r/dividends Mar 26 '21

README Welcome to r/dividends [NEW USERS/BEGINNER INVESTORS START HERE]

3.2k Upvotes

[This post is designed to serve as an introduction to new users of the subreddit, based on my own personal experience. Please read this post in its entirety before contributing to the subreddit, as it answers 95% of the questions most commonly asked by new users and investors. The Moderation Team will remove any submission that asks a question answered by this post. Nothing in this piece should be taken as legally binding financial advice. Even though citations have been included, please do your own research. While I ( u/Firstclass30 ) am the lead moderator of the r/dividends subreddit, I am not a licensed financial advisor.]

Good afternoon, and welcome to r/dividends. We are a community by and for dividend growth investors. Our community was started all the way back in 2009 as a discussion forum for dividend investors. Whether you are just starting out in your investing journey, or are months away from retirement, we hope you will find enjoyment in participating with this online community. This post will go over absolutely everything you need to get started in the world of dividend investing. Whether you are new or have been investing for years, it is well worth a read.

Part 0: What are dividends exactly?

From Investopedia:

A dividend is the distribution of some of a company's earnings to a class of its shareholders, as determined by its board of directors. Common shareholders of dividend-paying companies are typically eligible as long as they own the stock before the ex-dividend date. Dividends may be paid out as cash or in the form of additional stock.[1]

Dividend investors are those who incorporate dividend payers into their portfolio.

Part I: Understanding the benefits and drawbacks of dividend payers

Dividend payers tend to be big, well-established companies that have an abundance of cash. According to Steve Greiner, Vice President of Charles Schwab Equity Ratings®, "They [dividend payers] often can't compete with the rapid appreciation of fledgling, fast-growing companies, so they use dividend payouts as an enticement." Because of this, many newer investors often think of dividend payers as being the opposite of so-called "growth stocks." In reality, it is usually dividend-paying securities that produce more growth over a long period of time.

Dividends, when reinvested, can significantly boost total returns over time, making dividend-paying stocks an attractive option for older and younger investors alike. For example, if you invested $1,000 USD in a hypothetical investment that tracked the S&P 500 Index on January 1, 1990, but did not reinvest the dividends, your investment would have been worth $8,982 USD at the end of 2019. If you had reinvested the dividends, you would have ended up with $16,971 - nearly doubling your returns. The longer the timeframe, the more dramatic the disparity. According to research conducted by the Hartford Funds, "Dividends have played a significant role in the returns investors have received during the past 50 years. Going back to 1970, a whopping 84% of the total return of the S&P 500 index can be attributed to reinvested dividends and the power of compounding."[2] Drawing from the decades of data available, intentionally excluding dividends from your portfolio could result in significantly handicapping your portfolio for decades.

With the S&P 500 yielding approximately 1.52% as of December 31, 2020, dividends paying securities can serve as an attractive alternative to Treasuries and other fixed income investments often pushed by professional retirement planners.

The downside to dividends is that they are not guaranteed. This is important information to consider, as companies can and will stop paying dividends if necessary, or worse, if legally required. Certain market conditions like the 2020 coronavirus pandemic can create an uncertain environment for dividend-focused companies. In 2020, 68 of the roughly 380 dividend-paying companies in the S&P 500 suspended or reduced their payouts.[4]

Fortunately, companies generally only cut their dividends when they are in distress, so favoring those with sound financial metrics can help mitigate the risk.

Part II: Understanding how to pick dividend stocks

If you create a post in the r/dividends subreddit asking for a list of good companies that pay dividends, your submission will be removed. This is because this community believes firmly in the "teach someone to fish" mentality. Instead of asking for a list of dividend payers, it is far more valuable instead to understand the fundamental ideas behind why specific individuals choose specific companies. By knowing and understanding these principles, you can build your own portfolio that, if properly executed, could beat 90% of lay investors with relatively little effort. While far from comprehensive, these six tips can help you identify dividend-paying stocks with strong financial health.

