@@nicka2256Many people started with a low amount, including myself. The dividend amounts seem painful at first, but they won’t stay that way. Good luck!
That is awesome Leonard. It will add up so nicely over the years. You'll get a nice broad cost average with your accumulation strategy. You'll be pleasantly surprised when you zoom out in the future (:
I’m 73 and only have 500 shares . As I become less active of a trader, I will begin putting any cash f.rom sales into this ETF. I’ve also spoken to my wife about needing to keep the money working after I’m gone. Limit withdrawal because I don’t want an6 future relative to live off the income or value of my money. It should only supplement their income so make their life a little better. I know this will not be realistic on 500 shares but when my other holdings get sold this will increase SCHD shares to 15,000 or more.
Very nice, Tom! Love it. That snowball will get going and will help create wealth for your family well after you're gone. I have a similar goal with my wife & kids. I want to make sure they are set forever regardless of what happens to me. This is why I love low-cost ETFs like SCHD that have quality methodology. Buy & hold forever is our friends. Taking forever very literally (:
Very nice, Fred! Mixing in some other great holdings is how to do it in reality. This video uses 100% SCHD just to show the great long-term methodology performance, but JEPQ and XLK are amazing holdings to sprinkle in as well.
I DCA about 8 or 9 shares per week. But when I remembered the dividend date was this month, I checked to see where I could possibly get more cash to invest at the last minute. I was able to get 18 more shares at once. What a great feeling. Now I have 189.71 shares. I invest equally in SCHD, VOO, and VGT, but I always put that little bit more if possible into my bond replacement because It helps me sleep at night knowing my future self in 20 years will have that comfy cushion to lay my head on in tough market times. I'll never sell the SCHD. If anything, I'll start relocating the other funds into SCHD later on when they are compounding insanely 😂
I love the mindset and strategy! I love SCHD too. Long-term, it will be fun to dabble in some other income producing assets (in retirement). But like you, I will only put new money or dividends paid into these positions. No intentions of selling SCHD / VOO / VGT personally (unless I NEED cash immediately).
I've held SCHD for about 8 years. Took advantage of the downturn & bought a lot. My other favorite is PEY (Invesco High Yield Equity Dividend ETF, tracks NASDAQ)
Thank you for watching and for the kind words! I will always be dropping SCHD updates as it is a major holding in my portfolio. Love showing the performance over time.
This is a great video. Thanks for showing the dividend growth without DRIP. It’s encouraging to see this, since our goal after all, is to eventually take distributions and not DRIP back into the investment.
Thanks for the positive feedback Chad. I appreciate it! Yeah, I think most people watching this video will want to see it with DRIP off (from a retirement perspective). I want to update the spreadsheet to show both for next year's update.
It is never too late to get started Brianna. It really isn't. You'll be kicking back and happy you went through the first few steps in a few short years. Once you have a base, of course, it's great to keep learning. But it only gets easier (:
Love SCHD.... ThanX for another GREAT video Jeff...... Always educational videos...!!! Hold 1179 shares of SCHD over 5 accounts..... Trying to build up my holdings in each of the accounts this year,... Hold more Dividend Stocks so trying to start working hard to build up my ETF holdings.... Thanks again Jeff.... I will be awaiting your next great video(s) .....
Hi Jeff, first time viewer but I subbed for great content. I have a question tho: with the market at “all time high” … is now a good time to DCA? OR should we wait for a dip? I’m wondering where I should invest a hundred K to get the best returns right off the bat?
Thank you for watching and subscribing. I appreciate it! I'm going to copy in my canned answer to this question. But to add a little extra color here, I think DCA into the market is always good. The time to start is right away. As far as lump sum investing (a big chunk all at once), please see below: The lump sum investing (LSI) vs dollar cost averaging (DCA) is the debate that will never die. It's a tough one that doesn't have a 'right answer'. LSI is better 67-80% of the time (depending on what study you follow). It makes sense, as the market 'generally' goes up over long periods of time. So time in the market beats 'waiting to time' the market over the years. However, you can LSI everything in, and see it drop by 40% the next month if the next recession hits. Nobody knows when that will happen. My suggestion is to LSI a solid amount (half if you're comfortable, or whatever % makes sense to you) into your investments. Then DCA the rest in over the next year or so (take the remaining amount to invest divided by 52 and invest that amount weekly). Again, there is no 'right answer' to this one. I tend to favor LSI, but it comes with its risks for sure. The key is to dividend the DCA amount remaining by the number of weeks you want to spread it over, and stick to the system until it is fully invested.
Im an ETF investor myself. I like VOO or VTI for the cornerstone of a portfolio. I like SCHD for the dividends ETF. And QQQM for a growth ETF. I use VGT for my growth, but I’m a tech bull. QQQM will be more diversified by sector.
Great video! I am incrementally adding a 50/50 mix of VIG and SCHD. They have similar total returns but (from what I understand) less than a 20% overlap. VIG is more of a dividend growth ETF. Relative to SCHD it includes companies like Microsoft, Visa, Mastercard, and others that are likely less inflation and interest rate sensitive. The two ETFs seem very complementary to each other and both have a rating of Gold on Morningstar.
I love that combination. VIG is nice, because it is structured for dividend growth. To the point where it actually removes the top 25% of dividend yielding companies that make the initial screener. Then SCHD gets you some solid yield along with more dividend growth.
Hey Daniel. Thanks for watching and for the comment. The beauty here is that you still have plenty of time to get the dividend snowball rolling with SCHD (: New positions will not feel like anything happens for a long time, but hang in there! When we zoom out it is wild.
Good job Teeps! I was amazed at the dividend return over the past 10 years in your scenario. Pretty impressive. SCHD is just over 20% of my portfolio and I am very excited about the recent reallocation. I'm gonna let it roll!
Nice Robert! Yeah, SCHD never will blow us away, but I love how it produces when we zoom out. Nice one to chip away at buying more shares of and just chillin.
Nice SCHD report. I like the downside protection and still get good growth. It will be my first stop to load up on when t-bills well drop below 5.30%. Looks like a good buy and holder and I love the qualified divs. With no trading of the ETF and the div it will be very tax friendly to keep my total income way down to make me look poor in the eyes of the IRS, and Medicare and the VA that wants to kick me out because my income increased too much.
Awesome feedback, Gary. Thanks for watching. Yeah, the sneaky tax advantage of qualified dividends is often times overlooked in taxable accounts. I have a video that dives deeper into this too. Another sneaky aspect is the step up cost basis when the person with the portfolio passes away. The family gets all gains TAX FREE, and creates a new cost basis as if they bought it on the date of death. With smart moves, retired folks that filing married jointly can pay ZERO dollars in taxes on dividends if they make about 123k per year or less (which is most people in retirement when you add up social security + other sources). The SCHD taxable event is at 0% in that case. It's wild.
I think it's awesome that you quit your job to do UA-cam full-time. And you, my friend, are doing it so professional. What I mean that is that you are going to be right beside us and guiding us for years to come. I thought that was so professional of you. Because when things change, you'll be right there to help us through it. Unlike most UA-camrs, they will recommend let's say a 3-fund portfolio but what happens if things change years from now and they don't have an update on how to change the asset allocations? So I just wanted to say, "Thank You." I hope you have a good day, Jeff.
Thanks Rufina. I appreciate you watching, and I'm glad you are finding it useful! My goal is to reach as many people as possible. It's never too late to start investing.
I'm a fan of that idea. SCHD isn't going to wow us in any market, but it just trucks along. It's a nice stabilizer for a portfolio & it provides deceptively high cash flow over time.
building my roth around schg, schd and fbtc. initially i had my mind made up to do 50% schg, 25% fbtc 25% schd, however, i'm switching and going for 35% schg and fbtc and 30% schd. i'm only 24 years young currently at this moment of time, i wish i started a few years earlier but as the saying goes "good food cooks slow", or in other words, everything takes time nothing is rushed in life.
I love your mindset of taking your time. You have soooooo many years ahead of you. I think all 3 holdings are great, but here is my two cents about your plan (based on your age). Again, I'm not saying to do this, but just providing context. Assuming you will be buying and never selling over the next 30 years with dollar cost averaging in each week or month, I would prioritize a lot more SCHG than SCHD. As long as you don't sell when things crash, it has a very, very high chance of outperforming SCHD in total returns over the next 30 years. Even if SCHG crashes 40% tomorrow (in fact, especially if this happens, buying on sale). With my family members that are teens and 20's, I do 0-10% SCHD. Again, it is one of my favorite holdings (in my 40's), but QQQM or SCHG will likely be better for younger people, long-term. However, you can't go wrong with SCHD, so if you like that dividend snowball and floor protection, by all means, SCHD is fantastic. I'm ramping up my IBIT for Bitcoin exposure a little bit as well. I'm thinking ~4 to 5% cap of my portfolio.
@@JeffTeeples i’ll definitely do that instead, i was recently introduced for schd for the dividends. it seems like i won’t have to fully prioritize it until around 40 ish. i’ll definitely add more exposure into schg and fbtc going forward. i currently have 25 shares of schg, 27 schd, 37 fbtc. i only contributed for 2023, so now my next focus is towards putting in money for 2024 which i’ll go heavy into schg and fbtc
Well done. Reconstitution time! It looks like SCHD top holdings have had some nice dividend growth. Currently holding 1,260 shares across all accounts. Are you adding any other value to your portfolio or sticking with VGT/SCHD/VOO?
Oh yeah, I love this time! I am still rolling with that mix. I have my next portfolio update dropping a week from today (I think, that is what I'm planning on making early this week). The reconstitution is always fun! It's an extra little bonus that I my friend and I update our 'HODL Factory' (my individual stocks) on the 3rd Saturday of March, June, September, and December. So we'll have something extra to talk about (with SCHD being the third Friday of March each year).
You and me both, Jeremy. It's an exciting time of the year. I mentioned in another comment, but it is the day before I do my personal 'reconstitution' on my individual stocks. I run a screener, do some spreadsheet magic, and then pick (what will now be) my top 25 stocks. I even stole a methodology trick from SCHD to reduce my turnover (:
I love this. This gets me more pumped up than holding my TSLA stock as a stupid % amount of my portfolio. I’ve bought SCHD for me as well as all 3 of my kids. My 27 yo has 332 shares, my 21 yo has 11 shares (college funding, hence the lower amount), and my 20 yo has 100 shares. I’ve been garnishing their wages since their first paycheck in high school. Now they are adults and they still let me. 😂. Do you know what their SCHD shares will be paying out and be worth in 35 to 40 years? All Roth IRA’s btw. 😳 And they also have SCHG, SCHB, SCHX, and TSLA included their portfolios. Plus they all let me manage their Roth 401k’s at their work. Someday this will all be on them but I didn’t give them the chance or choice to not execute as most ppl do.
Oh man, I absolutely love this Laser! Laughed at garnished their wages haha. They will be so happy someday! If SCHD returns 9% total return (price + dividends), each share would be worth $1,809 in 35 years, and $2,832 in 40 years! I did it that way so you can do the value for each kid. Those shares are great! It’s also smart to have them in growth ETFs as well, because they have time to ride out the crashes (and get more shares!)
@@JeffTeeples yeah I started priming the kids around age 12 that I would make them save and invest from first paycheck. I always told them they prepare to retire the day they start to work. Kids living at home and working at target making $15 an hour as my 2 youngest did don’t need all that money to blow with no obligations. I found they were happy to give me on average 50% of their paychecks because after years of hearing me saying no to most requests they were now able to blow the rest on whatever they wanted. The more they wanted the more they worked because I didn’t budge on my 50% cut. My son would save his portion for months because he was into computers, TVs, and gaming. Paid cash for everything after emergency fund and investing. They are grown now and have some obligations but concept is still in place, just at lower %, but I think they will all be tax free millionaires at age 60 from a part time job they had in high school and college. 🙏
@@lasercooperI love this! I thought about doing this when my toddler gets of age. I feel like if you stay on them about it and show them your portfolio as well it makes them excited seeing that growth. Kudos to you getting them right!
