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Excellent video Personally I have a 3 bucket portfolio 60% SCHD and DGRO (now money) 25% VOO (5 years money) 15% VGT (10 years money) I believe the growth is a must to have During retirement because of the hyperinflation periods that we just went through and unfortunately we don’t know what is coming next 😢 Keep the great work
Great strategy! I like the 3 bucket strategy. What about cash or short term investments? I’m assuming you also have a cash/short term investment bucket as well
god watching these videos makes me so happy, ima 19 year old canadian who got into investing a few weeks ago, with my current pay i make about 75000 a year and am living with my parents so expenses are at an all time low, hoping to be able to retire by 50 or at least start working part time and enjoy my fourties’ instead of working construction for 50 years like all my coworkers
Love your content! ETFs pays! I have a considerably large collections and position on SVOL, SCHD is about 35% of my Roth IRA SPDR S&P 500 value Tilt ETF is about 31% of my Roth. The rest is covered call ETFs for all 4 US market indexes, international, extra concentration with sector ETFs with energy, health care, utilities, WTI futures and general commodity futures ETFs. these allocations balance out my portfolio.
Hi Tim I am so big on individual stocks and it has worked well for me, but I also like to have a well balanced, low-cost set of ETFs that keeps the money in my pocket. I'm impressed with your selections how effective are your ETFs approach returns on the long run with this lot?
Superb jacob adhering to well established patterns from a professional standpoint would make you love high yielders efts! I've set up a spreadsheet of high yielders, total allocation to each position, monthly dividends (avg) and I got to say I'm going all in when the time is right (double). I mix both high and low-medium yields in my portfolio, but the higher yielders is the way to go on efts.
Cheers I'm looking to start a position in SCHD, JEPQ with dividends of existing stocks. It's going into an IRA and I'm really looking for growth over time. I will be reinvesting dividends, so my position size will grow. Okay if I get introduced to your viewpoint, I need similar performance on mine.
Excellent video. I consider myself a veteran investor, but need reminders like this from time to time. This would be absolutely PERFECT to show a newer investor.
What a great video! It’s like my entire channel in one video. Time horizon is the most important metric for a DGI type of investor. Love to see someone give the DHS ETF some love too!
Magic. 🎉 First time I've seen that model. I've done some of that on my own organically but not intentionally. Now i can see why some of my outcomes were more likely to have happened the way that they did. I only got into looking at dividend growth rates, coverage ratios, payout ratios, and such the last 2 years. The quality screening has made a huge difference in annual dividend income. Cool to see a prescriptive model. Subscribed! P.s. congrats on FIRE!! 🥳
This has to be one of your best videos that you've put together I really enjoyed it the content and it definitely gives direction to Both Younger and Older Individuals for retirement. Nice Job🎉
I like the idea of building one's own Target Date Fund. It's been my experience that the recipes used by fund management firms is to be much too heavily invested in international funds. Not my preference. Using your ideas, an investor can expose themselves to as much or little as they are comfortable. Good Job! I also ascribe to a version of your core and satellite strategy. Nicely thought out approach. Cheers
Looks great. I like it. I’m more into a dividend portfolio since I’m retired. I own stocks like SCHD, VYM, SO, DUK, O, WPC, FRT, OHI, VICI, CVX, SJM, UPS, UGI, CAG, GIS, TFC, JPM, C, GPC, UNP, VIS, EPD, BMY, PFE, LYB, OMC, PEP, MFC, RY, BNS, PRU, PFG
A lot of great companies you listed!! I think you may be interested in covered call ETFs for more income. Something to check out. Watch those expense ratios though!
I always kept thinking I was about 10 years away from retirement until suddenly I realized I could retire, but if I waited a bit then my retirement would be more comfortable/flexible. At that point I started to really focus on accumulating cash just in case I retired (or was forcibly retired) into bad market conditions. Now that I am retired I've been picking up some REITS and covered call funds just to boost my yield and doing some pre-tax to Roth conversions.
switched half my portfolio to XDTE and QDTE, huge bump in income, not living off the income yet, but will need to reinvest a portion to maintain nav, but so much better than JEP funds or others
@@Alex-he1ve they aren't meant to take the whole distribution. It needs a percentage put back in. A lot of funds like yieldmax funds need 70-90% reinvested. Also need to know the underlying.
ive watched this video several times over the last 2 years in retirement. it makes a lot of sense and all my fesearch so fsr contknues to support this is a good strategy.
I highly suggest to anyone reading this comment to go out and read or listen to JL Collin’s book, The Simple Path to Wealth! Such an easy read and even better listen if you do Audio Books. After listening to Jake talk about this book for the 784,747,334th time, I finally decided to give it a try. 😆 I get why it’s brought up so much. Great book! Give it a try!
Great video.... are DGRO or VIG taxed as qualified dividends or regular? I encountered this problem as I started to really analyze my portfolio and only individual stocks seems to give you the lower, passive income tax rate. JEPI for example is not considered qualified.