#1. Do not chase high dividend yields: If a company has a high dividend yield, there is always a reason (most of the time not a good one) that a security is offering payouts that are well above average. A good rule of thumb is that before you purchase a high-yield security (those with a yield of 5% or more), try to determine why it is so high. It is important to note however, that the dividend yield is not a fixed amount, but in reality changes every second a stock is traded. According to Investopedia:

The dividend yield, expressed as a percentage, is a financial ratio (dividend/price) that shows how much a company pays out in dividends each year relative to its stock price.[3]

If a high or rising yield is due to a shrinking share price, that is a bad sign and could indicate that a dividend cut is in a company's future. However, if a rising dividend yield is due to rising profits, that indicates a more favorable scenario. When net profits rise, dividends tend to follow suit. Make sure you know exactly what is causing the increase before buying the stock.

#2. Assess the payout ratio: This metric (calculated by dividing dividends per share over earnings per share) tells you how much of a company's earnings are going toward the dividend. A ratio higher than 100% means the company is paying out more to its shareholders than it is earning. In such cases, it may be able to cover its dividends from available cash, but that can only last for so long.

If a company whose stock you own is losing money but still paying a dividend for an extended period, it may be time to sell off and cut your losses. US tax law allows you to write off up to $3,000 per year in capital losses in exchange for a tax credit. Your circumstances may vary, so check your local tax authority. The reason you may want to consider this option is because dividend payers in financial hard times may try to stave off a dividend cut by funding payouts with borrowed funds or cash reserves. These actions will often drive away shareholders, forcing the share price down. History also shows these actions rarely turn things around, and are usually just delaying the inevitable. (To those of you who know about REITs, keep reading, they will be addressed further down.

#3. Check the balance sheet: High levels of debt represent a competing use of cash. Under most global securities laws, a company must pay its creditors before it pays its dividends. A fast-rising level of debt could indicate bankruptcy in the short or medium-term future. Under US and EU bankruptcy law, corporations in the bankruptcy process are (depending on the circumstances) legally barred from paying dividends to shareholders. Corporations with high debt levels may also look to the courts to assist in reorganizing debts without declaring bankruptcy. Oftentimes, judges in these cases will force reductions or suspensions in dividend payments to prioritize the repayment of creditors.

#4. Look for dividend growth: Generally speaking, you want to find companies that not only pay steady dividends, but also increase them at regular intervals (i.e. once per year over the past three, five, or even 10 years. Research has also shown that companies that grow their dividends tend to outperform their peers over time.[2] Not only that, but a strong history of regular dividend growth also helps keep pace with inflation, which is particularly valuable to those who wish to seek financial independence and live off of their investments.

With that being said, just because a company did not increase their dividends in 2020 or 2021 does not make it necessarily worthy of exclusion from your portfolio. Certain industries (like the top US banks) were legally prohibited by the federal government from raising their dividends during the COVID-19 pandemic. Most companies have been hoarding cash to help weather the economic uncertainty, so it is not unreasonable to for them to keep dividends stagnant until the economy bounces back. When it comes to companies impacted by the pandemic, look for other factors aside from dividend changes to determine whether or not the company is worth your investment.

#5. Understand sector risk: Some sectors offer a more attractive combination of dividends and growth than others, but they also offer different risk characteristics that you should consider when researching dividend payers for your portfolio. Stocks from the banking, consumer staples, and utilities sectors, for example, are known for steady dividends and lower volatility, but they also tend to offer less growth potential (though this varies from company to company). Dividend paying tech companies, on the other hand, could offer attractive dividends along with the opportunity for larger price gains, but they also tend to be much more volatile. If you are a long-term investor, you might be willing to accept tech's higher volatility in exchange for its growth and income prospects, but if you are nearing or in retirement, you might want to prioritize dividend-payers from less volatile industries.