Same as me. Was 100% tsla and held last 5 years but this year with this run up I wanted to diversify. Sold 60% of my tsla and now 30% in SCHD and 30% into VOO. In 5-10 years as tsla grows I will sell it down to retire with SCHD and VOO.
Thank you for the question, and great move going with SCHD! 3.66% is the yield by %. It's actually closer to 3.4% now. $2.66 is the amount of money it pays per share owned. A share is about $78. For each share you own, it has paid $2.66 over the past year. This is the more reliable metrics because it steadily increases and it reflects what you actually get paid moving forward. The yield % is constantly changing as the stock price changes, but is great for quick math.
I was thinking of going with a simple two fund portfolio consisting of just SCHD and SCHG, since they seem to complement each other well. What are your thoughts? Thanks, love your content!
Thanks for the feedback and question, Kishan. I think that is an awesome one-two punch. Almost literally zero overlap (1%), and a nice coverage of value and growth. Two of my favorite ETFs! And they fit amazingly well together.
Hi sir, based on your analysis between schd vs dgro, which one is the best to take as dividend ets to hold for 15-20 years time? Your advise is much appreciated. Thanks
That is a great, and tough, question. I prefer SCHD within a balanced portfolio. For example, if you had VTI for a cornerstone that holds a little of everything in the US, and then something like SCHG for growth, I would add SCHD as the dividend ETF. If you only held one ETF to cover everything, I would choose DGRO over SCHD for the growth and tech exposure. They are both great, and realistically you could add both of them to do great over 20 years. It is hard to pick between my two favorite dividend ETFs. I do slightly prefer SCHD if I *have* to choose (:
Enjoy! It isn't the most exciting journey, but it gets the job done. When we zoom out it is wild how stable it is. The dividend growth of SCHD is by far its most underrated factor by most investors.
I currently hold 70 VOO, 10 VEA, 10 VWO and 10 SGOV. Whats the difference for adding more SCHD instead of more treasury bonds? talking protection. I also feel like I need some tech like VGT. I’m 28 with stable job and pretend to hold for 10-20 years.
The difference between SCHD and treasuries is the growth rate. If you get a treasury note or bond at 5% right now, you're losing a ton of free money in the future by not getting SCHD. It's a metric known as yield on cost. It is technically pointless 'today', but it is all that matters long-term. For example, today, you could put money into a treasury or SCHD. This is 5.X% or 3.37%, respectively. But SCHD has never paid less dividends than it did the year before. If you bought SCHD 10 years ago, your 'yield on cost' would be about 10%. In other words, those same shares, without any new reinvestments at all, are producing a 10% yield for you compared to the 5% treasuries. In 20 years (10 years later, so 20 total years), it will be roughly 29% yield for SCHD compared to the going rate of treasuries. It seems unrealistic, but that is just how it works. Share price is 'mostly irrelevant' with SCHD (long-term). SCHD is taxed more favorably as well (if in taxable account). Here is a real example of what I'm talking about: I have 4,191 shares of SCHD right now. This data has no assumptions, this is what actually happened. If I bought these shares in 2013, it would have cost and been worth $118,773. At the end of 2023, it was worth 321,408. That is with zero pennies reinvested. Now, the kicker, the 2013 the dividends paid was $3,788. Those exact same shares, nothing else invested or reinvested, paid $11,140 in 2023. The compound impact gets lost on people, and ironically bonds and cash decimate retirees more than anything (with the element of time and compound playing over years). By trying to preserve wealth, they are mathematically throwing it away.
@@JeffTeeples Thats a very detailed and complete answer, thanks a lot. I’ve been told to switch bonds for growth, arguing bonds are irrelevant at my age with a decade or more horizon. I’ve been recommended SCHG a lot, but seems like a lot of overlap with VOO top holdings. On the other hand, I like the companies SCHD holds. What’s your take on growth? Thanks in advance!
I really do think bonds are bad at all ages. People freak out when I say that (especially Bogleheads and professionals), but I argue I DONT care about portfolio value at any one point in time (even in retirement), simply dollar cost averaging into great investments for multiple decades will ALWAYS beat bonds, over the past 100+ years. No exceptions. I think people hating on bonds just because the last couple years don't fully understand the purpose, and why they can make sense in some strategies (I still disagree if we get nerdy, but I've learned to just nod along). If someone was behind, and needed bonds, they are still a bad play (technically even worse). Rant over. For growth, I like VGT, QQQM, or SCHG (many others great too). Low-cost, passively managed funds are great over time. Just never sell when things get ugly. Things will crash, and that's when we need to buy. I wouldn't worry toooooo much about overlap with VOO, as VOO is just 'the market', and when you grab the 500 largest companies, there is bound to be overlap. I do think overlap is good to avoid between growth and dividend ETFs. This is why I love VGT + SCHD, personally. They have only a 3% weighted overlap. But there are many great ways to build a quality portfolio.
Thanks for the comment Will. Two of the very best ETFs there! Can't go wrong. I've been impressed by SCHG the last few years (compared to QQQM, my favorite 'that' type of holding). I definitely have my eyes on it.
I am a Chinese investor, and it is very difficult for us to invest in US stocks due to some policy reasons? But I already have 200 shares（schd）, I hope this is a good start. thanks jeff
I’ve reviewed SCHD before, it’s good but I’m hesitate to invest with the 30% dividend tax I need to bear, this effectively lower the yield to slightly more than 2% only.
It is my favorite site by far for this stuff! I like the organization of the information, the screeners, and it is my favorite portfolio aggregator by far (because the research is always a click away). I used to use Wealthfront for that.
Hey Michael. Very nice! Sit on those bad boys and watch your cash-flow increase for decades to come (regardless of the price fluctuations. And to be clear, the price *will* also go up when you zoom out, but short term can be all over the map).
Thank you for the positive feedback, Craig. Much appreciated. I’m not on Twitter (X) as of now, but I’m sure there will be some expanding in the future. Never been a big social media user.
@@JeffTeeples thank you! I really appreciate all the information you provide! I'm sharing all your content with the 20-30 year old nurses I work with! I hope they can start sooner than I did!
Great video! Instead of doing a scenario that started investing 11 years ago. Can you do one where you start investing into SCHD starting this year with maybe idk 100k?
Hey Tony, thanks for watching & for the feedback. Unfortunately I can't model out SCHD using current data, because these things need history to work (showing trends, growth, etc). I mean, I could do it using the current figures and assumptions, but the point of this particular series is to show how SCHD 'actually' performs. Not forecasts assuming X factors. I mean, technically, this series will show that. It's why I'm including year by year breakdowns (next year I want to update the spreadsheet with price as well). So, the idea is that you'll be able to start anywhere within the window to see how it has actually played out (not what hype videos project for the future). Will be fun to see the trends over the years.
Jeff. What do you think about Artificial Intelligence ETF’s? ARKQ, AIQ, ROBT, BOTZ, IRBO, IGPT? I was thinking about making an M1 pie of these AI ETFs. They have been on fire for a while and I think they are the future. Thoughts???
I'm a big believer in AI being the next big thing. However, I like to get balanced exposure to it. I believe more in tech at a high level, long-term, than AI specific stocks or ETFs. A lot of the hot topic picks end up falling face first. I like things like VGT and VOO to get exposure to any new top tech trend, including AI. Don't get me wrong, they might go to the moon. It happens all the time. But I've seen more things 'like this' go crashing down long-term. It often times makes us have to 'time it' to get a decent exit. I like owning tech, at a high level, forever. Then I know I'll have a slice of the companies that *really* won the race, years from now.
I think there are a lot worse ways to go than SCHD. It isn't a bad ETF to go all in on. It is the only ETF I hold for value / dividends in my core long-term portfolio. However I also hold a third of VOO. It or VTI gives broad market exposure. I also hold a third of VGT + QQQM (they combine for a third). I like a balance between a good cornerstone (VOO), a value/dividend ETF (SCHD), and growth (VGT/QQQM). If I had to pick one holding to go all in on, it would probably be VOO. It is a nice mix of value (SCHD) and growth (VGT/QQQM).
Thank you Seginald. I really appreciate the positive feedback! I will throw JEPI on the official 'to review' list. I'm trying to work through the major ETFs that I follow. JEPI is one of them (:
I think I need to make one like that! 100% portfolio of all of my favorite dividend ETFs. I could share the yield and growth rate. I’ll note that for future videos. DGRO is awesome.
COST paid a special year end dividend of $15 per share. Since SCHD held over ten million shares of COST on the ex date, there will be well over $150 million extra to distribute this quarter
It is going down today. I will be reading about it hopefully tonight. I’m not sure exactly when we will see the info. I’m on the go right now, but can’t wait to check it out later.
Wow so lucky to have found this Channel. Im 34. I Have about 120k in a self-directed IRA. Do you recommend this ETF or is there something better being that I don't need to worry about taxes? Thank you and Godbless.
Thank you for the positive feedback & the question. I'm glad you found the channel too! Not financial advice here, but... In your 30's you will likely want more growth and cornerstone holdings mixed in. I'm 41, and I go with a third each of VOO / VGT / SCHD. VOO is the cornerstone (owning the 500 largest companies in US, known as 'the market', and what everyone tries to beat). VGT is a growth ETF that is 100% technology. If that is too much tech, I highly recommend QQQM for the growth section. SCHD is the cash flow section that pays and grows dividends. You don't need to worry about tax implications in your IRA. They are treated identically (you'll be taxed when you take the money out, at your current tax rate in the future when you retire). Dividends and growth have the exact same tax implications. If you go with a nice mix of VOO / QQQM / SCHD (let's say 40% VOO, 35% QQQM, and 25% SCHD at your age), be absolutely sure to NEVER sell your QQQM or VOO (or anything really, but especially those) when the market is down. If you lose 40% of them in the next crash, be a buyer only. You're picking up more shares of a great asset at lower prices. 'Eventually' they will hit another high. The only way to lose with a modern portfolio like this is to panic sell when things are bad (you're giving away shares for less $).
Hey Jeff, Thank you for your video. Could you make a video related to DIVO and/or other covered call "enhanced" ETF's ? What's your take on those ? Perf. wise as per portfolio visualizer, DIVO = SCHD in Total Returns. Would love your opinion on those. Thank you and keep going !
Hey Filipe. Thank you for watching and for the question. I like those derivative ETFs for producing high yield NOW if cash flow is needed NOW. JEPQ is my personal favorite. I love it for 'greedy cash' in my portfolio. However, I think DGRO, SCHD, and VIG ETFs are better for 'long-term cash flow' because they are always growing the dividends. When you zoom out, they pay a lot more money over 20 years. These are better 'investments' in my opinion. I'll try to drop some more videos on the topic in the future.
Thanks for the SCHD motivation. Doesn't it recalibrate this month? Is it waking up just now? It is my BND replacement, along with 5-5.28% in MMA settlement funds, at least for now. No dips lately, so I've been neglecting it a bit lately.
Thanks for the feedback & question Karl. It sure does, it has the reconstitution on the third Friday in March. I can't wait to see. Potential video! Although I will only be able to make one the next couple weeks, so may be a bit late, or missed this time around (out of town for a little bit).
Hey Scott, great question. I ironically don't have a Vanguard account (I went with E*Trade to never run into this first party only issue), but I think the answer is yes. Can anyone confirm?
I like SCHD better, too. VIG is nice, but quite a bit of tech, and a very low yield. I get my fill of 'that' with VGT. I love the 1-2 punch of SCHD and VGT. Together, the yield is similar to the VIGs of the world with way higher total returns. VIG and VYM are great, to be clear. I don't think we can go wrong either way.
Hi Jeff. I’m thinking about getting out of my real estate and just paying the capital gains on $2M sales instead of 1031 into the next properties. I was thinking about investing the proceeds into. 1. VOO 25% 2. QQQM 25% 3. VGT 25% 4. SCHD 13% / DGRO 12% First, is this a good portfolio to just park a large chunk of money into, over $1.5M and just let it sit for a long time. Second, would you roll the entire amount in one chunk or dollar cost average chunks at a time? Maybe, $50,000 to $100,000 a month until it’s all exhausted out of the M1 high yield savings. Let me know what you would personally do? I value your opinion.
