The holidays are here, and this is my absolute favorite time of year. It means time away from work, and energy spent instead with family and loved ones. It’s a better work/life balance, and one I wish I could acheive more often. I’m flying up to Michigan tomorrow afternoon – if my flight isn’t delayed or canceled. There is some severe weather hitting the middle of the country over the weekend so we’ll see if my travel plans are impacted by that or not.
I’m not sure how active I’m going to be over the next week or so, but I wanted to write this article to leave behind some great reading material and also wish every reader out there a wonderful Christmas and a very happy holiday season. Times like this are why we all continue to work so hard. So jam out to the holiday tunes, eat too much food and exchange thoughtful gifts. Life is short.
Below, you’ll find a short list of articles I’ve recently read and enjoyed. I hope you enjoy them as well.
How Do I Know When To Sell A Stock?
Chuck Carnevale – one of my favorite authors – recently penned this piece on how to properly decide when to sell a stock. While I came to a similar conclusion a while back regarding the criteria that would have to be present in order for me to sell a stock, Chuck’s more verbose piece is much more detailed and nuanced. A very good article if you’re looking for a little more information on it may be a good idea to sell a stock, especially since there is already so much material already out there in regards to when to buy a stock. I’m personally leaning towards selling even less than I do now, which is already quite a rare event.
Church & Dwight (CHD) Dividend Stock Analysis
Passive Income Pursuit put together another detailed analysis, this time on CHD. I personally love the product lineup with this company, but I agree with Pursuit’s conclusion that the valuation just doesn’t make sense right now.
Leveraged dividend growth investing
Dividend Growth Investor discussed the potential possibilities if an investor were to leverage their stock purchases by buying on margin. I personally will never, repeat never, buy on margin. I believe in keeping things simple, and my overarching goal (to be able to retire by 40) is completely achievable without leveraging myself. While I could perhaps amplify my returns, I would also be amplifying my risk. And I think my strategy to keep a 99% or so allocation to stocks as fairly risky already. Increasing that risk via leveraging would be, in my opinion, asking for trouble. Besides, the time to buy on margin was four years ago.
Dividend Growth Investing: Misguided And Doing It All Wrong
David wrote this article in response to the recent backlash regarding the dividend growth investing strategy over at Seeking Alpha. I personally received my fair share of this backlash after one of my recent articles was republished over at SA. I personally find detractors that want you to abandon whatever strategy you’re using to build wealth and join the bandwagon they’re currently riding distracting, discouraging and nothing but noise. I always say stick to a strategy that works for YOU and YOUR GOALS. It doesn’t matter what everyone else is doing, me included. Ignore the noise and focus on what you can control.
Frugal Christmas Gifts for People Who Have Everything
Joe listed some great options out there for the frugal-minded shopper. I personally embrace consumerism for the holiday season, and let go of my frugal tendencies for just a short time. However, this is in the name of compromise and maintaining relationships with loved ones. Besides, it’s just plain fun to give gifts. I’m all about saving money, but doing so shouldn’t be at all costs. Striking the right balance is at times difficult, but we don’t have to be perfect at this. Life is imperfect and messy. The important thing is that you’re on a journey to drastically improve your life via freedom, while at the same time being happy in the now.
Soldier of Luxury
MMM punches us all in the face with another great post. He reminds us that all the fluff of stuff is really unnecessary. If we truly get right down to it we can be happy with very, very little. This post was a bit Waldenesque, and really a delight to read.
If I Were the CEO of A Mega Corporation…
FI Fighter revealed what he would do if he ran a large company. A very entertaining read. While I wouldn’t necessarily want to invest in a company if he ran it, I’d sure run like hell to the application desk and file for a job there immediately. Sounds like a fun place to work! I don’t think I’d be so anxious for financial independence if I had a job at this fictional company.
2014 Financial Goals
Compounding Income shared his goals for the new year. I think these are challenging, but realistic. I’m really rooting for him, and I think his forward dividend income goal of $6,880 is perfectly achievable.
