Passive income thread

[spiritGate]

Hello all!
I’m 27 years old, earning about 3k a month
Wondering would it be wise to start buying stocks that gives dividends at my age and slowly build up my dividend portfolio until I can retire.
Can anyone here give me some tips?

Why not? But have to read up the company profile and understand their business and their financial before investing. If not can invest in sti etf or SSB. No need to rush in

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[flyingeagles]

I am new to investment.. I read the entire thread from last night (skipping mainly the technical posts - since I don't understand them), I have a question.

How do I determine what is a high dividend stock?

By high dividend, does it mean high % of share price or the absolute value of dividend?
In this case comparing the two below, which is the higher paying dividend? The one with higher percent or both are the same?

Example:

Stock A
Dividend of 10% at market share price of $1 each
So dividend is 10 cents for 1 share.
Shares held: 10
Dividend = $1

Stock B
Dividend of 100% at market share price of $0.01 each
So dividend is 1 cent for 1 share.
Shared held: 100
Dividend = $1

 

[TabascoSauce]

I am new to investment.. I read the entire thread from last night (skipping mainly the technical posts - since I don't understand them), I have a question.

How do I determine what is a high dividend stock?

By high dividend, does it mean high % of share price or the absolute value of dividend?
In this case comparing the two below, which is the higher paying dividend? The one with higher percent or both are the same?

Example:

Stock A
Dividend of 10% at market share price of $1 each
So dividend is 10 cents for 1 share.
Shares held: 10
Dividend = $1

Stock B
Dividend of 100% at market share price of $0.01 each
So dividend is 1 cent for 1 share.
Shared held: 100
Dividend = $1

stock b.

but i will nvr touch anything that gives 100% dividend.

and u sld nvr buy anything based on dividend yield alone.

most of the div stocks i hold have relatively low div yield (range from 3% to 6%).

 

[flyingeagles]

I am 22 yo and currently having a $2k gross pay and have about $4k liquid assets to invest. 11k in FD.. I plan to invest about $400 to $500 of my pay every month to accumulate wealth. I have small capital but I wish to invest early and start accumulating and compound my earnings. How can I do that? Is venturing into stocks a good option for me? Or etf is better? From what I gathered in this thread, more people mentioned about etf than stocks..

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[flyingeagles]

stock b.

but i will nvr touch anything that gives 100% dividend.

and u sld nvr buy anything based on dividend yield alone.

most of the div stocks i hold have relatively low div yield (range from 3% to 6%).

Thanks for your reply. I will keep that in mind. My main goal now is to accumulate wealth and start to have a bit of dividend income as well.

Someone in this thread mentioned that a young person should focus on accumulating wealth and only focus on dividend when we are retired. I am going to follow that advise..

Also some has also mentioned that dividend is just left pocket out right pocket in. So why do people still focus on dividends?

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[existential_reality]

Dividend investing or stock picking as some put it has its own inherent risk, if you are willing to do your own homework to understand the basis of the company, its cashflows, growth potential etc etc to assess its soundness then yea sure its worth considering. Bearing in mind company situations change and it requires fairly consistent monitoring.

But if you are intending to just buy high dividend stocks or based someone else's recommendation then if you lose your capital you only have yourself to reflect on.

Given your question I think you have some way to go, suggest you do online reading/youtube etc to brush up stock fundamental analysis skills.


"Also some has also mentioned that dividend is just left pocket out right pocket in. So why do people still focus on dividends?"

Thanks for your reply. I will keep that in mind. My main goal now is to accumulate wealth and start to have a bit of dividend income as well.

Someone in this thread mentioned that a young person should focus on accumulating wealth and only focus on dividend when we are retired. I am going to follow that advise..

Also some has also mentioned that dividend is just left pocket out right pocket in. So why do people still focus on dividends?

Sent from HUAWEI LYA-L29 using GAGT

 

[Maeda_Toshiie]

Thanks for your reply. I will keep that in mind. My main goal now is to accumulate wealth and start to have a bit of dividend income as well.

Someone in this thread mentioned that a young person should focus on accumulating wealth and only focus on dividend when we are retired. I am going to follow that advise..

Also some has also mentioned that dividend is just left pocket out right pocket in. So why do people still focus on dividends?

Sent from HUAWEI LYA-L29 using GAGT

Incorrect. What matters is the amount of liquid assets on hand and how much it grows, not dividends, regardless of age. You should not seek high dividends if it reduces the overall portfolio gain from capital appreciation (and dividends). Instead, as you age, you seek lesser volatility in your portfolio, hence the typically suggested continued shift from less stocks and more bonds as you age.