Big moves! I love that portfolio mix, especially if you are going to stay the course with it for at least 10 or more years. The growth ETFs like QQQM and VGT will commonly fall face first in the short term. The rollercoaster goes up over the long haul (not just over the past 10-15 bull years, but zooming out 40+ years it is the same story). The dollar cost averaging vs lump sum investing is always a great debate. There are no right answers. I'm normally a fan of a hybrid system between the two. Lump sum is 'usually' better because the market 'usually' goes up. However, there is a major risk of seeing large drops at any moment, and I feel that risk is 'higher than usual' right now. Of course I don't know what will happen and when. Nobody knows that. For me, with $2M, I would likely put $500,000 in right away, and DCA the rest in at $25,000 per week. This would get it fully invested in 60 weeks. Normally I'm a fan of putting half in and getting the rest in there in a year or less. But 'right now' I would take this slightly more conservative approach.
VGT doesn't track the Nasdaq, however, it has quite a bit of overlap with QQQM. They have a weighted overlap of 48%. So they are about 'half the same'. VGT is 100% tech. QQQM is 50% tech (that is the overlap), and then 50% other sectors. This makes QQQM a bit more diverse. VGT has had better returns by a decent amount over the past 5 and 10 years. I'm a tech bull, so VGT is what I roll with. But I've considered mixing in QQQM for a little more sector balance within my growth. Total Returns: 5Y: 158%, QQQ 144% 10Y: 538%, QQQ 453% They are both great. QQQ is actually better over the past 20 years. They both have SMASHED the market. PS: Using QQQ because it has the history. QQQM is too new. But they are 'the same' outside of the slight expense ratio difference.
I have a video idea for you, mainly because I have been searching for like a month straight and cant find a single one. Scenerio: you have $500,000 to invest, but you lost your job and/or business and not sure if/when you can get back to work. What kind of high yield investments could you put that savings into in order to maintain the 500k while also giving enough dividends to make about 40k? At the moment you could put into a 5% CD and make $25,000 a year APY, drawing out about 15k per year until you get back into business. 1-2 years that wouldn't be a terrible idea, but they may start cutting rates soon. Would it be worth putting together a portfolio of stocks like BTI, MO, high yield etfs, etc?
Love the video idea Jonathon! Will throw this on the ideas list. I know a big portion of my $500,000 would go to JEPQ. I love that one (great index, high yield, and I don't mind the high volatility of the Nasdaq-100, long-term). I would have to throw together some other holdings to get the best combination of dividend growth, stability, and to hit that $40,000 / year mark. Putting this on my video ideas right now.
@@JeffTeeples I def appreciate it. Everytime you make a post of stocks & income everyone flames you for yield chasing. I feel like this is a solid question tho. Might have come into some inheritence, sold your business, been saving for years, etc then you get hurt, covid shutdowns, get fired, lose job whatever it may be... Surely theres a better way than just eating away at your savings until you find something
Thank you for watching & for the question. I do back tests here: www.portfoliovisualizer.com/backtest-portfolio Then all of the information is from Seeking Alpha. It is my favorite site to research stocks and ETFs. I have a link in my video descriptions if you're every interested in trying Seeking Alpha Premium for free and saving money if you like what you see.
Hi Jeff, just wondering if you could do a video sometime in the future on when someone should take social security. My full social security payment is age 67, I am thinking to take it as early as possible, ie at age 62 and then fully invest the money in SCHD. Assume no price appreciation and only considering SCHD dividend payment, with 10% annual increase on dividend, I think I will be better off to start taking at age 62 than wait till age 67, unless I live until like age 95, which is not too likely. Many people say you should take as late as you can, but I am really not sure that is the best option. I will be 60 in a few months. Like to get your insight on this. Thank you!
Hey Cindy! It's like you're reading my mind. I've been working on a video (although I have been out of town a bit lately, not sure exactly when it will release) that covers this topic. It doesn't go into depth, and it is situationally dependent for sure. But, 'in general', for people that invest in assets that pay qualified dividends (great for taxes) like SCHD, it is better to take SS early. I use myself (rough plan) as an example in the video. Again, this isn't one size fits all advice, and I explain the breakeven being a fairly young age (I want to say 77 years old in my case), so 'on paper' it may look like waiting is the best option. However, for 'most' investors, taking it early is the better play, long-term, mathematically.
Greetings. Currently have 50% SCHD, 30% QQQM(and building) and 20% SCHB in a roth ira. With SCHD having such good downside protection, what are your thoughts on perhaps dropping SCHB (which is essentially playing the 'safe' role) and increasing SCHD/QQQM ,or, adding in another high earning ETF like DGRO or JEPQ to replace SCHB ?
Hey Seth. Thanks for watching and for the question. SCHB is solid. I think holding it isn’t a bad move. I do like more QQQM, or some DGRO as a potential replacement, too. Because you have a nice chunk of SCHD already, I would probably add to QQQM, personally. Assuming you don’t need more cash flow now and are building this thing for the future.
I may have missed it, but when you run your analysis of SCHD & VGT illustrating that a beat of VOO each of the last ten years are you rebalancing at the end of each year or no rebalancing?
Hey Mac, thank you for the question! It is using rebalancing at the end of each year (I have done so with new dollars buying the underweight one throughout the year, but the official backtest had a rebalance). However, regardless of timing and weight, 50/50 SCHD/VGT has outperformed VOO each of the last 10 years. So it's more of an 'in a vacuum' study. But to your specific question, the numbers that show the totals ultimately DO have annual rebalancing on. Here is the video: ua-cam.com/video/IQpqYM0NqXk/v-deo.htmlsi=jS3_GyxogIrcQuXr
Hi Mommy-Investor. I would add DGRO if it was for a long-term dividend ETF position. JEPQ if it was for short-term cash flow that is needed right away.
Since SCHD is getting dividends throughout the year, but paying them out to you quarterly, what does it do with the dividends in the time in between (assuming that you don't reinvest)? Does it keep a portion in cash to pay out the non-reinvestors?
Hey Duncan. Great question. The ETF managers will collect money from the individual companies throughout the quarter, and then pay them out at the end (or reinvest them based on preference). I don't know 'exactly' what they do, I'm assuming it is in cash pending for a payout or a reinvestment.
Thankyou Jeff !! Can SCHD be used to hold excess cash which I would like to get better returns than CD and money market, but take minimal risk? What are your thoughts? Also is it better to hold in taxable Ira or roth ira?
Thanks for the feedback & the great questions. As long as you have an emergency fund and no credit card debt, I would say yes. Excess cash could be held in SCHD. This is actually somewhat how I view my SCHD. Don't get me wrong, it is a great long-term investment, but it does its work with MUCH less volatility than VOO and VGT (my other two main ETFs). People will argue that CDs and T-bills are paying 5% compared to SCHD only being around 3.4%. But they forget the part where SCHD doubles every 6 years so or by holding the same exact shares. The dividend growth gets lost in the shuffle. SCHD pays qualified dividends, and is equally effective in any account. With a Roth, you never pay taxes. With a taxable account, you pay taxes, but the best kind possible (long-term capital gains tax table, and it doesn't add to your income). I have more information coming out about this in a video soon. But I prefer my SCHD in a taxable account. The dividend tax can be zero percent, and the price appreciation tax can also be zero percent, in a taxable account. More to come (:
When does SCHD pay dividends? I want to buy some shares, but I don't want to miss the dividends. otherwise I think I should buy shares on VYM since dividends will be paid towards the end of March. Any thoughts ?
Hi Shirley! Thanks for watching and for the question. SCHD pays quarterly dividends in March, June, September and December. I think the ex-dividend date will be in a week and change from now, so there is still time to buy & collect the March dividend.
That is grading the trailing twelve months only (least important for long-term investing as far as growth). It only increased by 3.77% in the past 12 months. If you zoom out more, it has the following: Growth Per Year 3Y - 9.43% 5Y - 13.05% 10Y - 11.39%
That is not a strategy for me. I do understand the logic, but paying 0.99% ER or higher per ETF will take long-term returns no matter how you slice it. In fact, that will take about 28% of your wealth over an investing career. The compound impact is wild. I think it can make sense to have a low-cost, high yielding ETF to push cash-flow. Not for me personally, I'm all about the dividend growth + total return in time.
@JeffTeeples I think you are missing a serious investment growth mechanism here worrying about 1%. With 25,000 dollars investment into AMZY will net 700-1000 a month. That is the same yield of investing over 250,000 dollars into SCHD. Instead of reinvest back into yieldmax just buy SCHD with the premium. Imagine how much faster you can get to your goal buy adding 12k a year into SCHD by using yieldmax premiums. In 2 years the premiums from yieldmax max would have paid off the 25k you put in. It's a new world with new tools. I made $8800 from last months premiums. Over a year period I'd receive 105,000 in premiums. If I were to invest in SCHD I would need 3,000,000 to get that same yield. I'm only using 175k of my money.
I respect your view on this. I am going to make a video soon that breaks down the long-term results of this scenario. There is merit to what you are saying, but I think you will be floored by the scenarios.
@JeffTeeples great video idea, I'll be happy to watch it. Ya I definitely have concerns with yieldmax especially taxes and what you mentioned. Not saying to make it the main holding strategy but I don't see the harm in buying a certain percentage of portfolio to increase available cash to reinvest elsewhere. That's all I'm saying haha
Hi Jeff, I am already retired. I am living off of my savings and SS. Previously you have advised me to divide my savings into VMFXX, SCHD and a little JEPQ. Currently I am looking for around $8K per month in PRE Tax dollars, Do you have a tool that you are sharing to members (thats me!) that would allow me to to visualize the above mix and how I would piece it together to start creating that income immediately?
I do. It should actually do exactly what you need. It’s the dividend projector Google sheet. If you make a copy you can put in your information. The Google Doc will explain how to use it. You will update the blue stuff (your holdings, shares, current yield, assumed growth rate (I use the lower of 3 and 5 year dividend growth rate, from seeking alpha). I just updated the sheet, so you can zero out holdings you don’t have, and change the shares of what you do have (like JEPQ, SCHD, and VMFXX). You can also change the assumed dividend CAGR (dividend growth rate) to be more conservative if you would like. Anything blue text can be changed without breaking it.
Is it a smart idea to only invest in SCHD until retirement? Currently have 3800 shares of it. I max out my roth ira every year towards it. Any thoughts?
I'm not a financial advisor but I was told to never keep all your eggs in one basket. IMHO, if that's the only thing in your IRA but you also have a brokerage account with other holdings, then I wouldn't lose sleep over it.
Last year was a perfect example why that's a bad idea when tech growth dominated the market. That's y I believe everyone should have at least some exposure to growth no matter ur age. I hold growth funds like schg and xlk in my brokerage.
Very nice G Money! 3,800 shares is impressive. In reality, you'll likely want to have a variety of assets when you retire. You can sprinkle in other dividend ETFs, money markets, T-bills, high yield dividend ETFs like JEPQ, etc. However, SCHD, in my opinion, can safely be the lion's share of your portfolio. The screener has a bit more depth than that of DGRO and VIG (they focus exclusively on dividend growth), and it is 100 quality companies. You'll never be out of balance by sector, and heavy in any one company. It's funny because I often see people say 'eggs in one basket is dangerous', so they pick 10 to 20 dividend stocks instead to diversify. In reality, they have WAY more eggs in one basket, AND, they have to keep up with the news and potentially time the market. ETFs are not 'eggs in one basket'. I do always like to make sure the ETF has a hefty AUM though. The popular, low-cost ETFs like SCHD are 'usually' good to go on that.
VOO and QQQ are great holdings to pair with SCHD. QQQ is one you'll want to never sell during a crash (if anything buy more), because it will have volatile swings.
keep pumping out those financial informational videos Jeff!!!! i buy SCHD and SPYI weekly ($150) into each.... what is your take on SPYI???? is it too early of an ETF for you to start investing into????
Thanks for the kind words & the question, Kevin. Funny timing, I have been casually watching SPYI for a while, and I just took a deeper look yesterday when I was sitting on the couch with my kids watching their tablets. It's hard for me to get over the expense ratio being 0.68%. I understand it's actively managed, and I totally get it. But that will cut into the long-term returns. The yield is juicy! I'm in wait and see mode with that one.
