Don’t Buy The Wrong Dividend Stocks…
I see it every day. Investors plop down their hard earned money and buy a Dividend stock without really considering what they’re buying or why. They buy the wrong dividend stock!
Honestly, most people spend more time trying to figure out what toppings they want on their pizza.
10 minutes to decide pepperoni and sausage on a pizza… Yet, 30 seconds to buy $20,000 of a dividend stock they never heard of… based on a 2 minute snipit they hear on the “Financial News Channel.” (Cough CNBC… Cough!)
It makes me sick.
And I’ve seen it happen over and over again…
You buy the wrong dividend stock, take a loss, then do it again and again.
The stock dives, the dividend gets cut, the company collapses…
Any way you slice it, you lose money!
How do you stop the madness and end this crazy cycle of buying the worst dividend stocks?
First you have to get some education.
Now before you go running for cover, I’m not talking about book learning.
I’m not talking about spending years in college.
I’m not even talking about a weekend course.
Picking the very best dividend stocks comes down to a handful of rules… rules of the road if you will.
Rules you can learn in less than 10 minutes.
Once you have a great understanding of these rules… you’ll need to consider a handful of questions… then look at the four key metrics that you should study for EVERY dividend stock you buy.
These rules and questions are very straight forward… but it’s the Key to finding the very best dividends and capturing a fat dividend payout year, after year, after year!
Of course once you’ve figured out the best investments to make, Uncle Sam likes to complicate everything by taxing dividends.
Don’t overlook this part, because if you pick the right dividend stock you’ll grab some fat payouts… and you want to keep those tax payments as lean as possible.
So let’s look at these topics on dividend stocks a bit more closely…
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If you want to stop making huge mistakes with your trades… and stop picking the worst dividend stocks ever… you need to start with the 10 rules of dividend investing.
Here they are:
- Get a dividend investing plan and stick to it.
- Start NOW – Don’t drag your feet.
- Keep your investing plan simple.
- Investing CONSISTENTLY is more important than investing BIG!
- Always invest for the long term.
- Understand what dividend stocks you’re buying.
- Be a business owner, not a stock trader.
- Stock up when your dividend stocks are on sale!
- Don’t avoid “Pass Through Entities” as investments.
- Finally, with dividend investing, boring is good.
Now you’ll notice something about these rules… they’re not hard and fast… they don’t say buy this but not that… they talk more about your mental status.
You want to think of dividend stocks in the right way… you want to invest for the long term… you want to keep the tax man at bay as long as possible… and you want to do research on these investments like you’re buying a company not trading a stock.
Once you understand the these 10 rules of dividend investing, you can start thinking about bigger picture items like…
Get deeper explanations about these 10 dividend investing rules.
It’s in our free report: “Ultimate Guide To Dividend Stocks”
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You’ll want to ask yourself 4 critical questions about every investment.
- How does it fit into your overall portfolio?
- Are the markets right to buy?
- Is the economy right to buy?
- Is the industry having any issues?
Each of these questions is critical to identifying the right investments and the right time to make them.
After you’ve figured out the 10 rules of dividend investing, and explored the 4 critical questions, you’ve got to start looking at the specifics of the stock.
There are 4 critical metrics you need to study.
You can’t look at these in a vacuum. You must review them, see how they fit in with the overall performance of the company, and how it compares to other dividend stocks you’re looking at.
So, here are the four critical metrics you must look at closely:
- EPS “Earnings Per Share”
- Yield … specifically dividend yield
- Payout Ratios
- Growth Rates
Now I don’t have room here to go into each one here. But, If you want to get the details on why each of these Key Business Metrics is so important, Sign up for my free report “The Ultimate Guide to Dividend Investing.”
In it, I share all this analysis, plus commentary on the 13 Dividend Stocks You Must Buy Today!
Get the report free here…