Thursday, October 30, 2014

Using Extreme Frugality In The Beginning To Get Things Rolling

Life is a journey. An ever-changing one, at that.
As such, it would be unrealistic to expect that one would maintain the same lifestyle or same ideas about life from childhood to death. We grow. We learn. We change. We hope to become better versions of ourselves as we age.
At least, that’s what I’m really after. A better version of myself. And I’m most “me” when I’m free, not constrained by a 9-5 where a boss dictates my every movement. When I work. When I eat. When I go home.
So not long after I first started walking the path to financial independence I was willing to do whatever it took to better my situation. I had a pile of student loan debt. I had very little cash. I had no investments. Basically, my options were pretty limited. And financial independence or retiring early is all about maximizing your options. Increasing flexibility. Making your life whatever you want it to be.


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Wednesday, October 29, 2014

Dividend Income Update: September 2014

Every year or so my brain tells me that I have a hankering for some deep fried chicken from the Colonel. So I indulged my craving and I went there for supper this week. It only takes one meal to remember why I never eat there but this trip was a little unnerving. Six years ago I could get a ten piece meal for $23. Now they sell the same meal, with only 8 pieces of chicken for $30. That’s a huge price jump let alone you get even less chicken. It’s like a double inflation squeeze by increasing the price and decreasing the amount of product. I’m no math scientist, but that’s a hell of a lot more than the 2% inflation rate my government keeps reporting to me each year.

I left actually feeling slightly panicked thinking about my future; taking my possible future grand kids to “Soylent Fried Chicken” and paying 800 credits for a meal. I’m sure it would end in a stern lecture to the kid working the counter about how in my day, it would only cost $23 and that I remember when the internet never existed!  I know a lot of people my age don’t even think twice about inflation but they should be very, very concerned. Keeping  your money in a savings account making .5% while everything is going up 4-5% means you won’t be eating any Soylent Chicken…it means you WILL be the Soylent Chicken!

If companies keep inflating their prices, then their dividend increases should keep up with it. At least that’s what I’m betting on. Just recently Emera increased their dividend 6.9% from $1.45 per share to $1.55 per share. That doesn’t seem like a whole heck of a lot, but if you look at the big picture it’s actually pretty sweet. I bought some shares of Emera for $23 which means my yield on cost is now 6.74%. Next year I’ll bet you I’ll be making over 7% on that same investment. When’s the last time you had and investment that increases your return every year without having to sell it? What about an investment that pays you that return with cash money and is not just some statistic in a graph that your adviser points to, saying you made that much?

I love Dividends!

No matter how much time passes, I still get excited about dividend investing. It’s a slow process to build up your wealth but getting paid along the way sure helps build confidence in it. Why, this time last year I was tallying up the dividend income to be $398 for September. This year my dividend income for the month of September was:

$525


That’s enough dividend income to pay for a car payment or a year’s supply of sardines and crackers if I were to retire tomorrow. I would need to be really hungry to make that work but I’m sure I could. That makes my year to date total dividend income to be $4815. Not quite enough to hang up the old cover-alls just yet, but someday it will be. Until then, I’ll just keep doing what I’m doing; becoming wealthy one dividend payment at a time.

This article was written by The Loonie Bin. If you enjoyed this article, please consider subscribing to his feed.


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Tuesday, October 28, 2014

3 Fairly Priced High-Margin Stocks Warren Buffett Would Like

Everybody wants to make money, big money over the long-haul. You put money into a stock and get twice of this amount back in 10 years. That's great and I have often invested into stocks that doubled in a decade easily.

Today I like to come back to return. It's very important to see that the company makes good profits on its annual sales. The higher the margin, net or operational, the better is the market dominance of the firm.


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Monday, October 27, 2014

7 Higher-Yielding Stocks With A Low Price To Book

When looking for value-priced stocks, the Price-To-Book (P/B) ratio is one that I like to consider. P/B is calculated as share price divided by book value per share. Book value is most often calculated as Assets less Liabilities.


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