Finance Advice Thread

Hey Blade,

If I purchased 250 shares of SACH ever year and they continued to pay a dividend of 12%... and I used that dividend to purchase more stocks each year, how many shares of Sach would I have after 30 years and how much would I get as dividend income?

Lets assume $4.00/share is a constant... its a big assumption but its been floatng around there for years and its there now.

That means $1000 annual investment yields me 250 shares a year. 12% of that $1000 is $120.00 in annual dividend income, which is 30 more shares I can purchase.
So year two 250 shares I buy, 250 I had, and 30 more I received from the dividend income. That's 530 shares at a value of 4 each that's $2120 and 12% of that is $254.00 dividend income which buys me 63.6 shares alone.

If we keep doing this annual 1000 dollar contribution to Sach Shares and reinvest the dividend income at the assumed $4.00/share rate, this is what it looks like after thirty years:

[IMG]https://i.ibb.co/hBT098D/image.png[/IMG]

Now this is an understatement considering dividends are compounded quarterly so it would be more... but this sounds like a solid retirement for someone who can put away 85/month for retirement. Yields 30k/year in retirement.

I did this during my lunch, let me know if you guys spot a mistake

BTW I just did this to kill time, not suggesting anyone go all in on any single company.

Diversify the portfolio to be better ready for a recession.

You are right. I completely understand your point and have no qualms.

But I do wonder how it compares to say usbank or at&t, which has half the dividend in percentage than sach, but expected growth will be much more in the 5G era. At that point if we consider growth, it might more than make it up compared to a REIT like sach that is unlikely to grow very much in pure stock value even if it has twice the dividend in percentage. You see what I'm saying??

I'm going to later analyze a comparison to your sach example when I get to my computer.

[QUOTE=bladefd;14117975]You are right. I completely understand your point and have no qualms.

But I do wonder how it compares to say usbank or at&t, which has half the dividend in percentage than sach, but expected growth will be much more in the 5G era. At that point if we consider growth, it might more than make it up compared to a REIT like sach that is unlikely to grow very much in pure stock value even if it has twice the dividend in percentage. You see what I'm saying??

I'm going to later analyze a comparison to your sach example when I get to my computer.[/QUOTE]

No not really... if you're basing all of your retirement on stock value vs dividend and we fall into a recession like now, what happends? When you retire, what are you going to do? Start selling off stocks each year you need money? Doesnt make much sense to me...

Sach is unlikely to grow in stock value, but it doesnt matter. After 7 years it pays for itself...

Banking on dividends is not a good idea in my opinion due to any change in price per share can wipe out your dividends. Thus, making you a bag holder. You don't lose money until you sell so why bank on dividends. I have GM and for the most part have pretty decent dividends since the last time I check but their stock isn't that good. I'm basically breaking even. I really want to get rid of it as I'm bag holding this company. It did break $30 for the first time in a long time.

This is the speculation business and I will gamble on small companies but I use fundamentals such as quarterly reports and financial reports to help me in picking a blue chipper.

You're wasting your time unless you have at least 40k in the bank to move around and you're not emotionally attached to it.

You can't day trade unless you have 25k.....if you pattern trade then your account will be banned. Retail investors are just helping the day traders out. Helping me out. I can buy and sell as I please on any day and take the profit. These small traders have to wait another day or it's considered pattern trading. It will count against their week.

[IMG]https://media4.giphy.com/media/kDTKcsS2Ht5KGuGbJu/giphy.gif[/IMG]

The money will always be in real estate. That's your best bet and sure bet.

The business of speculation is too risky but very lucrative if you have money to blow and you're not worried. It's a different animal when I'm seeing thousands of dollars fluctuate up and down. I don't look unless it's an important or crazy day.

[QUOTE=Luka Doncic;14118565]Banking on dividends is not a good idea in my opinion due to any change in price per share can wipe out your dividends. Thus, making you a bag holder. You don't lose money until you sell so why bank on dividends. I have GM and for the most part have pretty decent dividends since the last time I check but their stock isn't that good. I'm basically breaking even. I really want to get rid of it as I'm bag holding this company. It did break $30 for the first time in a long time.

This is the speculation business and I will gamble on small companies but I use fundamentals such as quarterly reports and financial reports to help me in picking a blue chipper.

You're wasting your time unless you have at least 40k in the bank to move around and you're not emotionally attached to it.

You can't day trade unless you have 25k.....if you pattern trade then your account will be banned. Retail investors are just helping the day traders out. Helping me out. I can buy and sell as I please on any day and take the profit. These small traders have to wait another day or it's considered pattern trading. It will count against their week.[/QUOTE]


Your first paragraph does not apply to all stocks.

REIT stocks MUST pay 90% of their net earnings to their shareholders.

I've said this a million times....

The whole saying "You don't lose money until you sell" is true, but by the same token "you dont make money until you sell" is just as true for most stocks

Diversification is the only sure fire bet...if you put everything into real estate, stocks, BTC, etc etc...that's a recipe for disaster.

[QUOTE=rawimpact;14118604]Your first paragraph does not apply to all stocks.

REIT stocks MUST pay 90% of their net earnings to their shareholders.

I've said this a million times....

The whole saying "You don't lose money until you sell" is true, but by the same token "you dont make money until you sell" is just as true for most stocks[/QUOTE]

I understand this and I also like to give you credit for your spreadsheet and your well thought out plan. I'm just merely making a point in regards to 'dividends' in general. If you're going the REIT route then it looks like you have a plan because I don't know much about those companies.

Sh!t, I forgot about my trailing stop limits. Couple went off today. Sold at a loss when I didn't want to.. Arghh, I need to raise it to 20%.. 10% was too low. I guess you learn from your mistakes.

I feel bad for those that jumped into the apple split... my brother being one of them. Wont matter long term but still... off on a sour note.

[QUOTE=~primetime~;14118610]Diversification is the only sure fire bet...if you put everything into real estate, stocks, BTC, etc etc...that's a recipe for disaster.[/QUOTE]

totally agree, which is why I converted my retirement account into a diverse collection of beanie babies

[QUOTE=Nanners;14124154]totally agree, which is why I converted my retirement account into a diverse collection of beanie babies[/QUOTE]

TY for that info

[QUOTE=rawimpact;14124156]TY for that info[/QUOTE]

I also have pogs