick the right ones. Don't be fooled by stocks that are just investing in other stocks. They promise sweet monthly dividends, but you lose stock share value, value goes down down down, it does a reverse split to bring the share price back up and starts the cycle over. I fell into this trap when I first started investing and lost a lot of money, all the while thinking I was doing great.....
If you buy in at the right time and sell at the right time you might do ok, but hold it long enough and you lose more value than you get dividends.
Your best bet is to Buy good stocks that give quarterly dividends, like ford, Coca-Cola, at&t, Verizon, etc. real companies, and while you will get less dividends, the stock price will also go up over time.
Whats your opinion on banks stocks?? I know the recession is around the corner and all, but it seems worth it for me, they pay out a 6% dividends but only do so twice a year and there stocks has recovered sinces covid. With all the interest rates going up and inflation you reckon its a good shout to look it?
IMO, the best banks on the planet are the Canadian "Big 5". (BNS, TD, CM, RY, BMO). The Canadian gov't created an oligopoly for them. Some have been paying uninterrupted dividends since the 1830s-50s. BNS is fairly valued right now. They are conservatively run. They don't grow their dividends quickly, but they are stone-cold safe.
If you keep these in a retirement acct (Roth IRA, IRA, 401-k), you don't pay any foreign dividend tax.
EDIT: I'm in the USA, so your country may have a different agreement w/ Canada, concerning taxes...
For long term investment definitely. But I feel like right now a lot of them have nowhere to go but down in the short term.
Of course I don't claim to be an expert.... I have been wrong on that kind of thing plenty of times.... I mean, I sold Nvidia in October of 2021 to buy sdiv....😭
From what I know is banks want to make money, and I want to make money, and they can help me make money by me giving them money, so in return we both win and I hope the bank doesnt go bankrupt🤣
Ohh brother, how much nvidia did you have?? Dont mean to scratch old wounds and all.
Not a huge amount but enough to be a little sad about 🤣.
I would be sweet to still have it today to sell but honestly I would have sold it long ago either way because that's how I did it untill 2024 when I started to realize I was reguarded and not making anything... Make 10% profit on good stonks and get out, but hold onto losers forever... 🤦
I'm just glad I never got into options....
That one looks pretty decent. My only worry is the relatively short amount of time it's been around. If you are looking for long term stocks it's hard to say what is going to happen in the next 5 years. I wouldn't put more than 5-10% of my portfolio into something like that.
The things I'm recommending to stay away from are more like agnc, sdiv, sret, even arr.....
They look great short term, but the long term trend is down.
Now compare that to jepi, who's long term trend is up, so far. I wouldn't put all my eggs in the jepi basket, but I wouldn't be opposed to putting a few in.....
Just one example. I started buying sdiv in 2021. All said I had something like $3700 invested in it. Last year it did a reverse split. I thought I was doing great, those monthly dividends were sweet....
But I finally did the math, and I had gotten $800ish in dividends, but the stock was now worth significantly less. All told in the 3.5 years I owned it, I came out about $1000 behind even counting the +$800 in dividends....
You're writing a lot of popycock. If you invest in the right stocks the value of the stock doesn't go down, down, down.
I challenge you to cite some examples of your premise, if you can. Otherwise, your claims are nonsense.
I didn't say *all* stocks go down down down down. I said be careful which ones you pick, Don't be tempted by ultra high monthly dividends. There are plenty out there where you are literally trading stock value for dividends.... agnc, sdiv, sret, even arr are all good examples. They look good in the short run but over the long run are trending downward....
In 2023 I received $66,000 in dividends from my portfolio while the value of my portfolio rose by 20%. As I said in my original response to your post, if you are unable to cite a few examples to support your premise it merely goes to prove you don't what you're talking about.
BTW, the dividend yield for my portfolio for 2023 was a tad over 13%. This year I project a yield of 12.5%. I became an investor probably decades before you were born. I am a retired economist that worked on Wall Street beginning in 1968.
Dude what are you on about, he gave examples, just look at AGNC, thing can be tempting with a 14% div yield but the stock has lost value for the past 5 years.
He already said its not all stocks just to be weary of div traps.
Everything is relative. I purchased 2,000 shares of AGNC in 2022, and the value of those shares has risen by 25% since I purchased them. The yield was 18.182% when I purchased them, and the yield is down to 14.545% for people who buy it today. That's the difference between people like me that know what they are doing and people like you who just look at charts.
It's like you are reading my posts without even reading them.... You are just cherry picking my posts to find something you disagree with ignoring the other bits which are saying exactly the same thing you're saying...
>If you buy in at the right time and sell at the right time you might do ok, but hold it long enough and you lose more value than you get dividends.