Hello Jake!!!! I watched this video on September 16th 2024 for the first time... watched it a few more times to assimilite everything and to see how i could get a better performance out of my portfolio following the ideas of the video.. at that time there were only two "small" problems: had around 120 company stocks and ETFs (a lot i guess :D) and also i am an european. As an european investor I didnt have the access to the american funds until very recently... Since September I sold a lot of my positions and reinvested in similar ETFs like JL Collins and you suggest - it makes our investing life easier and simpler. Today I have 33 single company stocks and 12 ETFs following your and JL Collins`s strategy - or at least i am trying to follow - using european ETFs with similar goals. Having the european ETFs its a bit different in my opinion. But now I can finally invest like an american!! :) BIG thank you Jake!!!!! Regards, FM
Hey from Germany. I' ve got the same problem. I would like to invest in DGRO and SCHD, but it's very dificult to find similary ETF's. Even if I think to have founden, I compare the assets and they are pretty different. For example instead of DGR0 Fidelity Global Income or Wisdom Tree Dividend Growth. However, they are different.
Thanks for the pyramid explanation, Jake. It makes it easy to explain what I'm doing to others. I have a dividend pyramid (85%) to live off of and a growth pyramid (15%) for future expenses or more dividend purchases if a great deal shows up like Oct 2023.
Hey Michael! I’m always on my computer so I use it more on my desktop but the app is great if you want to check the dividend calendar or see the performance of your portfolio or multiple portfolios from different brokerages in one app.
If I’m 44 couldn’t I use DGRO/SCHD as my core and something like VTI and QQQM as satellite positions for more growth and then sell those positions off in my mid 50s to invest more into DGRO/SCHD and then switch to VYM/HDV as my satellite positions? This video was a great explanation and loved the TDF comparison. Makes perfect sense.. thank you
Think of this as a guide not a rule. That would absolutely work. You focus on a core that meets your time horizon and goals. Keep it simple and stay flexible as life changes.
Im SCHD + DGRO + VOO at 75-80% of my retirement portfolio but do have 20% in TSLA that I won’t sell for 20 years. I want to compare the growth between these and compounding in 20 years. It will be fun.
The big question is what should the initial investment be? If we have to retire in 10 years time and expect a million dollar value at the end of 10 years, what is the starting number to plug in with the pyramid?
Check out my videos on the simple path to wealth with dividend investing. Starting with Schd/dgro is a great place to start in my opinion. Then like I mentioned in the video, treat it like a target date fund and add more income as you get closer to retirement
Hi Jake, i need some clarifications please. So you wouldn't recommend any core positions for those who are on the very top of the pyramid as there are only three satellite stocks?
If you want to retire off dividends, I would have a core of just ETFs and my favorites are SCHD/DGRO. Satellites can be both ETFs and individual stocks. Look at this as a guideline not a rule.
Hi Jake! Do you use any calculator to figure out your (let's say) monthly income from your portfolio? If Yes, please advise one. Like you enter your amount of money you have on you account and your etfs (for example, amount is $500k, schd - 40% of portfolio, dgro - 40%, dgrw - 20%) => click Ok to calculate monthly income.
62 years old looking to retire in 5 years; lump sum to invest in a traditional ira, do not plan on adding to holdings. Advise where to start on the pyramid?
I have questions. I plan on keeping attention a small portfolio. 8 to 12 holdings total. How many core stock or ETFs should I have before adding the satellites?
Great Video as usual, in opinion, if you have 20+ years to invest, you should only invest in ETF. For average long term investor, it is very difficult to predict the long term future of any company.
I’ve gotta stop watching so many different channels. I’ve got the Core/Satellite approach In mind but I find I’m wanting 3 core and about 25 satellite positions haha..
Jake, I want to book time and talk to you because in my portfolio I usually don't pull the trigger. I did take a big pay cut but the money is still there
So, my question is … does this pyramid work if you are just starting your core? I’m 10 years from retirement so I’m a little late to the game with limited funds. I’m open to suggestions/answers. Thanks all.
Yes you just want to make sure you’re investing in the right accounts for example in the US in a Roth or 401k. Then you want to find a balance of growth and yield that meets your expected expenses for the future.
Great rule of thumb and general primer… Imo going into a more advanced level… Some companies grow dividend by just having a lower and lower payout ratio. The year over year cashflow growth seems more important to me. Dividends ultimately get paid from free cash flow so free cashflow yield and free cash flow growth and the price you pay in yield for growth seem important to me, but that assumes that these things are predictive. The durability of the business model and longevity of the company, or on the growth side the ability to disrupt and dominate a growing market with improving economics might be more important also. Advanced isn’t necessarily superior. Improving return at the cost of complexity isn’t always a good trade off. If you have a method that works no need to overcomplicate it, but if you’re OCD/obsessive about learning everything and optimizing and increased complexity isn’t going to increase error rate then this info I’m saying may be useful.
Always really enjoy your videos. Good general information. But it really sickening for me as an investor in GB using trading 212 platform i cant invest into SCHD and DGRO which are amongst my favourite ETFs
Thank you, Jake! Great video as always. I am in retirement (65+). Are you saying I should not have DGRO and SCHD in my portfolio? (because I do) and should only have those positions at the bottom of the pyramid?
@@DividendGrowthInvesting Thank you! How do you feel about SCHG vs DGRO? I did a comparison in Seeking Alpha and SCHG outperformed DGRO in Max Total Return but you are a lot better at analyzing ETFs.
Question, I agree with you on DGRO, but why not DGRW? It seems like DGRW is the same thing except it pays monthly, which is good for ME personally when I have a life saving medication that I buy monthly. Is there some other difference between the two I don't know about which I should?