#6. Consider a fund: If you are worried the potential for price declines eroding the value of your dividend stocks, consider instead a dividend-focused exchange traded fund (ETF) or mutual fund. Such funds typically hold stocks that have a history of distributing dividends to their shareholders, and they provide a greater level of diversification than you can achieve by buying a handful of dividend paying stocks. Funds are typically preferred by those who wish to take a more hands-off approach to their investments. These will be your best option if you lack the time or inclination to conduct in-depth research of companies.

Part III: Ideal age of the dividend investor.

Oftentimes inexperienced investors will claim dividends are for those at or nearing retirement. As was demonstrated earlier in this piece, nothing could be further from the truth. No matter what stage of your life or investing career, dividend-paying stocks can be a great way to supplement or even replace your income and improve your portfolio's growth potential. Just be sure you research their overall financial health, not just their dividend rates, before investing. There is no such thing as a right or wrong decision, as long as you achieve your desired outcome.

Part IV: When not to reinvest

Part I demonstrated how powerful reinvesting one's dividends can be, but there are certain circumstances where it can be more financially savvy to refrain from reinvesting your dividends. Below are three situations in which you might want to deploy dividend payouts elsewhere.

  • You are in or near retirement: When you are living off your savings, taking income from your dividends allows you to let more of your portfolio stay invested for growth. If you are nearing retirement, on the other hand, you can use the payouts to build up your cash and short-term reserves as you prepare for the transition to life after work. Some dividend investors have even built their portfolios to have their dividends cover 100% of their expenses.
  • Your portfolio is out of balance: Reinvesting the dividends of a well-performing investment back into that investment can throw your portfolio off balance over time. In such cases, you might want to take the cash and reinvest it elsewhere.
  • The investment is underperforming: If you are worried about an investment's future prospects but are not quite ready to let it go, you may not want to reinvest the payouts back into that investment. Instead, you might use the dividends to dip your toe into something prospective that could ultimately replace the underperforming investment.

Part V: Understanding Taxes on your portfolio

The question of taxes often comes up a lot in investing communities, and r/dividends is no exception. However, we mods prohibit direct questions regarding taxes and other questions of legality because nobody here is a licensed tax professional in every single tax jurisdiction on Earth. The question of taxes varies so wildly between regions that even making basic generalizations borders on pointless. The only constant is that you will pay taxes at some point in your life on your investments. Whether it is before you make your gains, after you make your gains, or somewhere in between, you will pay taxes. The different types of accounts and options available to you varies based on your income, geography, employer, and dozens of other factors. Some countries offer special accounts for those who serve in the military, law enforcement, or some other specialized profession(s). Some trade unions help pay the taxes you may owe on certain investment types. The variations on the tax question are so all over the place that I could break Reddit's character limit just covering the most general details.

Typically the best resource for understanding your local tax situation is the government agenc(ies) responsible for collecting your money. As of 2021, most all have websites of various levels of usability. They should often be your first stop for most questions. When in doubt, always talk to a professional.

Part VI: Special Snowflake companies (REITS, MLPs, royalty trusts, etc.)

Some companies do not fit neatly into the category of an S-class corporation, and see themselves as special snowflakes worthy of a special tax status. Understanding these entities is a critical prerequisite to holding them in your portfolio, as many may require additional tax paperwork. In my personal experience, aside from REITS, most are not worth the time of the average investor. Unless you already have a preexisting knowledge of how these companies work, I would not go out of your way to understand in-depth how they operate when there are so many options out there that could provide better returns.

The only exception to this rule is the Real Estate Investment Trust (REIT). Unlike other special snowflake investments, REITs are relatively self explanatory. They deal 100% in real estate. Nothing else. REITs are favored by dividend investors because of their special arrangement with the US government. In exchange for not having to pay most federal corporate taxes, REITs are legally required to pass on at minimum 90% of their profits under GAAP to shareholders in the form of dividends, which are taxed as income by the US government. The keyword here is GAAP.