 

[Toni90]

I am 22 yo and currently having a $2k gross pay and have about $4k liquid assets to invest. 11k in FD.. I plan to invest about $400 to $500 of my pay every month to accumulate wealth. I have small capital but I wish to invest early and start accumulating and compound my earnings. How can I do that? Is venturing into stocks a good option for me? Or etf is better? From what I gathered in this thread, more people mentioned about etf than stocks..

Sent from HUAWEI LYA-L29 using GAGT

Put your money in cpf lah. When u double salary then start investing other things.

 

[Maeda_Toshiie]

I am new to investment.. I read the entire thread from last night (skipping mainly the technical posts - since I don't understand them), I have a question.

How do I determine what is a high dividend stock?

By high dividend, does it mean high % of share price or the absolute value of dividend?
In this case comparing the two below, which is the higher paying dividend? The one with higher percent or both are the same?

Example:

Stock A
Dividend of 10% at market share price of $1 each
So dividend is 10 cents for 1 share.
Shares held: 10
Dividend = $1

Stock B
Dividend of 100% at market share price of $0.01 each
So dividend is 1 cent for 1 share.
Shared held: 100
Dividend = $1

Valuing a stock is way more complex than looking at dividends. If you can't understand the financials of a company, you shouldn't be buying individual stocks.

 

[mingyang93]

I am 22 yo and currently having a $2k gross pay and have about $4k liquid assets to invest. 11k in FD.. I plan to invest about $400 to $500 of my pay every month to accumulate wealth. I have small capital but I wish to invest early and start accumulating and compound my earnings. How can I do that? Is venturing into stocks a good option for me? Or etf is better? From what I gathered in this thread, more people mentioned about etf than stocks..

Sent from HUAWEI LYA-L29 using GAGT

I think you would want to look into that gains higher yields but you must remember that, it is not guaranteed and there are always risks. You can always start a small amount instead and slowly increase your amount and let it work for you in the future instead.

ETF is cheaper in charges but they are just following the index funds so you might have to prepare your heart if there is a market crash.

 

[limster]

ETF is cheaper in charges but they are just following the index funds so you might have to prepare your heart if there is a market crash.

(1) Why do ETF have lower charges than buying individual stocks?
(2) What index funds do ETFs follow?

A little knowledge is a dangerous thing?

I learn something new everything on MM/SSI!

 

[mingyang93]

Haha yes my knowledge is little so i usually assume ETF would be marked close to the index funds as well. usually i read off investopedia and some online articles to learn abit of ETFs.

 

[Maeda_Toshiie]

I think you would want to look into that gains higher yields but you must remember that, it is not guaranteed and there are always risks. You can always start a small amount instead and slowly increase your amount and let it work for you in the future instead.

ETF is cheaper in charges but they are just following the index funds so you might have to prepare your heart if there is a market crash.

Cheaper? Cheaper than what? Individual stocks? Unit trusts?

Charges? You mean brokerage fee or sales fee? Annual management fee?

Haha yes my knowledge is little so i usually assume ETF would be marked close to the index funds as well. usually i read off investopedia and some online articles to learn abit of ETFs.

???

ETF stands for exchange traded fund. If the ETF tracks a market index, it is an index fund that is traded on a stock exchange.

Please sort out the terminology first.

 

[mingyang93]

ETFs management funds are cheaper to unit trust, ILPs if i am not wrong stocks itself is cheaper?

 

[mingyang93]

for ILPs they also do charge annual account management fee as well at 1.7%?

 

[BBCWatcher]

ETFs management funds are cheaper to unit trust, ILPs if i am not wrong stocks itself is cheaper?

There’s no fund management fee associated with individual stocks — well, not usually anyway — but you have broker trading commissions to pay when buying and selling. Those costs are part of a fund’s “total expense ratio.”

Let’s suppose you are investing in 5 individual stocks, which would be a rather risky thing to do. You would pay 5 sets of commissions when you’re buying those stocks instead of just one commission on the (broader) ETF.

There are some ETFs, such as the popular IWDA and EIMI, that automatically reinvest dividends within the fund, without your having to pay broker commissions.

Anyway, in general a low cost fund is going to be cost attractive compared to trying to assemble a reasonable portfolio of individual stocks.

 

[mingyang93]

Ah okay thanks for clarifying. I will have to do more read up now.

 

[Tiger9119]

Properties also have recurring charges like property tax, maintenance fee and others

 

[cook123]

Maybe 1month rental is for paying taxes maintenance repairs
Sometimes more

 

[Maeda_Toshiie]

Properties also have recurring charges like property tax, maintenance fee and others

SHHHH! DON'T TELL THEM. Rental income is subject to income tax*, but DON'T TELL THEM.