@@DrewBlue32 I see Dgrw as a great satellite position. The high expense ratio and inconsistent dividend growth makes it a satellite in my opinion. But you can see at as a core holding. Think of this as a guideline not a rule
Hello Jake, I was wondering if you could roll in a deeper dive soon into SCHY. I am seeing some dividend growth gains for it in seeking alpha. Right now I'm all SCHD and DGRO. Do you think SCHYs dividend growth will continue to be this big?
Great video! Could you please do a video on SPYD? And compare it to SCHD. Everybody talking about SCHD and DGRO, but it seems that SPYD that has both better growth, and better dividend yield. Am I missing something?
Does it matter how much I put in in the first year? Can I just buy 1 share in year 1 and maybe in year 4 I invest 100k. Does the compund divided growth still working?
it does matter since it compound. let say, if you invest 100k on day 1 vs investing 100k/12=$8,333.33 for each month of the year, that 100k day 1would make more...that is if you investment is value stock instead of a trap dividend stock. you are looking at around 60% differences average wise.
I own DGRO & SCHD as core holdings but I am not sure what percentage of my portfolio should they be. Right now they are my 2 largest holdings but they make up 15% each with a goal of 20% each. Should it be bigger as a core holding or is that just right
Not exactly. Im saying if you want to live off your dividend portfolio, in addition to a core portfolio of SCHD/DGRO, you want to understand which investment vehicles will support your goals. JEPI/JEPQ are a great way to turbo charge your income if you need more income when you retire. They are great options to consider for satellite positions - based on your situation and goals.
Hi Jake, great video as always!!! Just trying to find your opinion on this one. I’ve been actively investing since April and trying to find the best approach to select the timing of my investing following your core/satélite approach. If I’m currently investing $200 monthly and I’m 28 years old trying to retire by my 60’s, would you invest equally based on your target distribution between your core and satellites or would you invest one month into your core and then balance it next month with the other $200 directed into your satellite and some core positions? Or which approach you think best suits in the timing of the investments with the core/satellite approach?
Hey!! Keep it simple and automate it regardless of what the market does. As you get closer to retirement treat it like a target date fund and slowly adjust the target weightings as you invest new money
Good pyramid Jake. You know I still debate with myself. If I could go back 10 years which three ETFs would you put in your taxable, which three ETFs in your Roth? 🤔 So many combinations..
Regulated utilities. I didn’t mentioned this in the video, but be very careful not to rush into buying DUK or SO when they trade at a high PE. You want to buy into these ideally when they have a ~4.5% forward yield. Right now SO has a 3% forward yield. Food for thought :)
@@DividendGrowthInvesting Wondering if Constellation Energy or Exelon are better buys long term than DUK and SO in the utility space because of the low dividend growth rates of the latter.
I noticed it says $0 cash and all the buying power is margin. I currently have level 2 options account on webull and public. I think to get a margin account I need a minimum of $2k. I guess my question is, how can i get a margin account like this? Do I have to start with the $2k and build up the margin? Thanks for anyone that can help explain
There are two reasons: 1) The dividend growth is the second derivative of the value of your portfolio. So if the dividend is the speed at which your portfolio grows, the dividend growth is the acceleration. If your car goes 50/hour, it'll take you 4 hours to do 200, 10 hours to do 500 and 100 hours to do 5000. However, if your car starts at 0, and accelerates by 2/hour, after 1 hour you will go 2/hour, and after 100 hours you'll go 200/hour. The formula is now a * t²/2. So after 1 hour we have done 2/hour * (1²)/ 2 = 1 unit of distance. After 4 hours we have done 2/hour * (4²)/2 = 16 units of distance. Much less than the 200 we had in the first situation After 10 hours, we have done 2/hour * (10²)/2 = 100 units of distance. Still much less than the 500 we had in the first situation After 100 hours, we have done 2/hour * (100²)/2 = 10000 units of distance. Twice as much as in the first example. If you focus on the actual dividend, like with say a PFLT, you will just get 10% a year. (I AM NOT SUGGESTING THAT YOU INVEST IN THIS STOCK IN ANY WAY, I JUST TOOK SOMETHING RANDOM THAT HAS HAD A STATIC VALUE AND DIVIDEND FOR A LONG TIME) Your initial 1000$ input will grow by 100$ a year. After 30 years, you will have a 1000$ investment and earn 100$ a year. If you reinvest your total wealth will look somewhat like this: year 1: 1000 $ / 100$ a year in dividends year 10: 2594 $ / 259$ a year in dividends year 20: 6727 $ / 672$ a year in dividends year 30: 17449 $ / 1745$ a year in dividends year 40: 45259 $ / 4525$ a year in dividends year 50: 117391 $ / 11739$ a year in dividends This is quite good of course. If you were to invest in a stock like VISA WITHOUT REINVESTING, it would look something like this: (again, not suggesting you invest in this stock) year 1: 1000$ / 8$ a year in dividends year 10: 35$ a year in dividends year 20: 156$ a year in dividends year 30: 687$ a year in dividends year 40: 3029$ a year in dividends year 50: 13365$ a year in dividends But here comes the kicker: most dividend growth stocks have their stock price appreciate at a rate that is similar to their dividend growth. So that 1000$ you put into VISA would after 50 years be worth about 1.7 million, completely leaving the previous stock in the dust. The big downside of course is that this requires a consistent growth and performance of a stock and its dividend over extremely long time spans.