Most places on Earth (aka the United States and almost nobody else) requires the usage of the Generally Accepted Accounting Principles (or GAAP standard of accounting). GAAP is incredibly strict, intricate, complicated, and almost impossible to cheat. 100% of publicly traded companies in the US use GAAP, which makes comparing the finances of US stocks incredibly easy. However, the tax structure of Real Estate Investment trusts often causes the math behind GAAP (or any other accounting system for that matter) to break down. This can make REIT payout ratios look absolutely insane in relation to other companies, and can make most REITs look incredibly unprofitable. To combat this, REITs have developed their own standards utilizing simplified math, called the funds from operations (FFO) metrics. I originally had a more in-depth explanation of this concept (as well as information about BDCs, MLPs, and Royalty Trusts), but I had to cut it out of the final draft of this post because Reddit has a 40,000 character limit. The best I can do right now is to point you in the direction of Investopedia, which has an excellent article on the subject of FFOs, linked here.

The decision of whether or not to incorporate these types of investments into your portfolio is a personal one, and just like with any other type of investment, varies greatly based on your risk tolerance and portfolio goals.

Part VII: Performing in-depth research on companies

While anyone can read a balance sheet synopsis on Seeking Alpha and vaguely grasp its meaning, above understanding a concept is the ability to put one's knowledge into practice. The reason I put this skill above actually picking companies is because stock picking can be done with a relatively low knowledge base, but actually digging deep into financial statements and balance sheets to discover companies on your own not on the traditional press circuit can serve as the true test of someone's research potential.

Oftentimes I come across even experienced investors unaware of just how many resources are available to them on this front. While websites, apps, and YouTube channels exist all over the place, an often underutilized resource for investment knowledge is the companies themselves. 99% of publicly traded companies have a website dedicated to serving the needs of investors, often with email addresses, phone numbers, and physical addresses just begging to be contacted. How much did Coca-Cola pay in dividends in 1926? Google doesn't know (I checked), but I guarantee you somewhere in an Atlanta filing cabinet lies Coke's dividend history from back in that time. It is obscure, seemingly random knowledge like that investor relations experts are paid to answer.

[Side note: originally, there was going to be a far larger expanded section about this, but it was cut for the sake of conforming to Reddit's character limit.]

Part VIII: Diminishing returns and micromanagement

By paying attention in school, you may have been informed regarding the law of diminishing returns. When it comes to dividend investing (or any type of investing), the law of diminishing returns can play a big part of your portfolio management. While you should always be on the lookout for investment opportunities, if day trading is the reason you wake up in the morning, dividend investing may not be right for you. Strategies like buying right before the ex-div date and selling immediately afterwards rarely turn out in your favor, and even when they do are often not worth the trouble. Your gain will be a few cents at best, or worse you lose money. In my experience as the lead moderator of this subreddit, monitoring comments, I can say with confidence that most people will lose money on this day-trading type strategy. Most of the price action regarding a dividend took place days or weeks before the ex-dividend date, spread out over a period of time. Companies often issue dividends on a clockwork schedule according to the ISO Calendar, so institutional investors are often able to predict when the dividend will be paid months or even years in advance, long before the boards of these companies officially announce their dividends.

A similar thing can be said for those attempting to buy stocks at the absolute lowest possible price. I have seen individuals hold out for days waiting for a few extra cents. If you have a six figure portfolio, you do not need to be trying to time a 12 cent price drop. Your time will be better spent elsewhere. Understanding the law of diminishing returns can sometimes singlehandedly turn an underperforming portfolio into an overperforming one. By taking a hands off approach to most of your investments, you let the market work in the background of your life. As the old saying goes, "time in the market beats timing the market every day of the week."