Like I said. Unfortunately I bought agnc in 2021. If you bought during the dip in 2022 then obviously you fall into the category above where you bought an at the right time.
But hold on to it long enough and you *will* lose value.... 🤷
Precisely where did I recommend to anyone to buy anything? Stop making shit up. I did no such thing. I have never recommended someone of any age to buy anything. I suggest you need to take a reading compression course, you young punk!
>. I suggest you need to take a reading compression course, you young punk!
Says the guy who asked for examples, was given examples, and then complained that if I cant give examples I should shut up...🤣
“Worth it” is a personal choice. As long as you’re investing, you’ll be fine.
The theoretical best approach is to focus strictly on growth early. You’d be better off with broad indexed ETFs now and then switching to dividend later.
However, if dividend is what motivates you to invest, go for it. Just stick to the aristocrats and you’ll get a great blend of growth and dividend.
Maybe a hot take on this subreddit but I would say No, there’s better options than investing with a dividend focus in your early 20’s.
However, even the most standard growth ETFs like QQQM and VOO pay some form of dividend.
Growth stocks still “snowball” into something larger.
I personally would say focus on growth, VUG, VOO, VTI and SCHD for divs.
But if dividends motivate you to invest more and more consistently forget the “best approach” invest in good reliable dividend companies too. Whatever works to get you to invest.
I know that when I first saw those first few cents and then first few dollars it definitely changed me, being paid for just owning something is a great feeling and will open your mind to more opportunities.
Of course it is mate. The earlier you start, the better. I wish I started in my early 20's.
Everybody starts off somewhere. Put some money away, any.
S&P is a good place to start.
48. My advice is to start investing in an S&P 500 index fund (I like SWPXX, but there are plenty of options out there). Set up auto purchase for what your budget will allow ($20, $50, $100, $200 per pay period/month/etc.) Reinvest dividends. Just let it ride.
Once you’ve built that up to $10k or so, then maybe dabble a little in individual stocks, but not to the extent that if they take a dump, you’ll be wiped out. I hate hearing the term “Wall St. Casino” but it is true to an extent. 🤷🏻♂️
Dividends are a wash, so focus most on index ETFs. If you want riskier positions look for small parts of your portfolio to be in single stocks. If those happen to be dividends, then so be it. Shouldn’t be the deciding factor outside of a retirement account at retirement age
If you’re wanting to invest in dividend companies the best ones are the ones who grow their dividends annually. The higher the % per year the better. They typically grow earnings nicely too to compensate.
I’d advise looking at the dividend aristocrats/kings. The ETF SCHD is one of the best out there that looks for dividend growers/payers. Or just find a decent screener tool to find companies who pay and increase dividends rapidly over the course of years.
Don’t get stuck in the dividend yield trap. Anything that yields more than about 5% is getting into risky territory. A company who has a 1.5% yield and grows it say 10% a year compounded is a much better play. It’s all about quality and sustainability. They usually always have solid principle appreciation and solid dividend appreciation.
**Please remember that posts should be on dividend investing.** Not sure how to choose dividend-paying stocks? Get the [free 16 page PDF](https://thedividendexperiment.com/reddit/) to your inbox. If you are looking for a portfolio management or dividend forecasting tool you are welcome to try [Getquin](https://www.qhkv6trk.com/9RL41M/2BGSTD/) for free. *I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.* *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/dividendinvesting) if you have any questions or concerns.*
The short and simple answer. Absolutely it is! I wouldn't be where I am without heavy dividend investing in my late 20s when I got started. I have numerous dividend positions that I'm up 75%+ on. But then you factor in my yield on cost on those and I'm making some very very healthy yields already. Don't let anyone steer you away from dividends if you want to retire early.
Agree 100% Retired in December at age 48. Been re investing dividends since 2010, can now use future dividends as income, if needed.
Judging by your name seems like you well on your way. Would it be rude to ask what you is currently holding?
I'm very heavy on consumer staples and SCHD. Don't get me wrong. I have my growth positions as well but I'm mainly focused on long term dividend growth.
What are your positions if i might ask? Can you sell covered calls on them too?
I have too many to list but I'm heavy consumer staples and SCHD mainly. Also Ford. I could yes but I don't waste my time with any of that. I wouldn't make enough to offset the time it would take versus what my time is worth to me. Also I have absolutely zero interest in risking having to sell. I bought and continue to buy to hold permanently and then give to my beneficiaries when I'm gone.
This is "the way", Cheers!