I like the mixed approach the best my 457 has s&p 500 and blue chip growth funds pre tax, my roth and taxable has mostly SCHD and VYM, with a few jepi, VNQ. I will be adding vti and schg eventually for more net worth growth.
This was an epic video, and I appreciate your GROWTH approach. Far too many investors gun for dividend yield and it is crushing more wealthy opportunities than not.. If you are up for a face video, I would love to have you join me on Masters of the Market with these insights!
Love the videos. Quick question, how are you living off of ~$30k that you make in dividends? Other question is, if you don't mind, how does this dividend affect your taxes in the U.S.?
Thanks for watching!
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You're a huge influence on my portfolio. My goal is to retire 10 years early. Thanks!
Puts a smile on my face reading this! Really glad to hear that! Thanks for taking the time to watch!
Then stay away from dividends.
@@theowenssailingdiary5239nah that’s just false information
@@theowenssailingdiary5239 Why's that?
@@theowenssailingdiary5239 Why's that?
Excellent video
Personally I have a 3 bucket portfolio 60% SCHD and DGRO (now money)
25% VOO (5 years money)
15% VGT (10 years money)
I believe the growth is a must to have
During retirement because of the hyperinflation periods that we just went through and unfortunately we don’t know what is coming next 😢
Keep the great work
Great strategy! I like the 3 bucket strategy. What about cash or short term investments? I’m assuming you also have a cash/short term investment bucket as well
@@DividendGrowthInvesting
Yes Sr., 2 years of cash in a HYSA
You don't know what is coming next, but you are all in on stocks?
we get a great recession at end of the year
@@relaxandlearn7996can’t recess if you keep printing!
god watching these videos makes me so happy, ima 19 year old canadian who got into investing a few weeks ago, with my current pay i make about 75000 a year and am living with my parents so expenses are at an all time low, hoping to be able to retire by 50 or at least start working part time and enjoy my fourties’ instead of working construction for 50 years like all my coworkers
Your channel motivated me to start my dividend journey. I open up an account which I will contribute to schd daily.
Love your content! ETFs pays! I have a considerably large collections and position on SVOL, SCHD is about 35% of my Roth IRA SPDR S&P 500 value Tilt ETF is about 31% of my Roth. The rest is covered call ETFs for all 4 US market indexes, international, extra concentration with sector ETFs with energy, health care, utilities, WTI futures and general commodity futures ETFs. these allocations balance out my portfolio.
Awesome collections! I like VOO and SCHD equally!
The money man! all this allocation must be giving you good returns.
Hi Tim I am so big on individual stocks and it has worked well for me, but I also like to have a well balanced, low-cost set of ETFs that keeps the money in my pocket. I'm impressed with your selections how effective are your ETFs approach returns on the long run with this lot?
Superb jacob adhering to well established patterns from a professional standpoint would make you love high yielders efts! I've set up a spreadsheet of high yielders, total allocation to each position, monthly dividends (avg) and I got to say I'm going all in when the time is right (double). I mix both high and low-medium yields in my portfolio, but the higher yielders is the way to go on efts.
Cheers I'm looking to start a position in SCHD, JEPQ with dividends of existing stocks. It's going into an IRA and I'm really looking for growth over time. I will be reinvesting dividends, so my position size will grow. Okay if I get introduced to your viewpoint, I need similar performance on mine.
Thanks!
Thank you so much!
The Simple Path to WEALTH: SCHD/DGRO 40/40, FTEC/QQQM 10/10 and you will be able to sleep well.
Glad to see I'm not the only one who knows about FTEC.
Excellent video. I consider myself a veteran investor, but need reminders like this from time to time. This would be absolutely PERFECT to show a newer investor.
Appreciate you taking the time to watch! Yeah I wish I started with this earlier in life
What a great video! It’s like my entire channel in one video. Time horizon is the most important metric for a DGI type of investor. Love to see someone give the DHS ETF some love too!
You know that old saying.. great minds think alike!!!
Magic. 🎉 First time I've seen that model.
I've done some of that on my own organically but not intentionally. Now i can see why some of my outcomes were more likely to have happened the way that they did. I only got into looking at dividend growth rates, coverage ratios, payout ratios, and such the last 2 years. The quality screening has made a huge difference in annual dividend income.
Cool to see a prescriptive model. Subscribed!
P.s. congrats on FIRE!! 🥳
Glad it was helpful!
For a moment there, I thought you were going to write out the definition of a target date fund! 😂😂😂 Thanks for the visuals
lol omg haha
This has to be one of your best videos that you've put together I really enjoyed it the content and it definitely gives direction to Both Younger and Older Individuals for retirement. Nice Job🎉
Thank you!! I appreciate you saying that!
I like the idea of building one's own Target Date Fund. It's been my experience that the recipes used by fund management firms is to be much too heavily invested in international funds. Not my preference. Using your ideas, an investor can expose themselves to as much or little as they are comfortable. Good Job!
I also ascribe to a version of your core and satellite strategy. Nicely thought out approach. Cheers
Looks great. I like it. I’m more into a dividend portfolio since I’m retired. I own stocks like SCHD, VYM, SO, DUK, O, WPC, FRT, OHI, VICI, CVX, SJM, UPS, UGI, CAG, GIS, TFC, JPM, C, GPC, UNP, VIS, EPD, BMY, PFE, LYB, OMC, PEP, MFC, RY, BNS, PRU, PFG
A lot of great companies you listed!! I think you may be interested in covered call ETFs for more income. Something to check out. Watch those expense ratios though!