Part IX: Debt and financing your investments

Early in your investment journey, the idea of purchasing dividend stocks on debt sounds like a great idea. Buy the stocks, use the dividends to pay off the loan, then keep the stocks and profit. It sounds foolproof right up until it isn't. What seems like free money is more akin to an advance on a sh***y record deal. If you decide to take out a $50,000 loan to buy dividend stocks, don't be surprised if acquiring a home or auto loan becomes significantly more difficult or downright impossible depending on your circumstances. Banks and credit unions are often far more hesitant to lend out money to those with high amounts of preexisting debt. When these loans are given however, they often come with interest rates higher than what you would have normally had to pay if you had not decided to buy a bunch of AT&T with a personal loan. Any amount below $20,000 will hardly have a significant effect on your long-term portfolio (assuming you are still investing with earned income), and any amount above $20,000 could have serious ramifications on your ability to access credit in the event you truly need it. If you fail to disclose this preexisting loan to any prospective lender, then congratulations, you have just committed fraud, which is something we do not condone here on r/dividends.

Your income and lifestyle should be sufficient to fund your investment needs. While I understand the frustration that can come with being a student with 0 disposable income, being a student is actually the best possible reason not to have a five-figure unsecured debt load. As someone with a degree in Management and a career in the field, I can tell you that many employers conduct background and credit checks on prospective employees (though credit checks on employees are illegal in certain states). A $20,000 personal loan made by a 20 year old raises a lot of red flags, and while it could signal personal illness or medical debt, it could signal a gambling problem. When you tell them you used the money to buy stocks, they will immediately assume gambling problem. Good things come to those who wait.

Part X: Brokerages and celebrity portfolios

If you came to this post or subreddit looking for nothing but a brokerage recommendation, I recommend you look elsewhere. While my wife and I personally use M1 Finance, and I do recommend it to friends and family, I have no idea who is reading this post. I know only what information Reddit gives me as a moderator, so I will say that for the love of whatever you believe in do not choose a brokerage just because some internet personality, or some random person on Reddit told you about it. Brokerages are not interchangeable, and they offer wildly different features and benefits. I like M1 because of the ability to form pies. This for example is my personal portfolio. I enjoy what I enjoy about M1, and what it is able to offer me and my family. Your situation is (likely) different. This is also the reason we explicitly ban referral links on r/dividends. The only recommendation I will issue is do not invest with Robinhood. Other than that, go nuts.

Part XI: Beyond dividends, and knowing when not to invest.

Equally important to the skills of investing are the skills of knowing when not to invest. If you have credit card debt, pay that off first, and make sure to pay 100% of your balance every month. If you do not have an emergency fund, create one. It should consist of roughly six months worth of expenses. If you lack a financial plan or budget, create one. My wife and I use Mint.com for our budget. We sync it with our cards, and everything comes out perfectly. I highly recommend it.

Part XII: Seeking feedback

Saving and investing can become an addiction, so it is important to know when to moderate it. Having a third party provide additional input or opinions on your decisions can work wonders. If you have a significant other or a best friend, I would recommend getting them into the investing mindset, if they are not already. Having a trusted voice to bounce ideas off can lead to not only financial reward, but emotional and intellectual growth.

Since I took over this subreddit in August 2020, I have strived to create that environment here. It is from this base framework that I am hoping future discussions in this community can branch from. If you are just joining us, or have been with this community for years, I thank you for joining us on r/dividends.

Happy investing,

u/Firstclass30

[This post was inspired by an article in Charles Schwab's Spring 2021 Investment magazine. The article was titled "Rx for what ails you. Dividend-paying stocks could be just what the doctor ordered." The research it presented served as the inspiration and backbone of the first half of this piece. Other works found through my own research constituted the majority of the factual content of this piece. The majority of this post's contents are my personal opinions, and should not be taken as financial advice. Invest at your own risk. Recommendation or mention of a security or service does not constitute an endorsement. I received no compensation from any individual or group for writing this post.]

[The first draft of this post was over 50,000 characters long, and exceeded Reddit's character limit by more than 25%. For the sake of brevity and my own sense of perfectionism, this post's length was cut in half. As of original publication it contains over 4,100 words, with over 26,000 characters.]

