In my recent blog post, I’ve discussed that dividend investing is the strategy I currently use in buying stocks. The Stock I bought are stocks that give dividends once or twice a year. If you miss reading it you can check out my investing strategy here.
Before we start, I want to disclose to you that you are on your own, to follow or not follow my investing strategy. I am not liable for what it will cost you.
Again, this is my personal investing strategy. It works for me, but it does not necessarily mean it will work for you too.
Okay, Let’s start with…
Why I’m into dividend
Let me give you the main concept of this idea. I want to have an income replacement program that will replace my income at some point. It works like this, The total Dividend that I would accumulate will equal my total Annual income.
For you to get it better, let’s assume I am earning 20,000 pesos per month in a year that’s amounting to 240,000 pesos.
My dividend income in a year must be the same exact amount and the money will directly go to my savings account. This amount will be my budget for 1 year, 20,000 pesos per month.
I still have a long way to go, currently, I am expecting to receive an estimated amount of 500 pesos dividends this year. This amount will be reinvested and it will make my base much bigger. More investment means more dividends to come.
Top 4 stock pick
In buying stock the more shares you get the better return you have, so as the risk of losing the value of your money. If it ever happens don’t panic. What is the purpose of you buying that stock in the first place? If you’re like me, who’s interested in that company’s dividends. Let them play their own game believe in them.
Here they are my top 4 stock picks for hoarding dividends. (this table data is dated March 6, 2020)
|Company Name||Stock Code||Dividend Rate||Last Price||Schedule||Board Lot||Total Buying Amount||Dividend Received after Tax||ROI %|
|Premium Leisure Corp||PLC||0.0502||0.4550||Annual||1000||477.47||45.18||9.46%|
At first glance, you might not understand what this table is all about. this table shows how much money you can spend and how much you can earn in a year. Please take note, your money buying power will be lessened when the stock price goes up and the company you choose may or may not give dividends on a certain year. A lot of factors may affect your investment.
Let me explain this table for you, We will be using SPC and SHLPH as an example in this case.
You can buy 100 shares of SPC for 907.53 pesos and that 100 shares you bought will give you a 99 pesos dividends in return for a year that 10.9% return on the money you invested.
You can buy 100 shares of SHLPH for 2,682.80 pesos and that 100 shares you bought will give you a 270 pesos dividends in return for a year that 10.06% return on the money you invested.
What if you buy 300 shares of SPC and compare it to 100 shares of SHLPH?
SPC 300 Shares will cost you 2722.59 pesos, on the other hand, SHLPH 100 Shares will cost you 2,682.80 pesos.
Who will give you a better return on your investment? SPC or SHLPH?
of course. SPC Wins. you will receive a 297 pesos dividends from SPC, compare to SHLPH 270 pesos dividends.
I hope it makes sense to you by now.
There you have it, my Top 4 stock pick in dividend investing. Hopefully, you find it helpful and informative. Accumulating stock shares overtime will surely yield amazing results due to its amazing return.
Imagine, per month you can invest 2,000 pesos in dividend-paying stock with a good return like SPC and reinvest the dividend each time until you reach your financial goal. In my case, that’s my income replacement program.
I see my money will continue to work for me even if I stop working myself. My retirement will surely be taken care of.
Can you imagine yourself living your retirement days not worrying about your daily spending because your income is continuously flowing?
Will your investment outlive you or it’s the other way around?
If you are not sure, do what I do at least you can prepare for your future. Comment below if you find this helpful and informative. Heck, you can even share this post with the people you believe should invest too.