Loving these videos, thanks for putting out such quality and consistent content
Glad you enjoy it! Thanks for watching!
Next we need The Dividend Meme Pyramid!
lol coming right up! 😂😂😂😂
I always kept thinking I was about 10 years away from retirement until suddenly I realized I could retire, but if I waited a bit then my retirement would be more comfortable/flexible. At that point I started to really focus on accumulating cash just in case I retired (or was forcibly retired) into bad market conditions. Now that I am retired I've been picking up some REITS and covered call funds just to boost my yield and doing some pre-tax to Roth conversions.
29 years old building my core right now with just SCHD and DGRO. Later I’ll be adding a few satellite positions
The simple path to wealth with dividend investing!!!
DGRO 💪🏻💪🏻
Dumping 4k a month into SCHD! Hoping to retire in 10-12 years!
Nice!!! I wouldn’t go 100% SCHD only. Consider combining it with DGRO for more diversification and potential growth
@@DividendGrowthInvesting good thing you aren't an advisor. Give it a rest mate.
@theowenssailingdiary5239
What advisor (or investor for that matter), would be silly enough to recommend or want a single ticker for retirement!?
switched half my portfolio to XDTE and QDTE, huge bump in income, not living off the income yet, but will need to reinvest a portion to maintain nav, but so much better than JEP funds or others
Glad to hear they work for ya. There are many paths that lead to success. Thanks for watching!
I hesitate to invest in XDTE and QDTE yet, afraid of NAV erosion. As I close to retirement I concentrate on SPYI/QQQI/JEPQ so far
@@Alex-he1ve they aren't meant to take the whole distribution. It needs a percentage put back in. A lot of funds like yieldmax funds need 70-90% reinvested. Also need to know the underlying.
I like the pyramid, Jake. Great way to look at investing timeline and dividend growth rate. I wish I knew about this thirty years ago! 😢
You and me both! Thanks for watching!! Hope you’re doing well!
Thank you so much for the info
ive watched this video several times over the last 2 years in retirement. it makes a lot of sense and all my fesearch so fsr contknues to support this is a good strategy.
I highly suggest to anyone reading this comment to go out and read or listen to JL Collin’s book, The Simple Path to Wealth! Such an easy read and even better listen if you do Audio Books. After listening to Jake talk about this book for the 784,747,334th time, I finally decided to give it a try. 😆 I get why it’s brought up so much. Great book! Give it a try!
Hey Mike!! Hahaha yeah it really helped me and I think a lot of people would benefit from the simple approach! Hope you’re doing well!
Great video.... are DGRO or VIG taxed as qualified dividends or regular? I encountered this problem as I started to really analyze my portfolio and only individual stocks seems to give you the lower, passive income tax rate. JEPI for example is not considered qualified.
Hello Jake!!!!
I watched this video on September 16th 2024 for the first time... watched it a few more times to assimilite everything and to see how i could get a better performance out of my portfolio following the ideas of the video.. at that time there were only two "small" problems: had around 120 company stocks and ETFs (a lot i guess :D) and also i am an european. As an european investor I didnt have the access to the american funds until very recently...
Since September I sold a lot of my positions and reinvested in similar ETFs like JL Collins and you suggest - it makes our investing life easier and simpler.
Today I have 33 single company stocks and 12 ETFs following your and JL Collins`s strategy - or at least i am trying to follow - using european ETFs with similar goals. Having the european ETFs its a bit different in my opinion.
But now I can finally invest like an american!! :)
BIG thank you Jake!!!!!
Regards,
FM
Hey from Germany.
I' ve got the same problem. I would like to invest in DGRO and SCHD, but it's very dificult to find similary ETF's. Even if I think to have founden, I compare the assets and they are pretty different. For example instead of DGR0 Fidelity Global Income or Wisdom Tree Dividend Growth. However, they are different.
Awesome presentation!!! I wish I had this a long time ago, it would have helped me tremendously.
Yeah if only! I’m in the same boat!
As long as you continue to answer comments you will always have my audience. Helping you live that barista fire life
:) appreciate it fabi!
Thanks for the pyramid explanation, Jake. It makes it easy to explain what I'm doing to others.
I have a dividend pyramid (85%) to live off of and a growth pyramid (15%) for future expenses or more dividend purchases if a great deal shows up like Oct 2023.
Glad to hear it was helpful!! Thanks for watching!
Great video, love how simple yet effective this approach is.
Glad you liked it! Thanks for watching!!
Thank you Jake. I’m very interested in Snowball analytics. Does it work better on my laptop or my phone or either?
Hey Michael! I’m always on my computer so I use it more on my desktop but the app is great if you want to check the dividend calendar or see the performance of your portfolio or multiple portfolios from different brokerages in one app.
If I’m 44 couldn’t I use DGRO/SCHD as my core and something like VTI and QQQM as satellite positions for more growth and then sell those positions off in my mid 50s to invest more into DGRO/SCHD and then switch to VYM/HDV as my satellite positions?
This video was a great explanation and loved the TDF comparison. Makes perfect sense.. thank you
Think of this as a guide not a rule. That would absolutely work. You focus on a core that meets your time horizon and goals. Keep it simple and stay flexible as life changes.