It Is Not All Fun and Roses
While traveling the world certainly has its fair share of perks, Jeremy reminds us that while every day might be an adventure those adventures might not always be the good kind. Glad to hear he escaped this potentially dangerous situation okay. It’s also important to remember that danger is everywhere, and I’ve had my fair share of situations right here in the good ‘ol U.S. of A.
Living As Young Expats in Chiang Mai, Thailand
Chris and Angela relate their daily lives in respect to living halfway around the world. What’s even more unique about their lifestyle is that they’re doing it at such a young age. I find their decision to take on challenges inspiring and their optimism encouraging. Not to mention that they’ve attained freedom at a very young age. I’ve often thought about living in abroad in a cheaper country once I’ve attained financial independence, and Thailand is usually at the top of the list because of its great food, favorable climate, attractive cost of living and large base of expats.
Thanks for reading.
Photo Credit: Benoit Mahe
LOL! I wouldn’t want to own stocks in any company I was running either… I would short it down to zero, instead… but I can guarantee you we’d have a lot of fun at “work”! 😉
Thanks for the mention and have a great weekend!
Thanks for the list Jason. Chuck is an outstanding author. I often enjoy his pieces. Have a great trip. In your absence I’ll try to convince FI Fighter that he wouldn’t make such a bad CEO. LOL
Jason,
I note your comment related to the “Leveraged Dividend Growth Investing” article. NEVER is a pretty strong term. What if your circumstances in the future are different from today? What if the market tanked thereby resulting in glorious buying opportunities, a low interest rate environment, and your existing dividend income is sufficient to support your frugal lifestyle and the debt service (including loan repayment)? Would you change your tune?
NOTE: I am not talking about a margin loan where you borrow against your investments. I am not a big fan of that concept for, what I think are obvious reasons.
Hey, I am totally with you when it comes to debt but if the stars line up at some point down the road, don’t totally rule out a PRUDENT amount of debt to capitalize on opportunities.
What is a PRUDENT amount of debt? I don’t think there is any correct answer as everyone’s circumstances are unique. A good start, however, would be an amount where you can put your head on the pillow at night and you quickly fall asleep. If even a small amount of debt relative to your cash flow and net worth will make you lie awake at night, then the correct amount might be NO debt.
Wishing you and all your readers a very Merry Xmas and a Happy New Year! For those who may not celebrate these holidays…all the best during this holiday season.
If any of you are travelling, as is Jason, safe travels!
….and to one and all, a happy and prosperous 2014!!!!!!!
Cheers.
Chuck in Ontario
FI Fighter,
Hell yeah. We’ have a ton of fun at work if you were running the ship! I think I could even put off FI for a while. 🙂
I hope you have a great weekend as well, and a merry Christmas!
Best regards.
Bryan,
Chuck is indeed a wonderful writer. His pieces are inspiring.
Thanks for the well wishes. I hope you get to spend some time with the family! 🙂
Best wishes.
Chuck,
They say never say never. I’ve not necessarily followed that advice and done well so far. For instance, people thought I would change my mind on my vow to never have children or get married and I’m 31 and going strong.
I hear you on a prudent amount of debt. I’m old school, I guess. I abhor debt for the most part. I now only carry student loan debt, and I’m paying that off one month at a time. As an investor, I understand that it’s all about the cost of capital, and if you can make money on debt then gearing is a good thing. However, what I’m comfortable with in an investment and my own personal balance sheet is different. I’m quite confident I can accomplish my goals without resorting to leverage or margin, and as long as that remains true then I’ll continue as is. After all, it’s impossible to go bankrupt if you don’t owe anyone anything.
Wishing you a very merry Christmas and a happy New Year as well!! 🙂
Take care.
Thanks for the mention and I hope you have a great time up in Michigan with your family. Try to stay warm as you’re body is used to those sunny and 75 winters down in Florida.
Jason
Thanks for your inspiring blog, as a result my choice of investment style has been confirmed as growing income by re-investing in secure, strong, companies who’s products are likely to be in demand through good times and bad. You have also inspired me to start my own blog to comment on this style of investment in the UK.