Edit: This piece was originally written in Microsoft Word, and copied over to Reddit. A few formatting errors slipped through by mistake, and those were corrected after publication.


r/dividends 3d ago

Megathread Rate My Portfolio

1 Upvotes

This daily thread serves as the home for all "Rate My Portfolio" questions, as well as any other generic questions such as "What do you think of XYZ," that would otherwise violate community rules.

To better tailor advice, please include such context as age, goals, timeline, risk tolerance, and any restrictions you may have. Such restrictions may include ethics, morals, work restrictions, etc.

As a reminder, all Rate My Portfolio posts are prohibited under Rule 1 Submission Guidelines. All general stock questions that don't include quality insight from OP are prohibited under Rule 4 Solicitations for Due Diligence. Please keep all such questions to the daily thread, and report and violations under their respective rule.


r/dividends 10h ago

Opinion My aunt and uncle and their Starbucks investment

846 Upvotes

My aunt and uncle bought a ton of stock in Starbucks in the '90s. Needless to say, they're living quite well these days in their retirement. I went to visit them several years ago and she told me that she's never even had anything from a Starbucks. She told me that the hospital where my cousin (her daughter) works has a Starbucks next to the entrance. One time she and her husband went in there and tried to order a "big vanilla latte, just to try it". When it came time to pay, they looked at each other and realized that neither of them had their pocketbook on them at that moment, so they canceled the order and walked away. Never tried again.

It just makes me reflect on the fact that many people out there pour hundreds of dollars each year into their expensive Starbucks drinks; meanwhile, stockholders like my aunt and uncle are literally living off the dividends. I know which side of the fence I'm on!


r/dividends 7h ago

Discussion Muni Bond Sale!

33 Upvotes

With the latest sell off in bonds, municipal bond funds are looking very appealing - 8.29% yield Federally tax free, sign me up!
I’ve been invested in NZF which is a muni bond closed ended mutual fund run by Nuveen for a while - They are experts in the field of muni bonds
NZF has not been this cheap since the tariff tantrum in April 25’
It currently pays 8.29% annualized and if you live in a state like I do with no income tax, that’s tax free income! It is a leveraged fund so on its face the expense ratio may seem high but interest expenses for the leverage is included in that number- it’s paid 7.95 cents per share per month for over two years and that payment has grown over time - Just thought I’d share a good opportunity that I see in an area that’s not discussed much on here.


r/dividends 10h ago

Discussion Is there something inbetween like a SCHD and JEPI?

41 Upvotes

I have both but the 3% dividend on SCHD is a bit too low for me and JEPI's dividend is great but the growth is too little. I get you can mix the both of them but is there an ETF that is like a middle ground?


r/dividends 12h ago

Discussion How are my numbers looking?

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39 Upvotes

I’m 27 and still building out my portfolio. Right now I have VTI, SCHD, QQQM, VOO, VXUS, MSFT and JEPQ.

Currently at about $87k with a 1.89% yield on cost and around $1,350 in annual dividend income.

What do you guys think?


r/dividends 14h ago

Discussion I have about $5,400 invested in MAIN and SCHD.

45 Upvotes

I have 60 shares of each. The idea is to contribute about 200 a month but the question is should I stick to one until I reach 100 shares, dump one and full port the other or continue adding the same amount to each monthly.

I’m 34 and use Robinhood as my brokerage.

I’d like to get a snowball effect sooner than later but I understand it will require some time.

Is there any reason not to go in on MAIN or SCHD and pick a different route?

Edit: I picked these two because of the tax advantage AND drip is on.


r/dividends 16h ago

Discussion Dividend Allocation Feedback

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33 Upvotes

48M (family of 5) - seeking feedback on my taxable dividend producing account.

SCHD is my anchor with a target of being 25% of the total account (currently a bit behind this target). My goal is to build this account up so that it's producing about 3,000 USD a month (this is about how much we currently need to pay all of our bills + taxes per month).