Hey Nelson, will do. I'm planning on making a video for JEPI and JEPQ soon. And many more on SCHD (since it's a big portion of my portfolio). I will try to mix in some comparisons, even though they are night and day different as far as portfolio purpose and fit. Still fun to compare though!
Thank you, Jeff. I appreciate it. I would love to understand why they are day-to-night different. I can't wait to look forward to those new videos. Great Job, thank you
@@njmeneses I own both and I’ll give a quick summary. JEPQ is superior when it comes to yield now. It makes SCHD look silly in that regard (nearly 3 times more cash flow). But, SCHD grows its dividend to where years later it will make JEPQ look bad per dollar that was invested. It also is better from a tax perspective. Shorty version is buy more JEPQ if you need cash NOW, and buy more SCHD if you want more cash in the future. If SCHD keeps up its dividend growth, it has a yield on cost of about 29% for dollars invested 20 years ago (it seems unrealistic but the growth snowball is awkwardly good). Even if it slows down (I’m using its 10 year average of 11.39% per year for that figure) it will run laps around the JEPI and JEPQ of the world.
Hey Tim. Thanks for the question! The answer is that it depends. I would say you're safe to dump at least a portion of your 401k into SCHD. How much will depend on how much you have. If you have something like $100,000, you may want to explore other higher yielding ETFs such as JEPQ. However, if you have a pension and/or social security covering your bills, you could probably go all in with SCHD. SCHD is awesome in taxable accounts in retirement because you will (usually) pay 0% taxes on the dividends received (special tax table for qualified dividends, they are taxed like long-term capital gains). If you have $10,000,000, then growth ETFs and cornerstones like VOO and VTI may be the best path, with a touch of SCHD. It depends on how much cash flow you need, but I would say you can't go wrong with SCHD. It will not be a complete mistakes (like going 100% into a growth stock or ETF can be at times).
Thanks for watching and for the question. That’s a bummer. For dividend ETFs, I think DGRO is a solid replacement. Lower yield, but nice dividend growth. Neither will match the total returns of the top growth ETFs over long stretches of time, generally speaking. But I love the consistency and stability.
Hi Jeff - I own SCHD and this video really helped me understand the value of this outstanding dividend growth ETF. If you had to sell your shares in SCHD, VOO, or VGT to obtain some cash in the short term, what would you sell first?
Hey Bruce, thanks for watching & for the question. If I HAD to sell (I hope to not have that happen pre-retirement), I would sell the one that is the most above its allocation. For example, my goal is 50/50 VGT/SCHD (with VOO also being a third, but it is in a 401k as I can't sell it yet). So I like a third of each, but I can only 'control' VGT and SCHD at the moment. If VGT was 52%, I would sell it back to 50%. Same story with SCHD. Instead of selling when I quit my job to start this channel (6 figure salary was nice, but this is worth it), I picked up some JEPQ for the temporary dividend boost (so I wouldn't have to sell). Oh, and anything I sold would be either a loss, or a long-term capital gain (held for at least a year) for tax purposes.
There are quite a few dividend stocks and ETFs that pay monthly dividends in general. I do not know of one that replaces SCHD. The only monthly payers that I have invested in are JEPQ and JEPI. But these are for a completely different dividend need (higher yield, lower dividend growth rate) than SCHD. The quarterly vs monthly difference is negligible. I know monthly is nice for that flow, but if the two ETFs have the same yield. You'll get something like $3k every third month instead of $1k per month. This is why I personally just look for the best stocks or ETFs. From my experience, most of the best investments happen to pay quarterly (again, this isn't a hard rule or anything).
It is. I would actually go as far as to say it's great to have it in a taxable account. Dropping a nerdy video explaining that in the near future. It can be taxed at 0% forever, including capital gains, for many people. It weirdly can turn a taxable account into (basically) Roth treatment.
Thanks for the comment and the question. This will depend on your goals and time horizon. If you are getting close to retirement or in retirement, these are both incredible. SCHD I think is great at all stages. JEPQ is probably best if you need cash flow now. If you're investing for the future and plenty of income to pay the bills in the short term, I would suggest a mix of VOO, VGT, and QQQM. The selections will again depend on your goals. Bottom line, you could be doing a lot worse than those two ETFs.
@@JeffTeeples I am in my 30s just got married and I had to put down a big chunk of my VTI in a house down payment. Like 75k. My wife is not 100% sure about stocks so I have been showing her how we can “make 1.70 dollars in dividends a day with this portfolio” we are 0 credit card debt and putting 1.2k a month in stocks now. The problem with Jepq is how much it hurts my appreciation and taxes over time correct? Is easier to explain/show to the wife the dividends coming in than the “selling a chunk of the VOO portfolio in old age.” Strategy which she doesn’t like. What would you do in my shoes? VGT, SCHD
I think your mix is solid. I would likely add in some QQQM, SCHG, or VGT (or a mix of them) to add some growth to the mix. You have value covered with SCHD. But long-term, what you have will work too. It's all about staying the course and continuing to be a buyer only. Never panic sell and you'll do well with any mix (I mean, any mix with quality ETFs of course, which you have 100%). Different people take a different approach. So many right ways to go about it.
SCHD's methodology to pick stocks is good but not great. Its decision to eliminate stocks that haven't paid dividends for 10 years eliminate new dividend paying companies like META and CRM, which have great stock appreciation potential.
Thank you for watching and for the comment. You are talking more about growth ETFs (as far as picking up META, for example). This is why they generally outperform the best dividend ETFs in ‘most markets’ on total return. VIG and DGRO will not pick up companies until they have many years of dividend growth by design. They sacrifice total returns for an emphasis on dividend growth. This is why they are a nice addition to growth ETFs. SCHD is similar, only it also confirms dividend sustainability and yield compared to VIG and DGRO with a couple additional screeners. It is a step more towards a true dividend ETF like VYM for this reason. It’s why SCHD is my favorite to combine with the crazy VGT, very little overlap and amazing counterbalance. You’re right in that SCHD won’t pick up new dividend payers. But that is by design and honestly kinda the point for a floor stabilizer.
Thanks for the question Brooks. So I’m a tech bull, but I’ll just go with one of those because I want some diversity in the list. VGT (could also say XLK) QQQM SCHG Maybe that group. So many great ones though, could have multiple honorable mentions. Something like SMH has been better, and it’s great, but way too niched down for me. Not saying it’s bad at all, but just explaining those are the 3 ETFs I would actually invest in.
Hey George. Thanks for the question. Not that I know of on SCHD. VGT has one, called VITAX, but it has a (quite ridiculous) $100,000 minimum investment required.
Bought my first shares of schd this week. Only 3 shares, but it’s a start.
Bought a few SCHD and DGRO the first payday of January myself. We will get there.
Very nice! Let the addiction begin! (This is a good addiction at least).
Another very solid dividend ETF. Very nice.
Iam at 110 shooting for 1000
@@nicka2256Many people started with a low amount, including myself. The dividend amounts seem painful at first, but they won’t stay that way. Good luck!
I have 20 shares of SCHD and plan to buy one share a month moving forward.
That is awesome Leonard. It will add up so nicely over the years. You'll get a nice broad cost average with your accumulation strategy. You'll be pleasantly surprised when you zoom out in the future (:
That's a great idea! I'm up to 9 myself!
Yup 1 a month is my goal too. I have 3 shares right now 😂
Remember to reinvest your dividends
Yeah absolutely. Every stock I have in my portfolio has the dividends reinvested. @@TomBTerrific
SCHD is the bed rock of my retirement investments, also for growth FXAIX, FTEC,QQQM
Love it Jim. That is an awesome mix! Enjoy the growth and dividends forever (:
Solid choices. But I’d pick either QQQM or FTEC. To avoid the overlap
Thanks again Jeff! Looking forward to seeing SCHD’s reconstitution next week. Your videos paying reassurance 😊
Thank you for the kind words! I can't wait for the reconstitution on Friday!
I’m 73 and only have 500 shares . As I become less active of a trader, I will begin putting any cash f.rom sales into this ETF. I’ve also spoken to my wife about needing to keep the money working after I’m gone. Limit withdrawal because I don’t want an6 future relative to live off the income or value of my money. It should only supplement their income so make their life a little better. I know this will not be realistic on 500 shares but when my other holdings get sold this will increase SCHD shares to 15,000 or more.
Very nice, Tom! Love it. That snowball will get going and will help create wealth for your family well after you're gone. I have a similar goal with my wife & kids. I want to make sure they are set forever regardless of what happens to me. This is why I love low-cost ETFs like SCHD that have quality methodology. Buy & hold forever is our friends. Taking forever very literally (:
I plan to retire in about 12 yrs. I have a good amount of SCHD (of course will increase over time), JEPQ, XLK and some individual stocks.
Very nice, Fred! Mixing in some other great holdings is how to do it in reality. This video uses 100% SCHD just to show the great long-term methodology performance, but JEPQ and XLK are amazing holdings to sprinkle in as well.
I DCA about 8 or 9 shares per week. But when I remembered the dividend date was this month, I checked to see where I could possibly get more cash to invest at the last minute. I was able to get 18 more shares at once. What a great feeling. Now I have 189.71 shares.
I invest equally in SCHD, VOO, and VGT, but I always put that little bit more if possible into my bond replacement because It helps me sleep at night knowing my future self in 20 years will have that comfy cushion to lay my head on in tough market times.
I'll never sell the SCHD. If anything, I'll start relocating the other funds into SCHD later on when they are compounding insanely 😂
I love the mindset and strategy! I love SCHD too.
Long-term, it will be fun to dabble in some other income producing assets (in retirement). But like you, I will only put new money or dividends paid into these positions. No intentions of selling SCHD / VOO / VGT personally (unless I NEED cash immediately).
Doing the same three myself. The divis from schd seems like a no brainer in retirement who needs bond funds when you have schd.
A great video, there is nothing like the POWER of SCHD!
Thanks Ari, you know it! SCHD is a powerhouse because it steadily grows that dividend that is already a solid yield.
Schd,voo,qqq. All the one needs.
Amen! That is one heck of a combo for sure.
I've held SCHD for about 8 years. Took advantage of the downturn & bought a lot. My other favorite is PEY (Invesco High Yield Equity Dividend ETF, tracks NASDAQ)
Very nice! Love the combo for dividend yield and dividend growth rate.
Thanks for the recap on SCHD. Appreciate the time you put into the content.
Thank you for watching and for the kind words! I will always be dropping SCHD updates as it is a major holding in my portfolio. Love showing the performance over time.
This is a great video. Thanks for showing the dividend growth without DRIP. It’s encouraging to see this, since our goal after all, is to eventually take distributions and not DRIP back into the investment.
Thanks for the positive feedback Chad. I appreciate it! Yeah, I think most people watching this video will want to see it with DRIP off (from a retirement perspective). I want to update the spreadsheet to show both for next year's update.
I am a beginner, taking baby steps gingerly, I am glad I have come across your channel!
It is never too late to get started Brianna. It really isn't. You'll be kicking back and happy you went through the first few steps in a few short years. Once you have a base, of course, it's great to keep learning. But it only gets easier (:
Love SCHD.... ThanX for another GREAT video Jeff...... Always educational videos...!!! Hold 1179 shares of SCHD over 5 accounts..... Trying to build up my holdings in each of the accounts this year,... Hold more Dividend Stocks so trying to start working hard to build up my ETF holdings.... Thanks again Jeff.... I will be awaiting your next great video(s) .....
Love it Lance, great work. 1,179 shares and climbing. It's getting up there!
Hi Jeff, first time viewer but I subbed for great content. I have a question tho: with the market at “all time high” … is now a good time to DCA? OR should we wait for a dip? I’m wondering where I should invest a hundred K to get the best returns right off the bat?
Thank you for watching and subscribing. I appreciate it! I'm going to copy in my canned answer to this question. But to add a little extra color here, I think DCA into the market is always good. The time to start is right away. As far as lump sum investing (a big chunk all at once), please see below:
The lump sum investing (LSI) vs dollar cost averaging (DCA) is the debate that will never die. It's a tough one that doesn't have a 'right answer'.