I hope your journey continues to be successful, as I continue to observe via your blog, and hope to emulate your success (not quite as dedicated to frugal living as you are so my journey will be longer than yours).
Wishing you a great holiday period with your family and loved ones
All the best from Puerto Vallarta. My mini Christmas tree has a margarita glass for it’s base but it is still festive. Have some family joining me here for the holidays but I think it might be the beach & Coronas that is their real reason for coming…lol. Anyway, would be curious on your assessment of LIQ on the TSX which controls a number if liquor outlets in Canada & the States & has a yield of 7.80 & has come down in price as of late. Might be interesting.
Since today I also now have two weeks of vacation!
I am very happy!
And next year I´ll be working hard again!
I’m looking forward to April 2014.
Then I can order a new company car!
With a little luck, an Audi A6 3.0l – 204HP 🙂
http://goo.gl/CIS52U – a fucking great car! 😉
Best regards!
D-S
A nice round-up. I also liked Chuck’s article on when to sell a stock. I have a similar view on margin as you — I have no intention of using it because I think it adds unnecessary risk. More generally, I am pretty adamant about not borrowing money to invest.
I remember seeing the backlash that you received on that SA article and I also read the more recent misinformed critiques of dividend growth investing at SA. Stuff like that degrades the SA experience for me; I am fine with reading a well-reasoned critique, but blatantly incorrect and unsubstantiated critiques really irk me.
Ha, if I had my own company I would likely make people work hard. I would only hire people that like what they do however, and working=fun for them.
Thanks for listing my article. I use margin from time to time, when I find a bargain I can’t resist, but I would get the actual cash in say 5 – 10 business days. That is how I bought more YUM this year.
I think it is important to know the tools available to you as an investor, and to act accordingly. Some readers especially on SA were pissed off, because they thought I was telling them to go to margin today. Margin is a more complicated topic and is riskier, which is why for the majority of investors out there it is dangerous. But for others, it could be a solution. It is nice to know you can borrow against your asset, but that doesn’t mean you have to do it. But things happen… It pays to have options.. It is just very sad when I see readers who fail to think multi-dimensionally..
For example, some readers were unhappy when I used saving $3K/month in dividend stocks in an example. They thought it was too high. Then I used an example where I discussed buying $200 worth of stock using Sharebuilder, and people were unhappy with that also.
This is why I never really pay much attention to comments – someone is always going to disagree with me, no matter what I do. Hence, I should stay true to myself, and do what I need to do.
Anyway, happy holidays Dividend Mantra!
DM
While you took out your student loan to pay for college, you have stated that due to the low rate/ and tax deduction you would prefer to pay it out over time, when you have the means to pay it in full. In fact, you are using a small amount of leverage if you think about it.
Happy Holidays
Scott
Couldn’t resist giving you a pat on the back for this comment, DGI! Well said!
DGI,
I’m on the same page as you. Paying attention to negativity within the peanut gallery will only distract you from accomplishing your goals. However, I’m really lucky in that most everyone I’ve been in contact with as a result of this blog has been overwhelmingly positive in their support for me and my journey. In fact, I would go out on a limb and say this blog, and the discussions that arise within, has been instrumental in my success thus far.
But I completely agree with you on staying true to yourself. I couldn’t have said it better myself! 🙂
Happy holidays to you too. I hope you have a wonderful time!
Best regards.
D-S,
Nice car! As you probably know, I work at an Audi dealership. I get to see those cars every day. They’re making a really great car right now. They just don’t really break anymore. Most of the work we do is just regular maintenance. I hope you’re able to land the A6. 🙂
Enjoy your vacation! Sounds like you’ve worked hard for it.
Best wishes.
Pursuit,
It’s about 30 degrees here right now, with ice everywhere. I was actually supposed to visit my best friend today and meet his new baby, but the roads are too dangerous. It’s definitely different than Florida – it’s about 80 in Sarasota today. 🙂
I hope you get to see the family and get a break for the holiday.
Take care.
