@@user-briannahui27 thanks Brianna! I’m officially out of nice things to say, you’re the best. I appreciate the EXTRA support you’ve given the channel.
Another great video, Jeff. Your videos help those of us who might get nervous when the market goes through its ups and downs. It's helpful to hear your advice to stay the course while sharing the amount of skin you have in the game. Walking the walk!
Thanks Nick! I appreciate the positive feedback. Thanks again for the extra level of support you show the channel by being a member as well. I'm a broken record about 'staying the course' because it really is the one thing we *need* to build wealth over many decades. We don't have to be geniuses to win the simple game. All about temperament.
Thank you, for lowering the music, I can stay your whole session. Thank you for sharing what you’re doing to build your wealth, as I am trying to do and you are encouraging.
Hey Sherry. Thank you for watching! Some of the music was still a bit loud, but I'm working on it (: I will soon do 100% of the video editing for my channel. I'm in the process of taking a course now. I pick everything out (b-roll, music, etc) and someone helps put it together for me. For some reason the volume has been... a lot of revisions lately (:
Happy to see all the updates, great breakdown Jeff! We've increased our income portfolio slowly but more so lately now up to 25% from 20% as compared to the past month as we gear up for retirement. Still have about 75% in SCHD, VOO, VGT, QQQM and will plan to reinvest the dividends back until the end of the year. Down & up the portfolio goes and those that had SCHD saw how it kept us above water until the market settled like a rogue wave in the ocean.
Thanks for watching and commenting. Love the system! I am excited for people to find out why SCHD isn't 'horrible' in the coming years. Value has gotten a bad rap lately. The tables will turn as they always do. I will continue to add SCHD and growth ETFs myself.
Nice video Jeff. One thing about SCHD pe ratio. It is actually 20.41. Schwab publishes the average of all the holdings. The weighted average is higher. I just learned this last week. If you go to wsj and get a quote they show the weighted pe ratio.
Good looking out Kyle. I'm getting a lot of data on PE ratios and I'm finding WSJ to be the outlier. I am going to look into this more. I'll calculate it in Excel with some Xlookups and sumproducts as well. I'll put that on my to do list for tomorrow, should just take a few minutes. Currently away from my 'office' (:
Thanks for the update Jeff - and congrats on ONLY being down 3-4%. I would have thought your PE ratio was lower given the SCHD holding, but the overall market remains a little pricey I suppose.
Thanks for watching and commenting Kent. Yeah, that SCHD definitely helps my PE ratio, but VGT and QQQM don't do me any favors (: Mesh it all together and I stay 'around VOO' on 'value'. You're right though, the entire market is *still* high these days compared to the historical PE ratio.
It is fun watching your detailed historical data of what your account has done and where it is heading. We have very similar portfolios aside from you being five years ahead of me. If we stay the course, we can all benefit from maintaining a simple portfolio strategy. Thanks for all the work you do. I wish it was possible for you to do a mid week short or informative general topic vid but I really appreciate how time consuming making these vids can be.
Hey Roy. Thanks for watching and for the kind words. I think I'll begin dropping two videos per week at some time in the future. Right now I'm getting in the flow of one per week and I want to put more into the little things on the channel. Spreadsheets, the giveaway, and things like that. When my kids go to school I will have waaaaaaay more time to get more done. At that point I see better 'little things' for the channel + 2 videos most weeks. I appreciate your extra level of support in these early / sporadic stages. Let's stay the course and beat this simple game long-term. Speaking of which, little update here (I recorded this one a while back before a vacation), I'm already back to 1.426M as of this weekend's update. I'm sure Mr. Market will continue to be a wild ride. I'm here for it!
I've loved the approach of living off dividends. Add in 45% SCHD, 10% DGRO, 25% JEPQ along with 10% VOO and 10% QQQM, and you'll average at least 4% dividend yield with a high dividend growth rate of around 6% which will beat inflation at 3%. No need for the 4% withdrawal rule, just withdraw dividends and your dividends every year will keep increasing without having to sell any shares, thus not subjecting yourself to any market risk!