Im SCHD + DGRO + VOO at 75-80% of my retirement portfolio but do have 20% in TSLA that I won’t sell for 20 years. I want to compare the growth between these and compounding in 20 years. It will be fun.
All great ETFs!! lol that’s a lot of Tesla :)
I'm like-minded in this approach...
What so you think about VGT 100%(20+ years time) then 2-5 years before retirement, move to schd and dgro?
As long as it’s not a food pyramid I’m interested!! 😂
Hahaha :)
eat ur veggies
@@MRkriegs Vegetables sparingly and mostly fermented. Eat meat.
The big question is what should the initial investment be? If we have to retire in 10 years time and expect a million dollar value at the end of 10 years, what is the starting number to plug in with the pyramid?
Check out my videos on the simple path to wealth with dividend investing. Starting with Schd/dgro is a great place to start in my opinion. Then like I mentioned in the video, treat it like a target date fund and add more income as you get closer to retirement
If nearing retirement in 1 year... Are you saying skip DGRO and SCHD?
Appreciate your reply. Keep up the fab work on these videos its super helpful.
For sure!!! Glad to hear it was helpful!
thanks. loved how simple it is, and thanks for the nice way you explained it
What percentage am I supposed to do for the core and the satellite positions ?
60-80% in your core in my opinion.
😂 lol that actually sounds exactly like my dividend portfolio as well. I'm glad I'm not the only that's all over the place thank you Jake 😃
I would throw MO into the mix. That position would be at the bottom of the pyramid.
Hi Jake, i need some clarifications please. So you wouldn't recommend any core positions for those who are on the very top of the pyramid as there are only three satellite stocks?
If you want to retire off dividends, I would have a core of just ETFs and my favorites are SCHD/DGRO. Satellites can be both ETFs and individual stocks. Look at this as a guideline not a rule.
Hi Jake! Do you use any calculator to figure out your (let's say) monthly income from your portfolio? If Yes, please advise one. Like you enter your amount of money you have on you account and your etfs (for example, amount is $500k, schd - 40% of portfolio, dgro - 40%, dgrw - 20%) => click Ok to calculate monthly income.
Great video. Thank you. I learned a tremendous amount from this.
Glad it was helpful!
Can I book a 1 hr with you next year on your calendar? or wait for you to update when you will start? I am looking over the M! site now . Thanks.
Besides the time horizon, the other factor is planned expenses.
It makes sense to optimize for growth, as long as your expenses are covered.
@@adrian-nage 100%! In most cases it’s not what you make but what your expenses are. If you can avoid life style creep, you can reach FI much faster!
I mean you one should go with higher-growing (dgro, vig etc) category even if retiring soon, but already having his expenses covered.
62 years old looking to retire in 5 years; lump sum to invest in a traditional ira, do not plan on adding to holdings. Advise where to start on the pyramid?
What about trading 212 where u dont have a option for SCHD etc.. what alternatives should you use for the 10+year investment strategy
Very impressive. Thanks for sharing this!
Glad you enjoyed it!
I have questions. I plan on keeping attention a small portfolio. 8 to 12 holdings total. How many core stock or ETFs should I have before adding the satellites?
Keep it simple. I like Schd/dgro
Thank you but what about etfs equivalent to those in Europe? SCHF etc are not available here :(
Yeah :( there are some good alternatives available in Europe
Great Video as usual, in opinion, if you have 20+ years to invest, you should only invest in ETF. For average long term investor, it is very difficult to predict the long term future of any company.
more ETFs the better in my opinion
For income what about QYLD, RYLD, or XYLD as opposed to JEPI or JEPQ?
All up to you. I prefer jepq/jepi. Use this as a guideline not as a rule.
At 12:30 and on, you are using the numbers of years until retirement. What would I use if I have already retired ?
I’ve gotta stop watching so many different channels.
I’ve got the Core/Satellite approach In mind but I find I’m wanting 3 core and about 25 satellite positions haha..
Stop watching these dividend bro's for a start.
SCHD/DGRO/VOO/BRKB are my core holdings. Then I have satellite positions in many of the other stocks mentioned along with SCHG.
I love this model. I will adapt it makes sense I like the time horizon format
glad it was helpful!!
@@DividendGrowthInvesting absolutely!
Jake, I want to book time and talk to you because in my portfolio I usually don't pull the trigger. I did take a big pay cut but the money is still there
Yeah I do it a few times a week. Only do it if it will be valuable for you. I have nothing to sell you but my time.
but what about compounding interest? How in the world are you getting any CI when youre invested in this many stocks???
Hi great vid. Iam now 57 almost 58. I invest now for 3 years in dividend. What way is the best for me?
Max out you’re retirement accounts and find a balance of income and growth that meets your expenses
Wished I know about this in high school back in the day
You and me both!
So, my question is … does this pyramid work if you are just starting your core? I’m 10 years from retirement so I’m a little late to the game with limited funds. I’m open to suggestions/answers. Thanks all.
Yes you just want to make sure you’re investing in the right accounts for example in the US in a Roth or 401k. Then you want to find a balance of growth and yield that meets your expected expenses for the future.
Curious on your thoughts on Walmart. The long term growth coupled with a strong dividend attracts me.
Good defensive stock. Great satellite position.