LSI is better 67-80% of the time (depending on what study you follow). It makes sense, as the market 'generally' goes up over long periods of time. So time in the market beats 'waiting to time' the market over the years. However, you can LSI everything in, and see it drop by 40% the next month if the next recession hits. Nobody knows when that will happen.
My suggestion is to LSI a solid amount (half if you're comfortable, or whatever % makes sense to you) into your investments. Then DCA the rest in over the next year or so (take the remaining amount to invest divided by 52 and invest that amount weekly). Again, there is no 'right answer' to this one. I tend to favor LSI, but it comes with its risks for sure. The key is to dividend the DCA amount remaining by the number of weeks you want to spread it over, and stick to the system until it is fully invested.
@@JeffTeeples Awesome! Thanks for the note. Makes total sense. But, which companies would you recommend I LSI into
@@JeffTeeples What do you think about fiduciary advisors?
Im an ETF investor myself. I like VOO or VTI for the cornerstone of a portfolio. I like SCHD for the dividends ETF. And QQQM for a growth ETF. I use VGT for my growth, but I’m a tech bull. QQQM will be more diversified by sector.
I’m going to plead the fifth on this one.
Great video! I am incrementally adding a 50/50 mix of VIG and SCHD. They have similar total returns but (from what I understand) less than a 20% overlap. VIG is more of a dividend growth ETF. Relative to SCHD it includes companies like Microsoft, Visa, Mastercard, and others that are likely less inflation and interest rate sensitive. The two ETFs seem very complementary to each other and both have a rating of Gold on Morningstar.
I love that combination. VIG is nice, because it is structured for dividend growth. To the point where it actually removes the top 25% of dividend yielding companies that make the initial screener.
Then SCHD gets you some solid yield along with more dividend growth.
After failed stock investments in flash memory, solar, lithium, and China…. I wish I had known about SCHD and the power of DRIP/CI years ago.
Hey Daniel. Thanks for watching and for the comment. The beauty here is that you still have plenty of time to get the dividend snowball rolling with SCHD (:
New positions will not feel like anything happens for a long time, but hang in there! When we zoom out it is wild.
Good job Teeps! I was amazed at the dividend return over the past 10 years in your scenario. Pretty impressive. SCHD is just over 20% of my portfolio and I am very excited about the recent reallocation. I'm gonna let it roll!
Nice Robert! Yeah, SCHD never will blow us away, but I love how it produces when we zoom out. Nice one to chip away at buying more shares of and just chillin.
Nice SCHD report. I like the downside protection and still get good growth. It will be my first stop to load up on when t-bills well drop below 5.30%. Looks like a good buy and holder and I love the qualified divs. With no trading of the ETF and the div it will be very tax friendly to keep my total income way down to make me look poor in the eyes of the IRS, and Medicare and the VA that wants to kick me out because my income increased too much.
Awesome feedback, Gary. Thanks for watching. Yeah, the sneaky tax advantage of qualified dividends is often times overlooked in taxable accounts. I have a video that dives deeper into this too. Another sneaky aspect is the step up cost basis when the person with the portfolio passes away. The family gets all gains TAX FREE, and creates a new cost basis as if they bought it on the date of death.
With smart moves, retired folks that filing married jointly can pay ZERO dollars in taxes on dividends if they make about 123k per year or less (which is most people in retirement when you add up social security + other sources). The SCHD taxable event is at 0% in that case. It's wild.
I think it's awesome that you quit your job to do UA-cam full-time. And you, my friend, are doing it so professional. What I mean that is that you are going to be right beside us and guiding us for years to come. I thought that was so professional of you. Because when things change, you'll be right there to help us through it. Unlike most UA-camrs, they will recommend let's say a 3-fund portfolio but what happens if things change years from now and they don't have an update on how to change the asset allocations? So I just wanted to say, "Thank You." I hope you have a good day, Jeff.
Thank you for the kind words! They mean a lot to me. I will do my best to provide quality information for years to come.
Thank you so much Jeff, we had been listening to you for 3 months now , forever grateful 🙏🙏🙏
Same here... He is a great teacher and able to connect with his viewers... I see great potential for this channel... Keep it going, Jeff....
Thanks Rufina. I appreciate you watching, and I'm glad you are finding it useful! My goal is to reach as many people as possible. It's never too late to start investing.
@@GabbarSingh-TX I appreciate your kind feedback! I will try to do my best moving forward. I’m really liking this. Zero regrets on my life change.
Well explained. SCHD 60% VYM 20 % AND VGT 20% IN RETIREMENT. INTIAL INVESTMENT BETWEEN 4.5 TO 5 HND.THOU. 25-year retirement life span.
Nice Noorali! That is a wonder mix for retirement! The purchasing power will only get better and better over time.
@JeffTeeples Hopefully, It
will work if you are kind enough , like to see the outcome end of the retirement journey. Rest leftover for
my legacy.
Been nervous about how much I have in ESPP, might rebalance and allocate those funds to SCHD!
I'm a fan of that idea. SCHD isn't going to wow us in any market, but it just trucks along. It's a nice stabilizer for a portfolio & it provides deceptively high cash flow over time.
Nicely done video. I subscribed with notifications. I have been buying SCHD heavily over the past 14 months at an average yield on cost of 3.57%.
Thanks for subscribing Jim. I appreciate it. I think buying SCHD will pay off when we zoom out as time goes on. Keep it going!
building my roth around schg, schd and fbtc. initially i had my mind made up to do 50% schg, 25% fbtc 25% schd, however, i'm switching and going for 35% schg and fbtc and 30% schd. i'm only 24 years young currently at this moment of time, i wish i started a few years earlier but as the saying goes "good food cooks slow", or in other words, everything takes time nothing is rushed in life.
I love your mindset of taking your time. You have soooooo many years ahead of you. I think all 3 holdings are great, but here is my two cents about your plan (based on your age). Again, I'm not saying to do this, but just providing context.
Assuming you will be buying and never selling over the next 30 years with dollar cost averaging in each week or month, I would prioritize a lot more SCHG than SCHD. As long as you don't sell when things crash, it has a very, very high chance of outperforming SCHD in total returns over the next 30 years. Even if SCHG crashes 40% tomorrow (in fact, especially if this happens, buying on sale).
With my family members that are teens and 20's, I do 0-10% SCHD. Again, it is one of my favorite holdings (in my 40's), but QQQM or SCHG will likely be better for younger people, long-term.
However, you can't go wrong with SCHD, so if you like that dividend snowball and floor protection, by all means, SCHD is fantastic.
I'm ramping up my IBIT for Bitcoin exposure a little bit as well. I'm thinking ~4 to 5% cap of my portfolio.
@@JeffTeeples i’ll definitely do that instead, i was recently introduced for schd for the dividends. it seems like i won’t have to fully prioritize it until around 40 ish. i’ll definitely add more exposure into schg and fbtc going forward. i currently have 25 shares of schg, 27 schd, 37 fbtc. i only contributed for 2023, so now my next focus is towards putting in money for 2024 which i’ll go heavy into schg and fbtc
Happy Sunday Jeff - thanks again for the content this week.
Happy Sunday Todd! Thank you for watching the video & for the feedback.
Well done. Reconstitution time! It looks like SCHD top holdings have had some nice dividend growth. Currently holding 1,260 shares across all accounts. Are you adding any other value to your portfolio or sticking with VGT/SCHD/VOO?
Oh yeah, I love this time! I am still rolling with that mix. I have my next portfolio update dropping a week from today (I think, that is what I'm planning on making early this week).
The reconstitution is always fun! It's an extra little bonus that I my friend and I update our 'HODL Factory' (my individual stocks) on the 3rd Saturday of March, June, September, and December. So we'll have something extra to talk about (with SCHD being the third Friday of March each year).
You are among the best. Your videos are excellent and I appreciate it very much.
That is so great to hear. Thanks a lot for the positive feedback! The world needs more positive vibes.
My Favorite ETF!!! I also hold in my ROTH😎
Great video!!
Thank you Jay! I appreciate the positive feedback. I think you're holding a winner!
I can't wait to see the reconstitution this month.
You and me both, Jeremy. It's an exciting time of the year. I mentioned in another comment, but it is the day before I do my personal 'reconstitution' on my individual stocks. I run a screener, do some spreadsheet magic, and then pick (what will now be) my top 25 stocks. I even stole a methodology trick from SCHD to reduce my turnover (:
SCHD 4 life ✊🏼.
Up to 43.738 shares between my wife and i’s accounts.
Nice! Keep on building up those shares. It will compound over time!
I love this. This gets me more pumped up than holding my TSLA stock as a stupid % amount of my portfolio. I’ve bought SCHD for me as well as all 3 of my kids. My 27 yo has 332 shares, my 21 yo has 11 shares (college funding, hence the lower amount), and my 20 yo has 100 shares. I’ve been garnishing their wages since their first paycheck in high school. Now they are adults and they still let me. 😂. Do you know what their SCHD shares will be paying out and be worth in 35 to 40 years? All Roth IRA’s btw. 😳 And they also have SCHG, SCHB, SCHX, and TSLA included their portfolios. Plus they all let me manage their Roth 401k’s at their work. Someday this will all be on them but I didn’t give them the chance or choice to not execute as most ppl do.
Oh man, I absolutely love this Laser! Laughed at garnished their wages haha. They will be so happy someday!
If SCHD returns 9% total return (price + dividends), each share would be worth $1,809 in 35 years, and $2,832 in 40 years!
I did it that way so you can do the value for each kid. Those shares are great! It’s also smart to have them in growth ETFs as well, because they have time to ride out the crashes (and get more shares!)
@@JeffTeeples yeah I started priming the kids around age 12 that I would make them save and invest from first paycheck. I always told them they prepare to retire the day they start to work. Kids living at home and working at target making $15 an hour as my 2 youngest did don’t need all that money to blow with no obligations. I found they were happy to give me on average 50% of their paychecks because after years of hearing me saying no to most requests they were now able to blow the rest on whatever they wanted. The more they wanted the more they worked because I didn’t budge on my 50% cut. My son would save his portion for months because he was into computers, TVs, and gaming. Paid cash for everything after emergency fund and investing. They are grown now and have some obligations but concept is still in place, just at lower %, but I think they will all be tax free millionaires at age 60 from a part time job they had in high school and college. 🙏
@@lasercooper That is incredible, and I think you’re right! (About the millionaire thing).
@@lasercooperI love this! I thought about doing this when my toddler gets of age. I feel like if you stay on them about it and show them your portfolio as well it makes them excited seeing that growth. Kudos to you getting them right!
Same as me. Was 100% tsla and held last 5 years but this year with this run up I wanted to diversify. Sold 60% of my tsla and now 30% in SCHD and 30% into VOO. In 5-10 years as tsla grows I will sell it down to retire with SCHD and VOO.
Excellent video. I just retired. SCHD is a great idea. Why is yield 3.66 and pay of dividend $2.66? Thank you
Thank you for the question, and great move going with SCHD! 3.66% is the yield by %. It's actually closer to 3.4% now.
$2.66 is the amount of money it pays per share owned. A share is about $78. For each share you own, it has paid $2.66 over the past year. This is the more reliable metrics because it steadily increases and it reflects what you actually get paid moving forward.
The yield % is constantly changing as the stock price changes, but is great for quick math.
Thank you very much for explaining. I get so much out of each video. Thank you for your efforts
4850 shares here. Just retired at 55.
NICE. I think you’re sitting in a great asset! Enjoy the increased cash flow in retirement (:
I was thinking of going with a simple two fund portfolio consisting of just SCHD and SCHG, since they seem to complement each other well. What are your thoughts? Thanks, love your content!
Thanks for the feedback and question, Kishan. I think that is an awesome one-two punch. Almost literally zero overlap (1%), and a nice coverage of value and growth. Two of my favorite ETFs! And they fit amazingly well together.
