Is It Worth It?

I really like to frame every purchase I make a certain way. Outside of normal, recurring monthly bills like rent, groceries, my cell phone bill and the like I really try to make sure I'm completely aware of the costs of any item I buy. What I like to do, especially with an expense that will recur on an ongoing basis (like a car payment, gym membership), is to not look at the actual costs of the item or service, but rather I look at how much money I'd have to have saved up to offset that expenditure.

Warren Buffett's Wise Words

"The Oracle of Omaha". Warren Buffett, the famed value investor and billionaire, is probably the most intelligent capital allocator alive. So, anytime he drops a little advice on mere mortals like myself I like to stop what I'm doing and listen.

He was interviewed on CNBC's "Squawk Box" program this past Wednesday. Buffett was asked about a number of different issues, including his thoughts on the global economy, the upcoming election, housing and potential acquisitions among other subjects. For interested parties, you can watch the entire interview/read the transcript here.

What Are You Buying?

Boom! Just like that, the Dow Jones Industrial Average is down almost 450 points over the last week. It's times like these that I really smile. As a long-term dividend growth investor I stay focused on value. I want to buy as many shares as I possibly can with my dollar, and the cheaper the shares are the larger the percentage of a business I can own and the more dividends I receive.

Mr. Market has been particularly grumpy lately, and it shows. Major companies like McDonald's Corporation (MCD) and Intel Corporation (INTC) have seen their shares sell off lately due to lackluster earnings numbers. Many things are to blame here, with the weak global economy and strong competition being commonly cited.

What one has to stay focused on is the long-term. Every time I look to purchase shares in a company I always keep in mind that I'm investing in a business. I'm taking my hard earned money and buying a percentage of a company, not just some ticker symbol. I work very hard for my money, and I take investing very seriously. So, I always focus on the long-term fundamentals of a company and I try to get the most bang for my buck. We dividend growth investors focus on value because the cheaper the shares, the higher the yield and the more income we can squeeze out of our invested capital. Better entry prices also lead to a higher total return when factoring in capital gains as well.

With all this being said, I'm taking a strong look at the following companies based on strong operations, solid values on the shares and long histories of paying rising dividends. I'll have some fresh capital at the beginning of November, but if a purchase compels me then I may pull the trigger sooner than that. I always like to share with you readers what's currently on my watch list for a potential upcoming purchase. Let's take a look at some solid long-term opportunities.

Fear And Uncertainty Creates Opportunity

Earnings season is upon us and in case you haven't noticed there have been some serious pullbacks in certain dividend growth stocks. Companies have been busy publicizing their Q3 earnings and revenue numbers and it seems that the weakened economy have hurt some. It's times like these that you have to ask yourself if you're really in the market for the long-term or not.

For instance, McDonald's (MCD) recently posted its worst quarterly sales growth in nine years and shares sold off by 4.46% on Friday. McDonald's global sales at new restaurants fell below 2% for the first time in almost 10 years. So, is this the time to sell MCD or is this an opportunity to purchase shares? Are you a trader or an investor?

Saving Money Is Like Losing Weight

How Much Are You Putting Away?

A lot of things in life are easier said than done. I think this is also true when it comes to saving money.

How does one go about saving money? Well, quite easy really. You simply spend less money than you receive on a regular basis. All the thousands of books, articles and television shows on personal finance really just regurgitate this simple equation. I'm guilty of the same.

You can talk about clipping coupons, skipping a daily latte and finding a gas station that's $0.03 less per gallon than every other gas station in town, but you're simply missing the forest for the trees. You're focusing on small potatoes. If you're really serious about trying to become financially independent at a young age you need to stop cutting coupons to save $1.00 off your $4.00 purchase and cut the $4.00 purchase out of the budget completely. You need to stop thinking about finding cheaper gas and start thinking about how to live without a car, or at least drive it significantly less.

Recent Buy

As promised, I'm publishing my second recent purchase. I'm generally fairly inactive in the stock market, casually watching the market move up and down when I can. I stay fairly busy throughout the workday, so I can't really watch the market's sways to and fro...and wouldn't much want to even if I had the time. But, this week will likely be my only activity for the entire month of October, unless there is a major price drop in some attractive dividend growth stocks allowing me ample opportunity.