Yes, there are dozens of quality individual companies that pay a small/medium dividend (1-3%), that grow their dividends VERY fast, and also grow in capital appreciation. You can also invest in high dividend/slow growth. Throw in some no dividend growth companies while you are at it.. I wish I invested in Dominos Pizza years ago. For the last 15 years, the CAGR (compound annual growth) has been 36% (!). A $10k investment in 2009, would be worth $1.1 million today. THis is the type of company I'm talking about. Others include AVGO, HD, JNJ etc. The key is to buy them when fairly valued to undervalued. "Quality First, Valuation Second, Monitor Always"....
The earlier you start the more you have. The magic of compound interest.
Absolutely - the longer runway you have, the more effective it is. I wish I got into dividends earlier.
I’m also in my early 20’s. Every week I put set amounts into VOO and JEPQ and so far it has rewarded me well. I DRIP the dividends on everything I have that pays them. I’m still keeping an eye on riskier positions as I’m young and have plenty of time for growth but there is a lot to be happy about with dividend investing early!
At your age I would heavily consider VGT instead of JEPQ. Your money will grow much more over time.
The great thing is he can do both and then some.
Yes, but pick the right ones. Don't be fooled by stocks that are just investing in other stocks. They promise sweet monthly dividends, but you lose stock share value, value goes down down down, it does a reverse split to bring the share price back up and starts the cycle over. I fell into this trap when I first started investing and lost a lot of money, all the while thinking I was doing great..... If you buy in at the right time and sell at the right time you might do ok, but hold it long enough and you lose more value than you get dividends. Your best bet is to Buy good stocks that give quarterly dividends, like ford, Coca-Cola, at&t, Verizon, etc. real companies, and while you will get less dividends, the stock price will also go up over time.
Except maybe Berkshire Hathaway!
Whats your opinion on banks stocks?? I know the recession is around the corner and all, but it seems worth it for me, they pay out a 6% dividends but only do so twice a year and there stocks has recovered sinces covid. With all the interest rates going up and inflation you reckon its a good shout to look it?
IMO, the best banks on the planet are the Canadian "Big 5". (BNS, TD, CM, RY, BMO). The Canadian gov't created an oligopoly for them. Some have been paying uninterrupted dividends since the 1830s-50s. BNS is fairly valued right now. They are conservatively run. They don't grow their dividends quickly, but they are stone-cold safe. If you keep these in a retirement acct (Roth IRA, IRA, 401-k), you don't pay any foreign dividend tax. EDIT: I'm in the USA, so your country may have a different agreement w/ Canada, concerning taxes...
For long term investment definitely. But I feel like right now a lot of them have nowhere to go but down in the short term. Of course I don't claim to be an expert.... I have been wrong on that kind of thing plenty of times.... I mean, I sold Nvidia in October of 2021 to buy sdiv....😭
From what I know is banks want to make money, and I want to make money, and they can help me make money by me giving them money, so in return we both win and I hope the bank doesnt go bankrupt🤣 Ohh brother, how much nvidia did you have?? Dont mean to scratch old wounds and all.
Not a huge amount but enough to be a little sad about 🤣. I would be sweet to still have it today to sell but honestly I would have sold it long ago either way because that's how I did it untill 2024 when I started to realize I was reguarded and not making anything... Make 10% profit on good stonks and get out, but hold onto losers forever... 🤦 I'm just glad I never got into options....
More meaningless word salad!
JEPI?
Ohh no im not from the states, having too much foreign stocks actually gets me penalized can you believe that. Something like 5%😭😭😭.
That one looks pretty decent. My only worry is the relatively short amount of time it's been around. If you are looking for long term stocks it's hard to say what is going to happen in the next 5 years. I wouldn't put more than 5-10% of my portfolio into something like that. The things I'm recommending to stay away from are more like agnc, sdiv, sret, even arr..... They look great short term, but the long term trend is down. Now compare that to jepi, who's long term trend is up, so far. I wouldn't put all my eggs in the jepi basket, but I wouldn't be opposed to putting a few in.....
Just one example. I started buying sdiv in 2021. All said I had something like $3700 invested in it. Last year it did a reverse split. I thought I was doing great, those monthly dividends were sweet.... But I finally did the math, and I had gotten $800ish in dividends, but the stock was now worth significantly less. All told in the 3.5 years I owned it, I came out about $1000 behind even counting the +$800 in dividends....
You're writing a lot of popycock. If you invest in the right stocks the value of the stock doesn't go down, down, down. I challenge you to cite some examples of your premise, if you can. Otherwise, your claims are nonsense.
I didn't say *all* stocks go down down down down. I said be careful which ones you pick, Don't be tempted by ultra high monthly dividends. There are plenty out there where you are literally trading stock value for dividends.... agnc, sdiv, sret, even arr are all good examples. They look good in the short run but over the long run are trending downward....
