I mean dividend growth investing is phenomenal but you won't hear much about it bc money managers would be in trouble if they couldn't explain to you why you need them to help you buy a basket of stocks on your own.You don't wanna buy less than $1000 of any stock bc of fees involved, but if its holding forever, $500 should be fine. Make your basket, and buy which ever one is trading at the best valuation at the time you have new money....some will be at high's, some will be beaten down.
It's pretty simple, dividends of healthy companies grow every year well in excess of inflation so your income is protected and in a drip you collect more share which payout more of that income every quarter. Every 3 months you will make more "income" than you did in the previous 3 months.
If share prices go up, great, you made some unrealized capital gains and if share prices go down, fantastic, your dividend buys you more shares at a lower price thus boosting future income
Do you know how many people have become millionaire just by buying, holding, reinvesting dividends in some of these bluechips around you?
I promise you that if you buy something simple like coca cola and add $500/month to it you will be a millionaire in 30 years. You will have at least $1M of stock which will be paying you a ton of dividends. Now what will a million dollars be then? Who knows, but I know your income stream will always be ahead of inflation
Personally I feel there are much better dividend growth stocks out there today but exxon,chevron,coke,ATT,Pepsi,Altria any of these companies are going to be around long after you and I are gone so I really don't see how you can go wrong with any, but I personally chose PM bc
1.I know world governments rely on cigarette taxes
2.growth in world population
3.massive growth in its dividend every year. The dividend is up over 84% in the last 5 years....did you collect an 84% raise in your income at work? Really if you were getting $50,000/yr in dividends in 2008 you're making $90,000/yr today without buy 1 new share
4.basically a hedge on a falling US dollar, which will happen at the rate we're printing
5.little to no regulation outside the US on things like lawsuits or cigarette advertising which targets children( joe camel and marlboro man were key in the cigarette boom in america before they were banned)
Here's a few pieces on DRIP's over time LINK LINK
Of course swinging for the fences is nice, but I make my money from work not stocks, I use stocks to build my side business today that will grow its income to me every year, this business is "dividends" which will be my full time business in 20 years funding my lifestyle without working
This post was edited on 6/23 at 12:07 pm