Hi sir, based on your analysis between schd vs dgro, which one is the best to take as dividend ets to hold for 15-20 years time? Your advise is much appreciated. Thanks
That is a great, and tough, question. I prefer SCHD within a balanced portfolio. For example, if you had VTI for a cornerstone that holds a little of everything in the US, and then something like SCHG for growth, I would add SCHD as the dividend ETF.
If you only held one ETF to cover everything, I would choose DGRO over SCHD for the growth and tech exposure.
They are both great, and realistically you could add both of them to do great over 20 years. It is hard to pick between my two favorite dividend ETFs. I do slightly prefer SCHD if I *have* to choose (:
Think I’ll buy some scud on Friday and start my journey with it
Enjoy! It isn't the most exciting journey, but it gets the job done. When we zoom out it is wild how stable it is. The dividend growth of SCHD is by far its most underrated factor by most investors.
I currently hold 70 VOO, 10 VEA, 10 VWO and 10 SGOV. Whats the difference for adding more SCHD instead of more treasury bonds? talking protection. I also feel like I need some tech like VGT. I’m 28 with stable job and pretend to hold for 10-20 years.
The difference between SCHD and treasuries is the growth rate. If you get a treasury note or bond at 5% right now, you're losing a ton of free money in the future by not getting SCHD.
It's a metric known as yield on cost. It is technically pointless 'today', but it is all that matters long-term.
For example, today, you could put money into a treasury or SCHD. This is 5.X% or 3.37%, respectively. But SCHD has never paid less dividends than it did the year before.
If you bought SCHD 10 years ago, your 'yield on cost' would be about 10%. In other words, those same shares, without any new reinvestments at all, are producing a 10% yield for you compared to the 5% treasuries. In 20 years (10 years later, so 20 total years), it will be roughly 29% yield for SCHD compared to the going rate of treasuries.
It seems unrealistic, but that is just how it works. Share price is 'mostly irrelevant' with SCHD (long-term).
SCHD is taxed more favorably as well (if in taxable account).
Here is a real example of what I'm talking about: I have 4,191 shares of SCHD right now. This data has no assumptions, this is what actually happened. If I bought these shares in 2013, it would have cost and been worth $118,773. At the end of 2023, it was worth 321,408. That is with zero pennies reinvested.
Now, the kicker, the 2013 the dividends paid was $3,788. Those exact same shares, nothing else invested or reinvested, paid $11,140 in 2023.
The compound impact gets lost on people, and ironically bonds and cash decimate retirees more than anything (with the element of time and compound playing over years). By trying to preserve wealth, they are mathematically throwing it away.
@@JeffTeeples Thats a very detailed and complete answer, thanks a lot. I’ve been told to switch bonds for growth, arguing bonds are irrelevant at my age with a decade or more horizon.
I’ve been recommended SCHG a lot, but seems like a lot of overlap with VOO top holdings. On the other hand, I like the companies SCHD holds.
What’s your take on growth? Thanks in advance!
I really do think bonds are bad at all ages. People freak out when I say that (especially Bogleheads and professionals), but I argue I DONT care about portfolio value at any one point in time (even in retirement), simply dollar cost averaging into great investments for multiple decades will ALWAYS beat bonds, over the past 100+ years. No exceptions. I think people hating on bonds just because the last couple years don't fully understand the purpose, and why they can make sense in some strategies (I still disagree if we get nerdy, but I've learned to just nod along). If someone was behind, and needed bonds, they are still a bad play (technically even worse).
Rant over.
For growth, I like VGT, QQQM, or SCHG (many others great too). Low-cost, passively managed funds are great over time. Just never sell when things get ugly. Things will crash, and that's when we need to buy. I wouldn't worry toooooo much about overlap with VOO, as VOO is just 'the market', and when you grab the 500 largest companies, there is bound to be overlap.
I do think overlap is good to avoid between growth and dividend ETFs. This is why I love VGT + SCHD, personally. They have only a 3% weighted overlap. But there are many great ways to build a quality portfolio.
SCHD and SCHG are my largest holdings!
Thanks for the comment Will. Two of the very best ETFs there! Can't go wrong. I've been impressed by SCHG the last few years (compared to QQQM, my favorite 'that' type of holding). I definitely have my eyes on it.
I am a Chinese investor, and it is very difficult for us to invest in US stocks due to some policy reasons? But I already have 200 shares（schd）, I hope this is a good start. thanks jeff
I think 100 shares is a great start for SCHD. You're doing great!
@@JeffTeeples thanks
I’ve reviewed SCHD before, it’s good but I’m hesitate to invest with the 30% dividend tax I need to bear, this effectively lower the yield to slightly more than 2% only.
Thank you for the comment. Yeah that is a bummer, and growth is likely the better bet for you. Wish it was the same there as it is in the US.
I have 526 shares of SCHD and plan to take my small pension (lump sum option) and put it in SCHD
I think SCHD will create a nice pension like fund that also crushes inflation over the years (:
Seeking Alpha is awesome btw.
It is my favorite site by far for this stuff! I like the organization of the information, the screeners, and it is my favorite portfolio aggregator by far (because the research is always a click away). I used to use Wealthfront for that.
Just bought 1388 shares yesterday in my Roth.
Hey Michael. Very nice! Sit on those bad boys and watch your cash-flow increase for decades to come (regardless of the price fluctuations. And to be clear, the price *will* also go up when you zoom out, but short term can be all over the map).
Another great video Jeff. Love your simple but effective investing style. Are you on Twitter?
Thank you for the positive feedback, Craig. Much appreciated. I’m not on Twitter (X) as of now, but I’m sure there will be some expanding in the future. Never been a big social media user.
Can you do an update regarding the stock split they just announced?
Hi Maria. I will definitely be making an SCHD video in the near future that will address the quarter 3 dividend along with the 3:1 share split.
@@JeffTeeples thank you! I really appreciate all the information you provide! I'm sharing all your content with the 20-30 year old nurses I work with! I hope they can start sooner than I did!
Loving your deep dive and insight. I will be buying more shares this week.
Very nice, May. It is a good one to accumulate shares of. It never wows us, but just a consistent performer.
Great video! Instead of doing a scenario that started investing 11 years ago. Can you do one where you start investing into SCHD starting this year with maybe idk 100k?
Hey Tony, thanks for watching & for the feedback. Unfortunately I can't model out SCHD using current data, because these things need history to work (showing trends, growth, etc). I mean, I could do it using the current figures and assumptions, but the point of this particular series is to show how SCHD 'actually' performs. Not forecasts assuming X factors.
I mean, technically, this series will show that. It's why I'm including year by year breakdowns (next year I want to update the spreadsheet with price as well). So, the idea is that you'll be able to start anywhere within the window to see how it has actually played out (not what hype videos project for the future). Will be fun to see the trends over the years.
@@JeffTeeples thank you for explaining! That makes alot of sense. Looking forward to the next video.
Tony
Jeff. What do you think about Artificial Intelligence ETF’s? ARKQ, AIQ, ROBT, BOTZ, IRBO, IGPT? I was thinking about making an M1 pie of these AI ETFs. They have been on fire for a while and I think they are the future. Thoughts???
I'm a big believer in AI being the next big thing. However, I like to get balanced exposure to it. I believe more in tech at a high level, long-term, than AI specific stocks or ETFs. A lot of the hot topic picks end up falling face first. I like things like VGT and VOO to get exposure to any new top tech trend, including AI.
Don't get me wrong, they might go to the moon. It happens all the time. But I've seen more things 'like this' go crashing down long-term. It often times makes us have to 'time it' to get a decent exit. I like owning tech, at a high level, forever. Then I know I'll have a slice of the companies that *really* won the race, years from now.
@@JeffTeeples Yes. I’ll watch these AI ETFs before jumping in. But I will be investing heavily every week into VOO, SCHD, VGT, QQQM.
So for a dividend portfolio outside of my 401k and other growth investments. Would you go all in on SCHD?
I think there are a lot worse ways to go than SCHD. It isn't a bad ETF to go all in on. It is the only ETF I hold for value / dividends in my core long-term portfolio.
However I also hold a third of VOO. It or VTI gives broad market exposure.
I also hold a third of VGT + QQQM (they combine for a third).
I like a balance between a good cornerstone (VOO), a value/dividend ETF (SCHD), and growth (VGT/QQQM).
If I had to pick one holding to go all in on, it would probably be VOO. It is a nice mix of value (SCHD) and growth (VGT/QQQM).
Another great educational video. We are interested in review and video of JEPI. PLEASE do a JEPI REVIEW.
Thank you Seginald. I really appreciate the positive feedback! I will throw JEPI on the official 'to review' list. I'm trying to work through the major ETFs that I follow. JEPI is one of them (:
@@JeffTeeples JEPQ as well plz :)
Definitely will be some JEPQ videos in the future as well. Thank you!
Hmm, I wonder if you paired SCHD with DGRO what the result would be???
I’d be happy to watch that video if you’re willing to share it with us lol
I think I need to make one like that! 100% portfolio of all of my favorite dividend ETFs. I could share the yield and growth rate. I’ll note that for future videos. DGRO is awesome.
COST paid a special year end dividend of $15 per share. Since SCHD held over ten million shares of COST on the ex date, there will be well over $150 million extra to distribute this quarter
Edited: COST is in SCHG, but not SCHD.
COST is not a holding in SCHD
Thank you for clarifying. I double checked this and found you to be spot on. I look at so many ETFs and I see COST all the time, but not in SCHD!
Thanks guy for fact check guys, I confused my VOO research #seniormoment
@@COUSINELVIS haha, I didn’t catch it either! I confused SCHG and SCHD. So you’re not alone here (:
Any idea when the reconstitution is happening. I thought it would be today, 3rd Friday of March.
It is going down today. I will be reading about it hopefully tonight. I’m not sure exactly when we will see the info. I’m on the go right now, but can’t wait to check it out later.
Wow so lucky to have found this Channel. Im 34. I Have about 120k in a self-directed IRA. Do you recommend this ETF or is there something better being that I don't need to worry about taxes? Thank you and Godbless.
Thank you for the positive feedback & the question. I'm glad you found the channel too!
Not financial advice here, but... In your 30's you will likely want more growth and cornerstone holdings mixed in.
I'm 41, and I go with a third each of VOO / VGT / SCHD.
VOO is the cornerstone (owning the 500 largest companies in US, known as 'the market', and what everyone tries to beat). VGT is a growth ETF that is 100% technology. If that is too much tech, I highly recommend QQQM for the growth section. SCHD is the cash flow section that pays and grows dividends.
You don't need to worry about tax implications in your IRA. They are treated identically (you'll be taxed when you take the money out, at your current tax rate in the future when you retire). Dividends and growth have the exact same tax implications.
If you go with a nice mix of VOO / QQQM / SCHD (let's say 40% VOO, 35% QQQM, and 25% SCHD at your age), be absolutely sure to NEVER sell your QQQM or VOO (or anything really, but especially those) when the market is down. If you lose 40% of them in the next crash, be a buyer only. You're picking up more shares of a great asset at lower prices.
'Eventually' they will hit another high. The only way to lose with a modern portfolio like this is to panic sell when things are bad (you're giving away shares for less $).
@JeffTeeples wow thank you so much for the reply. Wish I found this chancel before.
Hey Jeff,
Thank you for your video.
Could you make a video related to DIVO and/or other covered call "enhanced" ETF's ?
What's your take on those ?
Perf. wise as per portfolio visualizer, DIVO = SCHD in Total Returns.
Would love your opinion on those.
Thank you and keep going !
Hey Filipe. Thank you for watching and for the question. I like those derivative ETFs for producing high yield NOW if cash flow is needed NOW. JEPQ is my personal favorite. I love it for 'greedy cash' in my portfolio.
However, I think DGRO, SCHD, and VIG ETFs are better for 'long-term cash flow' because they are always growing the dividends. When you zoom out, they pay a lot more money over 20 years. These are better 'investments' in my opinion.
I'll try to drop some more videos on the topic in the future.
@@JeffTeeples Thank you very much for your time and informative answer!
Thanks for the SCHD motivation. Doesn't it recalibrate this month? Is it waking up just now? It is my BND replacement, along with 5-5.28% in MMA settlement funds, at least for now. No dips lately, so I've been neglecting it a bit lately.