As part of my Recent Buy series, I try to let my readers know of any equities I purchase soon after the transaction is completed. This is just one way I try to document my progress toward early retirement and financial independence.

Recent Buy

Flush with cash from the recent sale of one of my oldest holdings in Total S.A. (TOT), I decided to initiate a new position in a stock that I've been looking at over the last 30 days or so. I like particular industries that are profitable, easy to understand and sell products that people purchase in up and down economies. Tobacco certainly fits the bill here, and adds an even more interesting element to the mix in the fact that it's an addictive product. I really love Philip Morris International (PM) in this space, and it's my favorite tobacco stock of all. However, I like to stay diversified and hedge my bets, and with  PM already my largest holding I decided to look elsewhere.

As part of my Recent Buy series, I try to let my readers know of any equities I purchase soon after the transaction is completed. This is just one way I try to document my progress toward early retirement and financial independence.

Recent Sale

I don't sell stocks often. Any regular readers of this blog know that. I don't try to time the market and I don't trade in and out of positions. Ever since I firmly adopted a dividend growth strategy for the long-term I have planned on holding every position forever unless dividends are cut or held static, or if fundamentals drastically change.

However, there was a small period of about four months when I was actively investing in the stock market before I fully committed to the dividend growth strategy. This was in early 2010. The good thing is that it didn't take me very long to realize that DG investing is a solid long-term strategy and I didn't make too many mistakes before using this strategy as the foundation for my long-term wealth building plan.

Dividend Growth Index Update - Q3 2012

As some of you may remember, I was picked to be part of a Dividend Growth Index back in September of 2011. I joined a number of well-known and respected dividend bloggers, where we formed an index of high-quality dividend stocks that we all decided we would keep track of over the long-term. It's an exercise determined to show the power of dividend investing over the long haul.

This index was created by The Dividend Guy and asked a number of us fellow bloggers to join in on the fun. I was more than happy to oblige.

We have been collectively updating our readers every quarter on the overall status of the index, with each one us specifically discussing our individual picks for the index. We each chose three stocks, and with eight people involved the index tracks 24 individual equities.

Income/Expenses For September 2012

Each month I will post my income/expenses for the previous month. I track every dollar in and out, so what you see is exactly what I earned and spent (rounded to the nearest dollar).

Dividend Income Update - September 2012

Another month has passed by, and it's time for me to post an article on my favorite subject: dividend income. The reason why I love to post articles on dividend income is because it's pure numbers. It's hard to argue the success of long-term dividend growth investing when you can slowly and surely see dividend income rise over time and get closer to covering one's expenses.

Boy, what can I say? This month was simply wonderful. I achieved my highest dividend total ever! I'm simply blessed to be able to continue my journey and receive dividends from companies that continue to do a great job in their respective industries and pay me as a capital investor. Huge monthly dividend totals put a smile on my face like almost nothing else. It's months like September that reinforce my belief that my journey to financial independence before 40 is possible.

I hope these monthly dividend income reports provide inspiration for any investors out there that are just starting out. It's easy to see these payments rising month after month and it shows that it's possible to one day pay for monthly expenses with dividends, which would provide an investor opportunities and freedom to pursue other interests than full-time work. Without further ado:

2012 Stock Picking Contest - Q3 Results

Earlier this year, yours truly was asked to participate in a friendly stock picking contest involving nine other bloggers. I happily agreed!

There was nothing about this contest that involved picking dividend growth stocks specifically, but you just know that I can't pick anything else. I believe in my heart that this strategy is absolutely the way to go to build long-term wealth. I'm so confident in that belief that I have a large percentage of my overall wealth in these stocks and my overall plan is based in large part around this investing strategy.

So, with the 3rd quarter behind us, let's take a look at where I, and the other nine fine bloggers involved, stand. Let's first recap my picks:

Freedom Fund Update - October 2012

Well, the time has come to update the Freedom Fund once again as we start another month. The Freedom Fund is my portfolio, and I think it's aptly named. My portfolio is my way to freedom; freedom from working at a job I don't enjoy to purchase goods I don't need to impress neighbors I don't care about.

I feel extremely fortunate and thankful that I'm able to post these updates every single month which shows the power of monthly contributions to investments because of the high savings rate I maintain. It shows how a relatively large sum of money can be built through the power of time, patience and perseverance.