Excellent video!. Do you have anything like this for people already in retirement or 70 and above?
The same would apply just the % would be different per investment.
Great rule of thumb and general primer…
Imo going into a more advanced level…
Some companies grow dividend by just having a lower and lower payout ratio. The year over year cashflow growth seems more important to me. Dividends ultimately get paid from free cash flow so free cashflow yield and free cash flow growth and the price you pay in yield for growth seem important to me, but that assumes that these things are predictive.
The durability of the business model and longevity of the company, or on the growth side the ability to disrupt and dominate a growing market with improving economics might be more important also.
Advanced isn’t necessarily superior. Improving return at the cost of complexity isn’t always a good trade off. If you have a method that works no need to overcomplicate it, but if you’re OCD/obsessive about learning everything and optimizing and increased complexity isn’t going to increase error rate then this info I’m saying may be useful.
Does BST ever make it here considering the tax treatment of distributions and also if you plan on never selling?
Nothing I’d personally consider due to the high fees but it’s something you could see as a satellite position.
Im confused...
So a "high yield" fund pays out a higher Rate, correct?
So what does a "high growth" fund do...?
❤❤
High yield generally means lower dividend growth and vice versa.
Would you put SCHG in a roth or taxable account? If you already had VFIAX in a 401k thru employer
I like growth in my Roth so I can rebalance tax free in retirement
@@DividendGrowthInvesting thank you for your response
@@DividendGrowthInvesting I ended up going with DGRO, DFVV in my taxable / SCHG in my roth.
Always really enjoy your videos.
Good general information. But it really sickening for me as an investor in GB using trading 212 platform i cant invest into SCHD and DGRO which are amongst my favourite ETFs
Yeah :( maybe there are other similar options out there
Love it, excited to watch.
Thanks for watching!!
Thank you, Jake! Great video as always. I am in retirement (65+). Are you saying I should not have DGRO and SCHD in my portfolio? (because I do) and should only have those positions at the bottom of the pyramid?
No I still would have Schd/dgro as you’re core but you add on top of those to get more income/ yield if you are close to retirement
@@DividendGrowthInvesting Thank you! How do you feel about SCHG vs DGRO? I did a comparison in Seeking Alpha and SCHG outperformed DGRO in Max Total Return but you are a lot better at analyzing ETFs.
@@DividendGrowthInvestinghey Jake. I own SCHD and have been thinking of adding DGRO but don’t they overlap a lot? I’ll appreciate your answer. Thanks.
Isnt there a big fund overlap with dgro and vym to add it as a satellite?
Question, I agree with you on DGRO, but why not DGRW? It seems like DGRW is the same thing except it pays monthly, which is good for ME personally when I have a life saving medication that I buy monthly. Is there some other difference between the two I don't know about which I should?
@@DrewBlue32 I see Dgrw as a great satellite position. The high expense ratio and inconsistent dividend growth makes it a satellite in my opinion. But you can see at as a core holding. Think of this as a guideline not a rule
Real good video!! 💯
Thanks for watching!
Very helpful video thank you
Glad it was helpful!
Hello Jake,
I was wondering if you could roll in a deeper dive soon into SCHY. I am seeing some dividend growth gains for it in seeking alpha. Right now I'm all SCHD and DGRO. Do you think SCHYs dividend growth will continue to be this big?
Yes I can. Thanks for watching!!
The real question I have: Where did you get a $300,000 cash influx in ~April of 2022?
Sold a rental property
Great video! Could you please do a video on SPYD? And compare it to SCHD. Everybody talking about SCHD and DGRO, but it seems that SPYD that has both better growth, and better dividend yield. Am I missing something?
Does it matter how much I put in in the first year? Can I just buy 1 share in year 1 and maybe in year 4 I invest 100k. Does the compund divided growth still working?
it does matter since it compound. let say, if you invest 100k on day 1 vs investing 100k/12=$8,333.33 for each month of the year, that 100k day 1would make more...that is if you investment is value stock instead of a trap dividend stock. you are looking at around 60% differences average wise.
I own DGRO & SCHD as core holdings but I am not sure what percentage of my portfolio should they be. Right now they are my 2 largest holdings but they make up 15% each with a goal of 20% each. Should it be bigger as a core holding or is that just right
Depends on you. I personally think you can’t have to little in your core with Schd/dgro. 60-80% of your total portfolio in my opinion
Do you use growth or S&P ETFs at all?
Um, which some cheap dividend stocks pay big money monthly?
What tool do you use the filter through thousands of business?
Seeking alpha
Why not have JEPQ higher? It pays over 10% dividend yield
It’s a great satellite position but the dividend growth is lower
Jake are you saying that all retirees should be sitting in the bottom rung JEPI, JEPQ etc?
Not exactly. Im saying if you want to live off your dividend portfolio, in addition to a core portfolio of SCHD/DGRO, you want to understand which investment vehicles will support your goals. JEPI/JEPQ are a great way to turbo charge your income if you need more income when you retire. They are great options to consider for satellite positions - based on your situation and goals.
@@DividendGrowthInvesting ok, makes sense. Thanks for clarifying!
Hi Jake, great video as always!!!
Just trying to find your opinion on this one. I’ve been actively investing since April and trying to find the best approach to select the timing of my investing following your core/satélite approach.
