How Dividend Investing Can Change Your Life

This is a guest post by Millionaire Mob, a blog focused on investing in dividend growth stocks and travel hacking. We have helped thousands of people with bettering their financial future through passive income and dividend investing.

I am on a path to achieve financial freedom through dividend investing and passive income. I am seeking to secure my financial future through these two methods to build income. I seek to have multiple side income streams to be used to recycle into my dividend portfolio. The average millionaire has at least seven different income streams to live off of, so get find yours. Time to go get mine, which is dividend growth investing!

With dividend investing, I like to think of it as a second job. Dividend investing allows me to build an income stream, but also gives an opportunity to realize long-term capital appreciation as stock prices rise. Thus, this results in the ultimate total return scenario.

What is dividend investing?

Dividend investing is a proven strategy that is focused on solely investing in dividend growth stocks that pay a dividend. Usually a company has two options use their cash flow from operations: one is paying a dividend to shareholders and the other is reinvesting the cash flow into the business. A dividend is a payment made by a company to reward shareholders. We’ve built the ultimate guide to building a dividend portfolio to help you succeed in your path to financial freedom.

Why is dividend investing life changing?

If you turn your focus to building a dividend portfolio, you enable yourself to live free. Building a dividend portfolio takes time and effort. However, if you have a specialized plan, you can build your wealth rapidly. Warren Buffett invested in Coca-Cola over 25 years ago. The stock and dividend has increased so much in value that Warren Buffett receives over a 40% dividend yield from his initial investment! I doubt Warren Buffett will ever sell a share of Coca-Cola.

If you look at Warren Buffet’s portfolio, nearly all stocks pay a dividend.

Where do you start to build a dividend portfolio?

• Find a brokerage that you like and one that offers low-commission trading. There are a number of different sites out there that will allow you to trade completely commission-free.

• Write down on paper how much you plan to allocate to the portfolio each month. Try to exceed that amount each month and increase it each year.

• Find the best undervalued dividend growth stocks to start building your portfolio. I suggest having at least 3-4 Dividend Kings in your portfolio. Dividend Kings are safe, high-quality dividend growth stocks that have at least 50 years of increasing their dividends.

• Make your initial investment in the companies that you understand. 

• When you receive your first dividend payment, reinvest it back into your portfolio of stocks! Make sure you are fully invested at all times and continue to allocate your balance transfers.

• Sit back and enjoy the show. Follow the plan and before you know it, your income will continue increase over time.

Please note that you should make these considerations after you have funded your retirement accounts in full or as much as possible. I always advocate for tax-advantaged accounts like a 401(k), Roth IRA or IRA should be fully invested first. After that, you can allocate the remaining to the dividend portfolio as a “sidecar” to build your income.

Dividend investing is not easy and is not a get rich quick method. It takes time and patience, but it is extremely rewarding. What are you going to do to achieve financial freedom? Please let us know in the comments below. We’d love to hear from you.

Follow us on our journey to achieve financial freedom through dividend investing. You can follow along as well with each stock purchase that we make! We look forward to growing with you.

Millionaire Mob is a blog focused on everything online income including: Travel Photography, Travel Rewards, Passive Income, Dividend Growth Investing and Personal Finance advice. I hope to provide the best advice to help you learn and grow along the way. Join the mob of financial freedom experts and escalate your life.Follow us on Twitter or Instagram!

The Potential of Penny Stocks

The working world is not for everyone. Office work can be stultifying to personal relationships, bad for family time and work/life balance. How do you make time for your family if you have tough bosses driving your noses to the grindstone? The commute can be a killer as well. What person can really enjoy a hour back and forth, twice a day, on a car and exhaust filled highways, just to get into a gray, drab cubicle, to work with spreadsheets every day.

That is where you can turn to day trading. Day trading and investing can be your ticket out of the rat race, a way to move beyond the cubicle life and get to a place of financial freedom. Penny stocks, studied and traded with wise, measured calm, can be a great vehicle to a profitable future. The key is learning just what penny stocks are in the world of day trading and how to make money off them.

Penny stocks do not actually cost a penny. They are stocks whose shares are priced between $2-$10 and they are hanging out at the fringes of the New York Stock Exchange or the NASDAQ. Or in smaller, lesser-known exchanges. They can be risky, if you approach them with no training or education in the strategy of day trading. So before you jump into penny stocks with both feet, take the time to engage with a proper day trading education site.

The art of momentum day trading can be broken down into discrete strategies and techniques that allow for real profits. It takes time to learn the strategies in online video classes. Then you can spend time watching over the shoulder of veteran traders in chat rooms, as they share their desktop screens and their vision of the market that day. That is one part of a good day trading education site.

The chat room experience can also offer you an opportunity to work with other people who like you, share the hopes and dreams of financial freedom. The day trading world, especially if you are in a home office can be isolating. It helps to have like-minded people in an online space that can give you a chance to hang out with other aspiring traders.

Then the day trading education site can offer you a paper trading experience that will allow you to hone your trading skills and risk management techniques without losing any actual money. Paper trading is a practice of using virtual currency to work in simulated market conditions that mimic the real thing. That way, you can test out strategies, make trades and get a feel for day trading without the chance of losing your life savings. One good rule of thumb is to get to the point where your daily profits in paper trading get to $200, which would translate to $52,000 per year, before you try out the real stock market.

Penny stocks can be a pathway to your profitable future, but only if you take the education part seriously and diligently.

Avoid Negative Returns

For some reason the majority of Americans have been desensitized enough to accept the fact that your nest egg will have to 'ride the market roller coaster' if you want it to grow. What most people don't realize is that the downswings of the market have a much bigger affect than the upswings. Here is an example.

Lets say you invested $100,000 into a mutual fund and it had a 20% gain one year and a 20% loss the next year. Most likely you would assume that a positive 20% and a negative 20% puts you back at 0 and you broke even. But lets see what really happens:

Year 1 - $100,000 - +20% = $120,000
Year 2 - $120,000 - -20% = $96,000

Lets see what happens if we carry this same pattern out for 2 more years with the same +20% and -20%:

Year 3 - $96,000 - +20% = $115,200
Year 4 - $115,200 - -20% = $92,160

So even though it seems as though the market is staying even over those 4 years, your $100,000 investment is slowly disappearing.

It's become clear in the last few years that having your savings in a vehicle the is susceptible to the ups and downs of the market can have a catastrophic effect on your retirement income. As I said, most Americans have become accustomed to the fact that their savings are at risk and could, one day, dwindle to nothing.
That is because most people have made poor choices when it comes to the locations of their savings.

This is where systems such as You Be The Bank stem from. Systems like these offer a way to truly save your money in a safe, predictable environment where you won’t have to worry about your nest egg being cut in half if the market goes down.

Our economic times have changed the financial world we live in and if you are not willing to change with it you will never get ahead of the status quo. As illustrated above, understanding what negative returns do to your balance is a valuable tool in anyone’s quest to wealth.