What Are You Buying?

As we end the month of November, and move into the full swing of the holiday season, I thought now would be a great time to ask you readers what equities are on your shopping list. I look forward to receiving a healthy chunk of fresh capital from my day job early next month. I plan on continuing to scan the market for attractively priced entry points to quality dividend growth stocks for the long-term.

For now, I do have a few stocks that are pretty high on my shopping list. If Santa has a "naughty or nice" list, the following stocks are definitely "nice" for my portfolio.

As I take a look at my portfolio, and as it grows to larger portions month after month, I have to keep proper allocation in mind and make sure I'm not over-allocating to any one company. For instance, I find Intel Corporation (INTC) very attractively priced right now at the $20/share level. However, I already have a fairly large allocation to this one particular company, and if unfavorable conditions were to force them to cut their dividend this could cause outsized disruptions to my dividend income. So, I'm not sure I want to add to that position right now even though it's trading for more than 10% below my cost basis. When my portfolio was smaller, allocation didn't matter as much. Also, technology stocks in particular frighten me a bit due to the ever-changing nature of their industry. However, INTC is on my list for a potential purchase since it's significantly undervalued by almost any measure.

I'm listing below some attractively priced dividend growth stocks that I believe offer the long-term investor an opportunity for intelligent allocation of capital. If market conditions change rapidly over the next couple weeks, then this shopping list could change accordingly.

Recent Dividend Increases

As a dividend growth investor, one of the primary objectives I seek is passive dividend income from my investments that increases over the rate of inflation, annually. It's always wonderful news when companies decide to reward loyal long-term shareholders with a dividend raise. Some recent dividend increases include:

Happy Thanksgiving Everyone!

Just wanted to drop a note to all my readers out there. Happy Thanksgiving!

I hope everyone is getting the opportunity to spend time with loved ones, as that's what I'm most thankful for. Of course, the journey to early retirement, being employed, living in 21st century America and good health are all also things I'm very thankful for as well.

I'm also very thankful to all my readers. Thank you for continuing to follow my journey and support Dividend Mantra!

I look forward to being able to gobble till' I wobble tonight, as well as fitting in some football.

May you enjoy your Thanksgiving!

Thanks for reading.

Photo credit: FreeDigitalPhotos.net

Walking The Path

Knowing how to build wealth is relatively common knowledge. It doesn't take a rocket scientist to figure out that spending less than you earn and investing the difference will lead to substantial assets over time. However, there is a significant difference between having this knowledge and knowing the path before you, and actually walking that path.

I'll give you a quick rundown on what an average weekday looks like for yours truly.

Scooter Redux

My New Ride!

I previously wrote about how I loved having a scooter as a primary transportation option. The gas mileage is crazy good with these little 2-wheeled vehicles and they are super cheap to own and operate. Owning a car definitely has its own set of benefits, but I feel that the drawbacks are too high to overcome at this point in my life. Simply put, I'm looking to maximize every single dollar I earn as I aim to achieve financial independence before 40 years old.

Unfortunately, I sold the scooter listed in the hyper linked article above. I had an incident on the road that left me wondering about my own safety. I regret selling it now, as getting rid of the scooter was a bit of a knee-jerk reaction on my part. At the time I was riding the scooter almost everyday to work and using it for trips to the grocery store, along with other errands that would come up. I have since come to realize that I was riding the scooter too much, instead of using it for what its intended purpose was: to provide an alternate way to get to work when the bus ran late.

Recent Buy

I've been particularly active in the market as we've continued to see drops in all the major indexes on a daily basis. I've injected quite a bit of fresh capital into my portfolio over the last week or so, and perhaps I made those moves a little early. But that assumption really depends on your perspective. I look at every share I purchase in a publicly traded company as an additional piece of ownership, because that's essentially what stocks are - pieces of ownership in a business. So, I'm simply buying a percentage of future profits with today's money, and by doing so I'm delaying gratification in exchange for a return on my money. Obviously, the cheaper each share is the better off I am as I can then purchase a larger percentage of a business for the same amount of money.

However, what I really tend to look at is future expectations. If you buy shares in McDonald's for $86.08 a piece, as I did recently, or if you buy them for today's closing price of 84.05 will it really matter all that much 20 years from now when MCD shares are available on the market for $700 each? Probably not. That's not to say that I don't believe that purchasing stocks on a strong value basis isn't important. Quite the contrary, as I believe valuation is paramount to a dividend growth investor's long-term success and total returns. I just don't think an individual investor should hang their head low because a stock they purchased dips multiple percentage points soon afterward. I advocate purchasing quality companies at attractive long-term prices, not trying to time the market. Time, not timing, will always be your best friend as a long-term value-based dividend growth investor.

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.

Income/Expenses For October 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).

Recent Buy

Wow. How about that election? Obama gets re-elected and the market has a three-day performance that has me grinning ear to ear. The Dow Jones Industrial Average is down some 430 points (or 3.25%) over the last three trading days. That sounds like opportunity to me. It just so happens that I received my monthly commission check from my day job this past Thursday, which was great timing! I promptly transferred this fresh capital over to my brokerage account in the morning to get shopping.

Although a 430 point drop isn't a major stock market correction, as always I like to look at equities on an individual basis. As such, for my recent purchases I tried to target dividend growth stocks that have experienced particular weakness lately. I found a few quality companies whose shares have been beaten down lately due to macroeconomic events, rather than company-specific issues and so I decided to get busy buying.

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 Dividend Increases

As a dividend growth investor, one of the primary objectives I seek is passive dividend income from my investments that increases over the rate of inflation, annually. It's always wonderful news when companies decide to reward loyal long-term shareholders with a dividend raise. Some recent dividend increases include:

Guest Post: What If You Could Not Sell Your Stocks?

This is a guest post written by Dan Mac. Dan is an investor and writes about his favorite strategy at Dividend Growth Stock Investing.

Last week the New York Stock Exchange was forced to shut down due to Superstorm Sandy. If you wanted to buy or sell US stocks during this time you would not be able to. While the market was only closed for two days, it got me thinking about how comfortable I would be with my stock portfolio if the market ever closed for an extended period of time and I were unable to sell any of my holdings. Usually the New York Stock exchange tries to avoid closures and they do a very good job of staying open. The longest closure in history was in 1914 when you would not have been able to trade stocks for 137 days. The market was closed to stock trading from July 31, 1914 through December 15, 1914 due to the outbreak of World War I.

Ignore The Noise

I thought with Election Day upon us, and the fate of the White House for the next 4 years here, now would be a good time to talk about something extremely important: ignoring the noise.

What is "noise", exactly?

Pretty much everything out there that's trying to distract you from reaching your long-term goals. It's almost everything that's short-term in nature, that will really have minimal net effects on your success over the long haul.

Dividend Income Update - October 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.

Another great month of passive income. Every dollar that I receive in dividends is one more dollar I have available to me to pay obligations and one less dollar I need to earn at my full-time job that takes up way more of my time than I'd like. Owning high quality companies for the long-term is rewarding in many ways, and the dividends they pay to loyal shareholders is just one of those great rewards.

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:

Freedom Fund Update - November 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.