🔥 This Will Change How You Think About Investing Forever ⏰
This is What I Want to Buy 💵
IMAGINE THIS:
You just bought a business in your hometown for $1,000,000.
The company generated about $150,000 in profit last year.
You did your homework—plenty of research—and decided the price was fair.
It wasn’t cheap, but it wasn’t expensive either.
To keep things running smoothly, you hire employees and a manager to oversee operations while you sit back and collect a check at the end of the year.
One year later, you review the financial performance of your business.
It was a fantastic year! The business made a net profit of $200,000.
You pocket the $200,000, go about your life, and look forward to next year’s growing profits.
Over the next year, you receive three offers to sell your business.
To your dismay, all offers are below $1,000,000—the price you paid.
“How can this be!?” you think.
“I made $200,000 last year—33% more than the year before!”
Naturally, you decline the offers.
Fast forward another year, and the results are even better. The company made a net profit of $300,000!
You pocket the $300,000—a 30% yield on your initial investment—and carry on.
Again, you receive three more offers to sell, and once again, they’re all below $1,000,000.
Then it hits you.
You’ve made an amazing investment, regardless of what others are willing to pay for it.
This business is healthy, growing, and pays you a large—and growing—amount every year.
So why should you care what others are willing to pay?
This story perfectly reflects my investment philosophy:
I want to buy amazing businesses that:
Grow their free cash flow every year
Pay reliable, predictable, and growing dividends
When you own such businesses, you don’t need to stress about what the market says they’re worth on any given day.
This is a MASSIVE advantage, especially when it comes time to retire.
Let’s look at an example:
In the year 2000, the S&P 500 was trading around $1,500.
Ten years later, it had dropped to $1,100.
Many people nearing retirement in 2010 had to delay their plans because their portfolios hadn’t recovered from the market drop.
But those living off dividend income?
They didn’t have this problem.
That’s because living off dividend income eliminates sequence risk.
What is sequence risk?
It’s the danger that the timing of returns impacts your portfolio’s longevity, particularly during retirement withdrawals.
Negative returns early in retirement, combined with withdrawals, can drain your portfolio faster than expected—even if average returns over time are positive.
This is why I focus on high-quality stocks that:
Grow their dividend payments predictably
Provide a high rate of annual growth
It’s the ultimate "sleep well at night" investing strategy.
This strategy is already paying me over $500 every month, or over $6,000 a year in dividend income.
And because I reinvest every dividend, my goal of living off dividends is on track to happen a lot sooner than most would expect! 🚀
Check out these resources:
Tickerdata 🚀 (My automated spreadsheets and instant stock data for Google Sheets!)
Interactive Brokers 💰 (My favorite place to buy and sell stocks all around the world!)
Seeking Alpha 🔥 (My favorite investment research platform!)
The Dividend Report 📊 (Free Newsletter for Straightforward Dividend Stock News)
At the start of every month, I send out a newsletter to my paid newsletter subscribers with a list/spreadsheet of all the dividend stocks that I believe to be currently undervalued.
If you’d like to receive this sheet, you can sign up here:
That’s all for now!
See you next week!
Dividendology 🚀