Originally Posted by JaxRed
forfreelin04 posted (in actual results thread)
"I don't want to steal JaxRed's thunder at all since he sounds highly educated in dividend paying investments, but dividends are never guaranteed.
If you have a stock that's in the red, and the only reason you have it is for the dividend yield I would caution you against holding it much longer. If NLY chooses to stop paying dividends, your not going to get your yield and subsequently you'll fade even deeper into the red since they'll be a mass exodus at that point.
There's nothing wrong with dividend stock investments. In fact, I would encourage it to the right investor. However, 95% of the country doesn't truly understand the risk involved. Many times retirees get their investment tips from the golf course instead of someone trained and licensed in the field. Certainly, dividend paying stocks are a nice diversification strategy to a balanced portfolio. The problem is many folks get in way too deep with money their actually planning on using in retirement.
It seems like JAXRED here is using the ROTH for his daughter. I don't know how old she is and if he's planning on using the funds for college for her, but in most scenario's people haven't saved enough for retirement to warrant the holding of individual stock's that pay beyond the norm in dividends."
1. First.... I am EXACTLY like taking advice from the guy at the golf course. (except I no longer play golf). Not certified in any way shape or form. Just a guy sharing advice based on years of life experience. I certainly differ from your advice on Dividends.
2. No.... dividends are not guaranteed. But except for federal bonds almost nothing is. It's a question of risk/reward. My advice (following the lead of the Dividend Growth investment community) is to invest in the stocks that make the list of the Dividend Champions, Challengers and Contenders. In the Champions list these are stocks that have raised Dividends for 25 consecutive years like Coke, McDonald's, Johnson and Johnson, etc. Buy the stocks, reinvest the dividends, don't worry about whether they are up or down. Monitor the income stream they are producing.
3. My daughter is 29. I am trying to get her educated/interested in Dividend Growth Investing for retirement purposes.
I am a proponent of Dividend Growth Investing. Forfreel prefers other investing techniques. Plenty of smart ways to invest. I do want to thank forfreel for posting and hopes he continues because the goal here is to make more people aware.
Actually I think your strategy is spot on Jax. My point was just that finance is not a one size fits all store. Your research is impeccable and your principles are great.
What's funny is that my post and my thread were shutdown without a PM or a warning. While you continue to give stock tips as an unlicensed person. It's not the Board or the mod who shut it down's fault; I take it as just another lesson that proves how incredibly flawed a persons thoughts are around investing and advisement. The idea of commission based income is hilariously misunderstood.
The fact that threads like mine were shutdown continue to actually help people in my field because most folks won't get the education around investing or life insurance on their own. Some will, but they'll trust their golf buddy before a person trained to give advice.
Finally to whoever actually shutdown my thread and my post from last week.... Thanks for letting me know!