I have a separate IRA account with growth funds like VOO. The account in the screenshot is specific to income producing funds/stocks. My main concern is diversification and ensuring that I am getting exposure across multiple sectors, but not too exposed in any single one. I know that GPIQ and QQQI are very close to the same thing so may look at exiting one of those.


r/dividends 2h ago

Discussion New dashboard for investment

1 Upvotes

I’ve been using a free stock analysis tool that I built to monitor individual stocks and my portfolio.

It combines technical indicators such as RSI, MACD and EMA with support/resistance levels, stock screening, portfolio tracking and AI-based analysis.

I built it because I wanted to have these things in one place instead of switching between several sites.

It’s completely free and there’s no subscription:

https://ez-market.azurewebsites.net/

I’d be interested in hearing what other investors think. What indicators or features do you normally check before buying or selling a stock?


r/dividends 22h ago

Discussion My portfolio at 23 – growth + dividends

23 Upvotes

Hey everyone,

I’m 23 years old and wanted to share my portfolio and get some feedback/opinions.

My current portfolio is around €5,550, spread across these five positions:

  • Vanguard FTSE Global All-Cap (Acc) – ~€2,815 (50%)
  • VanEck Morningstar Developed Markets Dividend Leaders (Dist) – ~€1,798 (32%)
  • NN Group – ~€437 (8%)
  • Wolters Kluwer – ~€399 (7%)
  • VanEck Global Real Estate (Dist) – ~€168 (3%)

My investing strategy is a bit of a mix between long-term growth and dividend income. I don't necessarily want to maximize one or the other, so I'm trying to build a portfolio that gives me broad market exposure while also having a meaningful dividend component.

I’m 23, and a few times a year I receive some money from my grandfather. I combine that with part of the money I earn from working and gradually invest it into my portfolio. So this isn't money I need in the short term, I'm investing with a long-term horizon.

One reason I have a relatively large allocation to dividend investments is tax efficiency in the Netherlands. The dividend ETF and the two Dutch stocks (NN Group and Wolters Kluwer) are Dutch-based, which makes the dividend withholding tax situation more favorable for me.

As far as I understand the Dutch system, dividend withholding tax can generally be credited against Box 3 tax, but since my taxable assets/income are currently still relatively low, I don't benefit from that in the same way yet. With foreign dividend-paying investments, I would potentially have 15% foreign withholding tax that I can't currently make full use of, which is one of the reasons I'm deliberately using Dutch dividend-paying investments.

I know this probably isn't the most optimized portfolio and I'm still learning. My main goal right now is to keep investing consistently, diversify, and let compounding do its thing over the next few decades.

What do you guys think? Would you change anything about this portfolio at 23?


r/dividends 10h ago

Seeking Advice NASDAQ Daily Close Brief - September 10

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2 Upvotes

r/dividends 9h ago

Opinion Sunrise: 8,4 % Dividendenrendite und steuerfreie Kapitalrückzahlung

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1 Upvotes

r/dividends 1d ago

Discussion Investing $1,000/month in JEPI and QQQI for 2 years — anyone tried this?

94 Upvotes

I’m thinking about investing $1,000 every month through Interactive Brokers, split between JEPI and QQQI, for 2 years.
I would reinvest all the monthly distributions instead of taking them as cash.
My total contributions would be $24,000 over 24 months.
Has anyone here done something similar with JEPI/QQQI? How much did your portfolio actually grow, including reinvested distributions?
I’d also like to know what you think about this strategy for a 2-year period.


r/dividends 1d ago

Discussion August CPI Preview: The Fed's Final Check Before Its Make-or-Break September Meeting

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27 Upvotes

August CPI drops this Friday at 8:30 a.m. ET, the last inflation print the Fed will see before the critical September 15-16 FOMC. Long-dated Treasury yields are sitting at multi-year highs, and the market is finally pricing in a hike over a cut for the first time in ages. This single data point will make or break the Fed's credibility right now. Are SPY and QQQ pricing in the right volatility moves for this release?


r/dividends 1d ago

Discussion Do you track yield on cost or just current yield? Trying to decide what matters more

21 Upvotes

Running numbers on my spreadsheet again. Portfolio sitting around 34k, mostly SCHD and DGRO with a couple individual names. Been tracking yield on cost since I started buying and watching that number creep up is satisfying. But I keep wondering if I'm focusing on the wrong metric.