If I’m currently investing $200 monthly and I’m 28 years old trying to retire by my 60’s, would you invest equally based on your target distribution between your core and satellites or would you invest one month into your core and then balance it next month with the other $200 directed into your satellite and some core positions? Or which approach you think best suits in the timing of the investments with the core/satellite approach?
Hey!! Keep it simple and automate it regardless of what the market does. As you get closer to retirement treat it like a target date fund and slowly adjust the target weightings as you invest new money
Question about your sponsor, do they have a basic or advanced budgeting tool feature?
They have a basic free version you can try.
@@DividendGrowthInvesting thank you. Will test it, if worth it ill buy.
What a fine presentation
Good pyramid Jake. You know I still debate with myself. If I could go back 10 years which three ETFs would you put in your taxable, which three ETFs in your Roth? 🤔 So many combinations..
I’d go growth in my Roth and dividend growth in my taxable. Low fees and focus on the simple path
Was always curious why Southern and Duke have such low historical dividend growth rates 2 -3%...
Regulated utilities. I didn’t mentioned this in the video, but be very careful not to rush into buying DUK or SO when they trade at a high PE. You want to buy into these ideally when they have a ~4.5% forward yield. Right now SO has a 3% forward yield. Food for thought :)
@@DividendGrowthInvesting Wondering if Constellation Energy or Exelon are better buys long term than DUK and SO in the utility space because of the low dividend growth rates of the latter.
Hey thanks for the video, how do we go about getting advice from you? I just started investing age 31
I noticed it says $0 cash and all the buying power is margin. I currently have level 2 options account on webull and public. I think to get a margin account I need a minimum of $2k. I guess my question is, how can i get a margin account like this? Do I have to start with the $2k and build up the margin? Thanks for anyone that can help explain
Any Alternative for UK investors for DGRO and SCHD?
What portfolio software is that?
I put everything together in miro its a free tool that you can use.
I’m confused on why focus on dividend growth and not the actual dividend?
There are two reasons:
1) The dividend growth is the second derivative of the value of your portfolio. So if the dividend is the speed at which your portfolio grows, the dividend growth is the acceleration.
If your car goes 50/hour, it'll take you 4 hours to do 200, 10 hours to do 500 and 100 hours to do 5000.
However, if your car starts at 0, and accelerates by 2/hour, after 1 hour you will go 2/hour, and after 100 hours you'll go 200/hour.
The formula is now a * t²/2.
So after 1 hour we have done 2/hour * (1²)/ 2 = 1 unit of distance.
After 4 hours we have done 2/hour * (4²)/2 = 16 units of distance. Much less than the 200 we had in the first situation
After 10 hours, we have done 2/hour * (10²)/2 = 100 units of distance. Still much less than the 500 we had in the first situation
After 100 hours, we have done 2/hour * (100²)/2 = 10000 units of distance. Twice as much as in the first example.
If you focus on the actual dividend, like with say a PFLT, you will just get 10% a year. (I AM NOT SUGGESTING THAT YOU INVEST IN THIS STOCK IN ANY WAY, I JUST TOOK SOMETHING RANDOM THAT HAS HAD A STATIC VALUE AND DIVIDEND FOR A LONG TIME)
Your initial 1000$ input will grow by 100$ a year. After 30 years, you will have a 1000$ investment and earn 100$ a year.
If you reinvest your total wealth will look somewhat like this:
year 1: 1000 $ / 100$ a year in dividends
year 10: 2594 $ / 259$ a year in dividends
year 20: 6727 $ / 672$ a year in dividends
year 30: 17449 $ / 1745$ a year in dividends
year 40: 45259 $ / 4525$ a year in dividends
year 50: 117391 $ / 11739$ a year in dividends
This is quite good of course.
If you were to invest in a stock like VISA WITHOUT REINVESTING, it would look something like this: (again, not suggesting you invest in this stock)
year 1: 1000$ / 8$ a year in dividends
year 10: 35$ a year in dividends
year 20: 156$ a year in dividends
year 30: 687$ a year in dividends
year 40: 3029$ a year in dividends
year 50: 13365$ a year in dividends
But here comes the kicker: most dividend growth stocks have their stock price appreciate at a rate that is similar to their dividend growth. So that 1000$ you put into VISA would after 50 years be worth about 1.7 million, completely leaving the previous stock in the dust.
The big downside of course is that this requires a consistent growth and performance of a stock and its dividend over extremely long time spans.
I like the mixed approach the best my 457 has s&p 500 and blue chip growth funds pre tax, my roth and taxable has mostly SCHD and VYM, with a few jepi, VNQ. I will be adding vti and schg eventually for more net worth growth.
Yeah you have to go with the best option available. Thanks for watching!!
This was an epic video, and I appreciate your GROWTH approach. Far too many investors gun for dividend yield and it is crushing more wealthy opportunities than not.. If you are up for a face video, I would love to have you join me on Masters of the Market with these insights!
Hey Ari! Appreciate you taking the time to watch! If we could do it audio only, I’d be open to it. Hope you have a great week!
Love the videos. Quick question, how are you living off of ~$30k that you make in dividends? Other question is, if you don't mind, how does this dividend affect your taxes in the U.S.?
I talk about it in this video because I have more than one brokerage. ua-cam.com/video/ARRbFHi7Em8/v-deo.html
@@DividendGrowthInvesting Thank you! I will watch this :)
Awesome video ❤
Thanks 🤗