FI UK,
Thanks for the kind words. I’m glad you found some inspiration in the blog and what I’m doing. That’s the main reason I write.
I hope you’re able to continue seeing success with your journey. I promise that while this strategy isn’t a get-rich-quick scheme, you will become wealthy over time. Keep up the great work!
Wishing you a wonderful holiday as well!
Best wishes.
Anonymous,
Glad to hear you’re still doing well down there in Mexico! I hope you have fun with the family. Spending the season together with a beach and a Corona doesn’t sound bad at all! 🙂
As far as LIQ goes, it just doesn’t appeal to me with a static dividend and a high payout ratio. Could be a fantastic investment, but it just doesn’t fit within the criteria I typically use.
Enjoy yourself down there in PV! Merry Christmas.
Cheers!
DGM,
I’m with you. I think you put it nicely when using the word “unnecessary”. That’s how I feel as well. Margin isn’t necessary for me to accomplish my goals, and I also feel the same about borrowing money to invest in more general terms.
I see where SA is coming from regarding the articles that go back and forth. I suppose it generates traffic for them and what not. However, as you know from the content here I generally don’t involve myself in the arguments. I’m not selling anything here, and that goes for both investments and strategies. I simply aim to inspire others who aspire to similar accomplishments.
Enjoy your holidays!
Best regards.
Scott,
I guess based on a technicality I’m using leverage, however I’m simply paying back debt that my younger self stupidly took on. I’m not actively engaged in leveraging myself, and not borrowing to invest. I wouldn’t compare old student loan debt to margin, and I’m in a much different place now than I was 14 years ago.
Happy holidays to you too!
Best wishes.
Hi Jason,
Saw your profile on USA Today and I’m always amazed at the savings rate that you can achieve. Have you ever considered buying a duplex and renting the other half out, in some cases carrying your mortgage. I live in Hawaii and we have the most expensive home prices, I rent downstairs of my two story house out to help reduce my housing cost.
Merry Christmas Jason
Don’t get in any bar fights in Michigan 😉
Thanks for the articles. Nice readings!
Have a great holidays!
DM
I made the comment about your student loan payout. Why beat yourself up over borrowing cheap money to get a college education? While in retrospect maybe you would have been a more serious student , or you might not have taken on as much debt and worked to put your self through, you have something that can never be taken from you. It is clear from your writing ability and stock analysis that you learned something! I took my daughter to an event for new admits and alums. They asked the alums what their entering major was, what their graduating major was and what they were doing now. The responses were amusing as almost no one graduated with the major they entered with and the jobs/professions were not directly related to the graduating majors.
Scott
Charles,
Thanks for stopping by!
I’ve considered the duplex idea, but at the same time I’ve never had a desire to become a landlord. I know that living on one side would be the easiest way to become a landlord, but I’ve been hesitant to that. I quite enjoy renting cheaply and having any headaches/repairs subsidized for me.
Hawaii seems incredibly expensive, but also incredibly beautiful. I’d love to see it one day. I live in Florida now because I enjoy tropical weather, but it’s nothing like Hawaii. Enjoy paradise. 🙂
Cheers!
Jeremy,
Haha! If I do, I’ll just weave and dodge like you. Seems like the best strategy. 🙂
Merry Christmas to you guys, too!
Best regards.
Trader,
Happy holidays! Hope you enjoy the season. 🙂
Take care.
Scott,
I beat myself up because I didn’t graduate college. I worked my way through college, but the income still wasn’t enough for tuition, books, rent, etc. So I took out loans. However, not only did I not finish school, but I also inherited money at 21 and didn’t pay off my loans. I call my younger self stupid because he was. However, it just goes to show that if I can overcome student loans with no degree and a blown inheritance than anyone should be able to accomplish their own dreams as well. I persevered through it because I learned from my mistakes and I knew I could do more. However, I can also see how some people give up. I hope that this blog encourages and inspires those that think giving up is the right choice. It’s hard work to overcome challenges and mistakes, but the rewards are great. I’m proving that every single day. 🙂
Best regards!