Thanks for the feedback & question Karl. It sure does, it has the reconstitution on the third Friday in March. I can't wait to see. Potential video! Although I will only be able to make one the next couple weeks, so may be a bit late, or missed this time around (out of town for a little bit).
Great content! Thanks 🍻 Does Vanguard offer an equivalent to SCHD?
VIG is close for Vanguard, but I still prefer SCHD
VYM
Hey Scott, great question. I ironically don't have a Vanguard account (I went with E*Trade to never run into this first party only issue), but I think the answer is yes. Can anyone confirm?
I like SCHD better, too. VIG is nice, but quite a bit of tech, and a very low yield. I get my fill of 'that' with VGT. I love the 1-2 punch of SCHD and VGT. Together, the yield is similar to the VIGs of the world with way higher total returns.
VIG and VYM are great, to be clear. I don't think we can go wrong either way.
Funny, just mentioned VYM in my last reply (before seeing this). Another quality Vanguard offering.
New subscriber. Thanks for your education.
Thank you, Enid. I appreciate you watching and subscribing! I hope to add more value in the future moving forward.
Hi Jeff. I’m thinking about getting out of my real estate and just paying the capital gains on $2M sales instead of 1031 into the next properties. I was thinking about investing the proceeds into.
1. VOO 25%
2. QQQM 25%
3. VGT 25%
4. SCHD 13% / DGRO 12%
First, is this a good portfolio to just park a large chunk of money into, over $1.5M and just let it sit for a long time. Second, would you roll the entire amount in one chunk or dollar cost average chunks at a time? Maybe, $50,000 to $100,000 a month until it’s all exhausted out of the M1 high yield savings. Let me know what you would personally do? I value your opinion.
Big moves! I love that portfolio mix, especially if you are going to stay the course with it for at least 10 or more years. The growth ETFs like QQQM and VGT will commonly fall face first in the short term. The rollercoaster goes up over the long haul (not just over the past 10-15 bull years, but zooming out 40+ years it is the same story).
The dollar cost averaging vs lump sum investing is always a great debate. There are no right answers. I'm normally a fan of a hybrid system between the two.
Lump sum is 'usually' better because the market 'usually' goes up. However, there is a major risk of seeing large drops at any moment, and I feel that risk is 'higher than usual' right now. Of course I don't know what will happen and when. Nobody knows that.
For me, with $2M, I would likely put $500,000 in right away, and DCA the rest in at $25,000 per week. This would get it fully invested in 60 weeks. Normally I'm a fan of putting half in and getting the rest in there in a year or less. But 'right now' I would take this slightly more conservative approach.
Thank you so much for you time on this. I really appreciate it.
@@JeffTeeples Jeff, does VGT track the Nasdaq? I read it has very similar returns to QQQM? If not, is there a Vanguard Nasdaq ETF?
VGT doesn't track the Nasdaq, however, it has quite a bit of overlap with QQQM. They have a weighted overlap of 48%. So they are about 'half the same'. VGT is 100% tech. QQQM is 50% tech (that is the overlap), and then 50% other sectors.
This makes QQQM a bit more diverse. VGT has had better returns by a decent amount over the past 5 and 10 years. I'm a tech bull, so VGT is what I roll with. But I've considered mixing in QQQM for a little more sector balance within my growth.
Total Returns:
5Y: 158%, QQQ 144%
10Y: 538%, QQQ 453%
They are both great. QQQ is actually better over the past 20 years. They both have SMASHED the market.
PS: Using QQQ because it has the history. QQQM is too new. But they are 'the same' outside of the slight expense ratio difference.
@@JeffTeeples Wow. That’s awesome. Thank you Sir.
I have a video idea for you, mainly because I have been searching for like a month straight and cant find a single one.
Scenerio: you have $500,000 to invest, but you lost your job and/or business and not sure if/when you can get back to work. What kind of high yield investments could you put that savings into in order to maintain the 500k while also giving enough dividends to make about 40k? At the moment you could put into a 5% CD and make $25,000 a year APY, drawing out about 15k per year until you get back into business. 1-2 years that wouldn't be a terrible idea, but they may start cutting rates soon. Would it be worth putting together a portfolio of stocks like BTI, MO, high yield etfs, etc?
Love the video idea Jonathon! Will throw this on the ideas list. I know a big portion of my $500,000 would go to JEPQ. I love that one (great index, high yield, and I don't mind the high volatility of the Nasdaq-100, long-term). I would have to throw together some other holdings to get the best combination of dividend growth, stability, and to hit that $40,000 / year mark. Putting this on my video ideas right now.
@@JeffTeeples I def appreciate it. Everytime you make a post of stocks & income everyone flames you for yield chasing. I feel like this is a solid question tho. Might have come into some inheritence, sold your business, been saving for years, etc then you get hurt, covid shutdowns, get fired, lose job whatever it may be... Surely theres a better way than just eating away at your savings until you find something
Brother and I buy $150 total every Friday. At like 60 something shares
Very nice! Thank you for watching. Keep buying up that SCHD for the long haul!
@@JeffTeeples we want to pass it to our children, not for us
Jeff can you share links for the comparison website you show comparing funds , also what site do you use in these video to get the profile information
Thank you for watching & for the question.
I do back tests here:
www.portfoliovisualizer.com/backtest-portfolio
Then all of the information is from Seeking Alpha. It is my favorite site to research stocks and ETFs. I have a link in my video descriptions if you're every interested in trying Seeking Alpha Premium for free and saving money if you like what you see.
Hi Jeff, just wondering if you could do a video sometime in the future on when someone should take social security. My full social security payment is age 67, I am thinking to take it as early as possible, ie at age 62 and then fully invest the money in SCHD. Assume no price appreciation and only considering SCHD dividend payment, with 10% annual increase on dividend, I think I will be better off to start taking at age 62 than wait till age 67, unless I live until like age 95, which is not too likely. Many people say you should take as late as you can, but I am really not sure that is the best option. I will be 60 in a few months. Like to get your insight on this. Thank you!
Hey Cindy! It's like you're reading my mind. I've been working on a video (although I have been out of town a bit lately, not sure exactly when it will release) that covers this topic.
It doesn't go into depth, and it is situationally dependent for sure. But, 'in general', for people that invest in assets that pay qualified dividends (great for taxes) like SCHD, it is better to take SS early. I use myself (rough plan) as an example in the video. Again, this isn't one size fits all advice, and I explain the breakeven being a fairly young age (I want to say 77 years old in my case), so 'on paper' it may look like waiting is the best option. However, for 'most' investors, taking it early is the better play, long-term, mathematically.
Thank you Jeff, I am looking forward to your video, no rush though 😊
Greetings. Currently have 50% SCHD, 30% QQQM(and building) and 20% SCHB in a roth ira. With SCHD having such good downside protection, what are your thoughts on perhaps dropping SCHB (which is essentially playing the 'safe' role) and increasing SCHD/QQQM ,or, adding in another high earning ETF like DGRO or JEPQ to replace SCHB ?
Hey Seth. Thanks for watching and for the question. SCHB is solid. I think holding it isn’t a bad move.
I do like more QQQM, or some DGRO as a potential replacement, too. Because you have a nice chunk of SCHD already, I would probably add to QQQM, personally. Assuming you don’t need more cash flow now and are building this thing for the future.
I may have missed it, but when you run your analysis of SCHD & VGT illustrating that a beat of VOO each of the last ten years are you rebalancing at the end of each year or no rebalancing?
Hey Mac, thank you for the question! It is using rebalancing at the end of each year (I have done so with new dollars buying the underweight one throughout the year, but the official backtest had a rebalance).
However, regardless of timing and weight, 50/50 SCHD/VGT has outperformed VOO each of the last 10 years. So it's more of an 'in a vacuum' study. But to your specific question, the numbers that show the totals ultimately DO have annual rebalancing on. Here is the video:
ua-cam.com/video/IQpqYM0NqXk/v-deo.htmlsi=jS3_GyxogIrcQuXr
Sunday but school is in session. I love Sunday school
Haha, nice. Thanks for watching Vic. Appreciate the continued support.
If you combined another dividends fund with schd would you likely choose dgro, jepi or jepq
Hi Mommy-Investor. I would add DGRO if it was for a long-term dividend ETF position. JEPQ if it was for short-term cash flow that is needed right away.
Since SCHD is getting dividends throughout the year, but paying them out to you quarterly, what does it do with the dividends in the time in between (assuming that you don't reinvest)? Does it keep a portion in cash to pay out the non-reinvestors?
Hey Duncan. Great question. The ETF managers will collect money from the individual companies throughout the quarter, and then pay them out at the end (or reinvest them based on preference). I don't know 'exactly' what they do, I'm assuming it is in cash pending for a payout or a reinvestment.
Thankyou Jeff !!
Can SCHD be used to hold excess cash which I would like to get better returns than CD and money market, but take minimal risk? What are your thoughts?
Also is it better to hold in taxable Ira or roth ira?
Thanks for the feedback & the great questions. As long as you have an emergency fund and no credit card debt, I would say yes. Excess cash could be held in SCHD. This is actually somewhat how I view my SCHD. Don't get me wrong, it is a great long-term investment, but it does its work with MUCH less volatility than VOO and VGT (my other two main ETFs).
People will argue that CDs and T-bills are paying 5% compared to SCHD only being around 3.4%. But they forget the part where SCHD doubles every 6 years so or by holding the same exact shares. The dividend growth gets lost in the shuffle.
SCHD pays qualified dividends, and is equally effective in any account. With a Roth, you never pay taxes. With a taxable account, you pay taxes, but the best kind possible (long-term capital gains tax table, and it doesn't add to your income). I have more information coming out about this in a video soon. But I prefer my SCHD in a taxable account.
The dividend tax can be zero percent, and the price appreciation tax can also be zero percent, in a taxable account. More to come (:
525 shares and counting. Want to own at least 600 shares by year’s end, hopefully more.
That is amazing Andy. Keep grabbing those shares! 500+ is a nice snowball you’re building up.
When does SCHD pay dividends? I want to buy some shares, but I don't want to miss the dividends. otherwise I think I should buy shares on VYM since dividends will be paid towards the end of March. Any thoughts ?
Hi Shirley! Thanks for watching and for the question. SCHD pays quarterly dividends in March, June, September and December. I think the ex-dividend date will be in a week and change from now, so there is still time to buy & collect the March dividend.
How come the Dividend Growth rate metric gets a D+ on seeking alpha? That seems pretty bad...
That is grading the trailing twelve months only (least important for long-term investing as far as growth). It only increased by 3.77% in the past 12 months. If you zoom out more, it has the following:
Growth Per Year
3Y - 9.43%
5Y - 13.05%
10Y - 11.39%
Why don't you mix in a yieldmax funds for higher distribution to then buy more schd?
That is not a strategy for me. I do understand the logic, but paying 0.99% ER or higher per ETF will take long-term returns no matter how you slice it. In fact, that will take about 28% of your wealth over an investing career. The compound impact is wild.
I think it can make sense to have a low-cost, high yielding ETF to push cash-flow. Not for me personally, I'm all about the dividend growth + total return in time.
@JeffTeeples I think you are missing a serious investment growth mechanism here worrying about 1%. With 25,000 dollars investment into AMZY will net 700-1000 a month. That is the same yield of investing over 250,000 dollars into SCHD. Instead of reinvest back into yieldmax just buy SCHD with the premium. Imagine how much faster you can get to your goal buy adding 12k a year into SCHD by using yieldmax premiums. In 2 years the premiums from yieldmax max would have paid off the 25k you put in. It's a new world with new tools. I made $8800 from last months premiums. Over a year period I'd receive 105,000 in premiums. If I were to invest in SCHD I would need 3,000,000 to get that same yield. I'm only using 175k of my money.
I respect your view on this. I am going to make a video soon that breaks down the long-term results of this scenario. There is merit to what you are saying, but I think you will be floored by the scenarios.