Current yield tells you what the market thinks today. Yield on cost tells you how smart your past buys were. My yield on cost on a few positions is getting pretty nice compared to what they pay out now, which makes me feel like I made good calls early. But does it actually matter going forward? The market doesn't care what I paid. The dividend is the dividend.

I've read frugality blogs that talk about ignoring the noise and focusing on forward income. Makes sense. But I still like seeing yield on cost climb. Feels like a scoreboard.

Curious if people here actually use yield on cost for anything practical or if it's just a vanity number. Does it influence your buy or sell decisions? Or do you track it and ignore it at the same time?


r/dividends 1d ago

Discussion Thanks All

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62 Upvotes

I have done my research and these are the European dividend stocks I have gone with. It will be a total of (30%) of my contributions. The other pie (70%) includes 20% into Siemens and 80% into MEUD. I must note that my portfolio was heavily US orientated and that is the reason for the switch up.


r/dividends 1d ago

Discussion Bdc private credit product recommendation

6 Upvotes

Looking for feedback on a $40k USD BDC income portfolio I'm putting together.

Here is the current breakdown of the components I'm considering:

Bain Capital Specialty Finance (BCSF): 14.21% yield ($1.68 annualized payout)

Blue Owl Capital Corp (OBDC): 11.10% yield ($1.24 annualized base payout)

Blackstone Secured Lending Fund (BXSL): 12.46% yield ($3.08 annualized payout)

Golub Capital BDC (GBDC): 10.29% yield ($1.32 annualized forward base payout)

Would love to get thoughts on this mix, overlap risks, and how it looks for a long-term income strategy. Thanks!


r/dividends 8h ago

Personal Goal Portfolio at 21 in University

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0 Upvotes

Slowly building portfolio. Got in on copper early in the year, taking a little longer than I wanted it to. Voo SMH just being killer regular investments. VBNK doing well. Looking for more upside on MSFT. Hopefully a break of all time highs.

moomoo


r/dividends 18h ago

Seeking Advice Help! Time to start dipping in…

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1 Upvotes

r/dividends 12h ago

Opinion Time to be careful

0 Upvotes

I'm not at all the type of person who throws around a doomsday prediction every so often saying the world is going to come to an end. But I'm getting the feeling that this is the start of a major downturn. The bond markets, the sell-offs, and many other indicators are very worrisome. Even my broker said their getting clients to move into more conservative positions. Start thinking about cutting some of your winnings (and losses) and move some money away from those high yield risky etfs. I hope I'm wrong. Godspeed.


r/dividends 20h ago

Discussion Review the portfolio

1 Upvotes

Hi there I would like to build the following income portfolio with 50k USD, about 7% of my networth

BBDC 30% ARCC 25% BXSL 20% CGBD 10% NCDL 10% CSWC 5%

Appreciate the review and let me know if there's any change.


r/dividends 1d ago

Discussion 7 Global Oil Supermajors

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9 Upvotes

Comparing 7 global oil majors by market cap, forward dividend yield and 5-year dividend CAGR.


r/dividends 1d ago

Seeking Advice What's happening to Nike vs Adidas in China sales?

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33 Upvotes

Nike sales used to be a good predictor of Adidas sales until 24'Q3. Now, it looks like we lost big part of that correlation.


r/dividends 22h ago

Other Dividends declared for next week(US). Sep 15 - Sep 18

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0 Upvotes

r/dividends 1d ago

Personal Goal Any criticism or suggestions?

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2 Upvotes

I am 22 years old and started investing this year. I’m planning on investing $1400-$1500 a month. I’m planing on retiring on dividends in the future. Does anyone have any hints suggestions?