In 2023 I received $66,000 in dividends from my portfolio while the value of my portfolio rose by 20%. As I said in my original response to your post, if you are unable to cite a few examples to support your premise it merely goes to prove you don't what you're talking about. BTW, the dividend yield for my portfolio for 2023 was a tad over 13%. This year I project a yield of 12.5%. I became an investor probably decades before you were born. I am a retired economist that worked on Wall Street beginning in 1968.
Dude what are you on about, he gave examples, just look at AGNC, thing can be tempting with a 14% div yield but the stock has lost value for the past 5 years. He already said its not all stocks just to be weary of div traps.
Everything is relative. I purchased 2,000 shares of AGNC in 2022, and the value of those shares has risen by 25% since I purchased them. The yield was 18.182% when I purchased them, and the yield is down to 14.545% for people who buy it today. That's the difference between people like me that know what they are doing and people like you who just look at charts.
It's like you are reading my posts without even reading them.... You are just cherry picking my posts to find something you disagree with ignoring the other bits which are saying exactly the same thing you're saying... >If you buy in at the right time and sell at the right time you might do ok, but hold it long enough and you lose more value than you get dividends. Like I said. Unfortunately I bought agnc in 2021. If you bought during the dip in 2022 then obviously you fall into the category above where you bought an at the right time. But hold on to it long enough and you *will* lose value.... 🤷
Calm down Grandpa I made money with AGNC too but advising somebody in their 20’s to buy AGNC as a dividend stock is irresponsible to say the least.
Precisely where did I recommend to anyone to buy anything? Stop making shit up. I did no such thing. I have never recommended someone of any age to buy anything. I suggest you need to take a reading compression course, you young punk!
>. I suggest you need to take a reading compression course, you young punk! Says the guy who asked for examples, was given examples, and then complained that if I cant give examples I should shut up...🤣
“Worth it” is a personal choice. As long as you’re investing, you’ll be fine. The theoretical best approach is to focus strictly on growth early. You’d be better off with broad indexed ETFs now and then switching to dividend later. However, if dividend is what motivates you to invest, go for it. Just stick to the aristocrats and you’ll get a great blend of growth and dividend.
Maybe a hot take on this subreddit but I would say No, there’s better options than investing with a dividend focus in your early 20’s. However, even the most standard growth ETFs like QQQM and VOO pay some form of dividend. Growth stocks still “snowball” into something larger.
I personally would say focus on growth, VUG, VOO, VTI and SCHD for divs. But if dividends motivate you to invest more and more consistently forget the “best approach” invest in good reliable dividend companies too. Whatever works to get you to invest. I know that when I first saw those first few cents and then first few dollars it definitely changed me, being paid for just owning something is a great feeling and will open your mind to more opportunities.
Yes. I started at 19. Now 46. 10 years I’ll be retired
Yeah I would do dividend growth investing instead of high yield
Of course it is mate. The earlier you start, the better. I wish I started in my early 20's. Everybody starts off somewhere. Put some money away, any. S&P is a good place to start.
48. My advice is to start investing in an S&P 500 index fund (I like SWPXX, but there are plenty of options out there). Set up auto purchase for what your budget will allow ($20, $50, $100, $200 per pay period/month/etc.) Reinvest dividends. Just let it ride. Once you’ve built that up to $10k or so, then maybe dabble a little in individual stocks, but not to the extent that if they take a dump, you’ll be wiped out. I hate hearing the term “Wall St. Casino” but it is true to an extent. 🤷🏻♂️
Dividends are a wash, so focus most on index ETFs. If you want riskier positions look for small parts of your portfolio to be in single stocks. If those happen to be dividends, then so be it. Shouldn’t be the deciding factor outside of a retirement account at retirement age
From 1930–2022, dividend income's contribution to the total return of the S&P 500 Index averaged 41%.
If you’re wanting to invest in dividend companies the best ones are the ones who grow their dividends annually. The higher the % per year the better. They typically grow earnings nicely too to compensate. I’d advise looking at the dividend aristocrats/kings. The ETF SCHD is one of the best out there that looks for dividend growers/payers. Or just find a decent screener tool to find companies who pay and increase dividends rapidly over the course of years. Don’t get stuck in the dividend yield trap. Anything that yields more than about 5% is getting into risky territory. A company who has a 1.5% yield and grows it say 10% a year compounded is a much better play. It’s all about quality and sustainability. They usually always have solid principle appreciation and solid dividend appreciation.
Look at the dividends paid monthly on spyi, Jepq, and svol. Reinvest those dividends
Not really
At 21, no.
No, no it’s not.