@JeffTeeples great video idea, I'll be happy to watch it. Ya I definitely have concerns with yieldmax especially taxes and what you mentioned. Not saying to make it the main holding strategy but I don't see the harm in buying a certain percentage of portfolio to increase available cash to reinvest elsewhere. That's all I'm saying haha
Hi Jeff, I am already retired. I am living off of my savings and SS. Previously you have advised me to divide my savings into VMFXX, SCHD and a little JEPQ. Currently I am looking for around $8K per month in PRE Tax dollars, Do you have a tool that you are sharing to members (thats me!) that would allow me to to visualize the above mix and how I would piece it together to start creating that income immediately?
I do. It should actually do exactly what you need. It’s the dividend projector Google sheet. If you make a copy you can put in your information. The Google Doc will explain how to use it.
You will update the blue stuff (your holdings, shares, current yield, assumed growth rate (I use the lower of 3 and 5 year dividend growth rate, from seeking alpha). I just updated the sheet, so you can zero out holdings you don’t have, and change the shares of what you do have (like JEPQ, SCHD, and VMFXX).
You can also change the assumed dividend CAGR (dividend growth rate) to be more conservative if you would like. Anything blue text can be changed without breaking it.
Thank you sir. Great show!
Is it a smart idea to only invest in SCHD until retirement? Currently have 3800 shares of it. I max out my roth ira every year towards it. Any thoughts?
I'm not a financial advisor but I was told to never keep all your eggs in one basket. IMHO, if that's the only thing in your IRA but you also have a brokerage account with other holdings, then I wouldn't lose sleep over it.
@twoturntables9153 Thanks a lot. I do have a brokerage account with VOO and QQQ. But I'm not highly invested in them other than SCHD.
Last year was a perfect example why that's a bad idea when tech growth dominated the market. That's y I believe everyone should have at least some exposure to growth no matter ur age. I hold growth funds like schg and xlk in my brokerage.
Very nice G Money! 3,800 shares is impressive.
In reality, you'll likely want to have a variety of assets when you retire. You can sprinkle in other dividend ETFs, money markets, T-bills, high yield dividend ETFs like JEPQ, etc.
However, SCHD, in my opinion, can safely be the lion's share of your portfolio. The screener has a bit more depth than that of DGRO and VIG (they focus exclusively on dividend growth), and it is 100 quality companies. You'll never be out of balance by sector, and heavy in any one company.
It's funny because I often see people say 'eggs in one basket is dangerous', so they pick 10 to 20 dividend stocks instead to diversify. In reality, they have WAY more eggs in one basket, AND, they have to keep up with the news and potentially time the market.
ETFs are not 'eggs in one basket'. I do always like to make sure the ETF has a hefty AUM though. The popular, low-cost ETFs like SCHD are 'usually' good to go on that.
VOO and QQQ are great holdings to pair with SCHD. QQQ is one you'll want to never sell during a crash (if anything buy more), because it will have volatile swings.
keep pumping out those financial informational videos Jeff!!!! i buy SCHD and SPYI weekly ($150) into each.... what is your take on SPYI???? is it too early of an ETF for you to start investing into????
Thanks for the kind words & the question, Kevin.
Funny timing, I have been casually watching SPYI for a while, and I just took a deeper look yesterday when I was sitting on the couch with my kids watching their tablets.
It's hard for me to get over the expense ratio being 0.68%. I understand it's actively managed, and I totally get it. But that will cut into the long-term returns. The yield is juicy! I'm in wait and see mode with that one.
I’m confused why on my brokerage app the divi shows .71 cents but you said in the video it’s 2.69$ a share. Is that 2.69 per year?
Thank you for watching and for the comment. You are correct. It is the yearly dividend per share vs last quarter.
Hey Buddy, could you please compare SCHD with JEPQ. Thanks
Hey Nelson, will do. I'm planning on making a video for JEPI and JEPQ soon. And many more on SCHD (since it's a big portion of my portfolio).
I will try to mix in some comparisons, even though they are night and day different as far as portfolio purpose and fit. Still fun to compare though!
Thank you, Jeff. I appreciate it. I would love to understand why they are day-to-night different. I can't wait to look forward to those new videos. Great Job, thank you
@@njmeneses I own both and I’ll give a quick summary.
JEPQ is superior when it comes to yield now. It makes SCHD look silly in that regard (nearly 3 times more cash flow).
But, SCHD grows its dividend to where years later it will make JEPQ look bad per dollar that was invested. It also is better from a tax perspective.
Shorty version is buy more JEPQ if you need cash NOW, and buy more SCHD if you want more cash in the future.
If SCHD keeps up its dividend growth, it has a yield on cost of about 29% for dollars invested 20 years ago (it seems unrealistic but the growth snowball is awkwardly good). Even if it slows down (I’m using its 10 year average of 11.39% per year for that figure) it will run laps around the JEPI and JEPQ of the world.
@@JeffTeeples Thank you, Jeff. I am new to this so I need time to process all this hahaha.
Thanks 🙏🏼
Thank you for watching! I appreciate it.
Isn’t there supposed to be another dividend payment this month??
Hey Alex. Absolutely. We are getting another dividend payment later this month. I can’t wait.
I’m 77 , should I dump my 40 K on savings in this stock ?
Thank You
Hey Tim. Thanks for the question! The answer is that it depends.
I would say you're safe to dump at least a portion of your 401k into SCHD. How much will depend on how much you have.
If you have something like $100,000, you may want to explore other higher yielding ETFs such as JEPQ. However, if you have a pension and/or social security covering your bills, you could probably go all in with SCHD. SCHD is awesome in taxable accounts in retirement because you will (usually) pay 0% taxes on the dividends received (special tax table for qualified dividends, they are taxed like long-term capital gains).
If you have $10,000,000, then growth ETFs and cornerstones like VOO and VTI may be the best path, with a touch of SCHD.
It depends on how much cash flow you need, but I would say you can't go wrong with SCHD. It will not be a complete mistakes (like going 100% into a growth stock or ETF can be at times).
Hey Jeff- I cant buy SCHD do to my wifes job. what other one would you suggest? thanks
Thanks for watching and for the question. That’s a bummer. For dividend ETFs, I think DGRO is a solid replacement. Lower yield, but nice dividend growth.
Neither will match the total returns of the top growth ETFs over long stretches of time, generally speaking. But I love the consistency and stability.
@@JeffTeeplesthanks
Hi Jeff - I own SCHD and this video really helped me understand the value of this outstanding dividend growth ETF.
If you had to sell your shares in SCHD, VOO, or VGT to obtain some cash in the short term, what would you sell first?
Hey Bruce, thanks for watching & for the question. If I HAD to sell (I hope to not have that happen pre-retirement), I would sell the one that is the most above its allocation.
For example, my goal is 50/50 VGT/SCHD (with VOO also being a third, but it is in a 401k as I can't sell it yet). So I like a third of each, but I can only 'control' VGT and SCHD at the moment.
If VGT was 52%, I would sell it back to 50%. Same story with SCHD.
Instead of selling when I quit my job to start this channel (6 figure salary was nice, but this is worth it), I picked up some JEPQ for the temporary dividend boost (so I wouldn't have to sell).
Oh, and anything I sold would be either a loss, or a long-term capital gain (held for at least a year) for tax purposes.
This is great!
SCHD bringing the positive vibes. Thank for watching Johnny!
So sad that this ETF is not for us in Europe (Italy)... :(
It is Luca. I really can't stand that aspect of investing. Sorry ):
VOO minus .11% for the day, VGT at minus .46%, and SCHD finished up .57%. Thats what I call SCHmoothing out the bumps
I love how SCHD is commonly opposite of VGT. Great team.
Thanks!
Wow Brianna! I really appreciate the support. That is very kind. I think it is my 3rd super chat ever! Thank you!
Is there an SCHD alternative that pays monthly?
There are quite a few dividend stocks and ETFs that pay monthly dividends in general. I do not know of one that replaces SCHD. The only monthly payers that I have invested in are JEPQ and JEPI. But these are for a completely different dividend need (higher yield, lower dividend growth rate) than SCHD.
The quarterly vs monthly difference is negligible. I know monthly is nice for that flow, but if the two ETFs have the same yield. You'll get something like $3k every third month instead of $1k per month. This is why I personally just look for the best stocks or ETFs. From my experience, most of the best investments happen to pay quarterly (again, this isn't a hard rule or anything).
So it’s OK to have SCHD in a taxable account
It is. I would actually go as far as to say it's great to have it in a taxable account. Dropping a nerdy video explaining that in the near future.
It can be taxed at 0% forever, including capital gains, for many people. It weirdly can turn a taxable account into (basically) Roth treatment.
I have 17k invested I am ruining my portfolio by doing 80% SCHD and 20% JEPQ is this smart?
Thanks for the comment and the question. This will depend on your goals and time horizon. If you are getting close to retirement or in retirement, these are both incredible.
SCHD I think is great at all stages. JEPQ is probably best if you need cash flow now. If you're investing for the future and plenty of income to pay the bills in the short term, I would suggest a mix of VOO, VGT, and QQQM. The selections will again depend on your goals.
Bottom line, you could be doing a lot worse than those two ETFs.
@@JeffTeeples I am in my 30s just got married and I had to put down a big chunk of my VTI in a house down payment. Like 75k. My wife is not 100% sure about stocks so I have been showing her how we can “make 1.70 dollars in dividends a day with this portfolio” we are 0 credit card debt and putting 1.2k a month in stocks now. The problem with Jepq is how much it hurts my appreciation and taxes over time correct? Is easier to explain/show to the wife the dividends coming in than the “selling a chunk of the VOO portfolio in old age.” Strategy which she doesn’t like. What would you do in my shoes? VGT, SCHD
I think your mix is solid. I would likely add in some QQQM, SCHG, or VGT (or a mix of them) to add some growth to the mix. You have value covered with SCHD.
But long-term, what you have will work too. It's all about staying the course and continuing to be a buyer only. Never panic sell and you'll do well with any mix (I mean, any mix with quality ETFs of course, which you have 100%).
Different people take a different approach. So many right ways to go about it.
Ilke SCHD, DIVO & DIVB.
Thanks for sharing. Nice dividend combo there!
I have watched 8000 SCHD videos and this is 8001
What did you think of it?
SCHD's methodology to pick stocks is good but not great. Its decision to eliminate stocks that haven't paid dividends for 10 years eliminate new dividend paying companies like META and CRM, which have great stock appreciation potential.
Thank you for watching and for the comment. You are talking more about growth ETFs (as far as picking up META, for example). This is why they generally outperform the best dividend ETFs in ‘most markets’ on total return.
VIG and DGRO will not pick up companies until they have many years of dividend growth by design. They sacrifice total returns for an emphasis on dividend growth. This is why they are a nice addition to growth ETFs.
SCHD is similar, only it also confirms dividend sustainability and yield compared to VIG and DGRO with a couple additional screeners. It is a step more towards a true dividend ETF like VYM for this reason.
It’s why SCHD is my favorite to combine with the crazy VGT, very little overlap and amazing counterbalance.
You’re right in that SCHD won’t pick up new dividend payers. But that is by design and honestly kinda the point for a floor stabilizer.
Do you have family in Baton Rouge?
Not to my knowledge, lol. Most my family lives on the west cost of the US. WA, OR, CA.
What are your top 3 GROWTH ETFs
Thanks for the question Brooks. So
I’m a tech bull, but I’ll just go with one of those because I want some diversity in the list.
VGT (could also say XLK)
QQQM
SCHG
Maybe that group. So many great ones though, could have multiple honorable mentions.
Something like SMH has been better, and it’s great, but way too niched down for me. Not saying it’s bad at all, but just explaining those are the 3 ETFs I would actually invest in.
Is there a mutual fund equivalent of SCHD and VGT that you recommend? Automatic investment can only be set up with mutual funds in my provider.
Hey George. Thanks for the question. Not that I know of on SCHD. VGT has one, called VITAX, but it has a (quite ridiculous) $100,000 minimum investment required.
Please tell us about your portfolio in a future video.
Will do!
Still SCHD buy?
Absolutely. Nothing has changed for me.
@@JeffTeeples thank you
Schd,schg,Voo ,FTEC and 😴
I love it! Load up on quality ETFs and reeeelaaaax. Living the good life!