Thanks for watching and commenting. I could not agree more, you absolutely nailed it. A lot of investors will explain that the 4% rule will end up with a higher portfolio value in 'most' scenarios. And they are dead... RIGHT. But... Your way of living on the dividends has a much *lower* fail rate. In other words, we won't get as rich as the 4% folks in 750,000 scenarios out of 1,000,000. BUT, they run out of money in 100,000 to the dividends maybe 1,000. I'm totally making up these specific numbers, but the *logic* is sound and time tested over many decades of scenarios (Monte Carlo stuff). Give me the consistent dividend yield and dividend growth rate combination and I say who cares about the current portfolio value (within reason).
Another great video! As always, doing my own net worth calculations while listening in. July was essentially flat but for the year I’m still beating VOO 🎉
You bet Cindy. Thank you for taking the time to watch it, *and* for showing extra support to the channel by being a member. I will be here for years to come regardless of what happens in the market. Staying the course and keeping it real are the top priority for me. Well, I lied, the *top* priority is helping as many people as possible reach financial freedom (:
Hi Jeff, great video as always! Would you consider doing a video that explains the Schedule D worksheet for line 16 on the 1040 tax form? As someone who enjoys dividend investing for retirement, I know it generates both qualified and ordinary dividends, which are taxed differently. A walkthrough of this would be really helpful!
Thank you for watching and for all the support you have provided the channel. That is a great idea. I should take my E*Trade year-end forms and break down the qualified vs non-qualified, and how it works into my tax liability. Not sure if that would be too in the weeds for a lot of viewers, but I love it.
@@JeffTeeples I think it's important to know the differences and prepare for yearly/quarterly taxes in a brokerage account. I have one account managed and got surprised with an unexpected tax bill. It was still good to make mula.
Hey Joseph. I'll give you a breakdown of all software and portals, which is probably overkill for your question. Thank you for watching the video and for the question. (I make a lot of these videos so I'm not sure specifically what I showed her haha). Investing platforms: E*Trade M1 Finance Work 401k Portal Aggregation: Seeking Alpha. I love this platform so much more than anything else, and I've tried a lot of them. I like it because it is a clean interface (same reason I prefer E*Trade to Fidelity, one clean screen of everything) & that it is where I do 99% of my research. I check my portfolio (way too often) and can click tickers for access to the news and key metrics I want to see at all times. I find myself rarely looking outside SA anymore. PS: This isn't a pitch, and I'm not sponsored. This has been the case far before my UA-cam channel. I do have an affiliate link to save new users money & to help support the channel (I get a kickback at no cost to the new user). Aggregation part 2: Excel spreadsheets. I've made some sheets over the years that have the components that I care about. Some software is too in the weeds, and most doesn't have the basics. Excel was my main 'skill' (if you can call it that) in my working career. I could more or less replicate any software (accounting and finance) in Excel and fully automate it. These sheets on the channel are very simple by design. I'm done with the world of branching rules tables (:
I'm slowly increasing my jepi and jepq investments, but use the dividends as cash to increase my other holdings. So by the time I retire I'll already have a decent monthly income without having to sell any shares to move to them.
I love that feeling Jeremy. It feels good to put dividends from JEPQ or JEPI into the long-term holdings. Feels like a bonus. Dare I say, free money (:
During market draw down , you should buy. This requires having a cash reserve. If you believe in the company , then buy more aggressively as the stock you’re looking at goes down Conversely , if you need to trim some holding because it’s becoming too much % in your portfolio , the do so in small amounts as the markets give up. Do this only if you’re becoming way too exposed to one stock or one sector ETF/ mutual fund
I agree with your logic. Thanks for watching and commenting. So many people have it backwards (panic sell in down market, jump on board in bull market). We need to do the opposite of what a typical 'human gut' calls for (:
@@JeffTeeples yeah … buying in the way down is a bit risky…. Catching a falling knife. It takes some patience to sell the higher priced positions as the stock rebounds, it might take a year If the stock is in a brokerage , some may sell some shares as the stock rebounds at a loss to harvest tax losses I managed to do this with CRWD, TTD, SE, WM, LMND, UPST I’m still waiting out for U and ZM
I've been keeping about $600,000 in Fidelity's premium money market fund (FZDXX) and it's been consistently paying monthly cash based on an annualized rate of ~5.2% for a while now. As you mentioned, the fed will lower rates soon which will cause the interest rates of CDs and money market funds to go down. I'm wondering where to reallocate cash to safely. I have about $150,000 in various CDs in a ladder from when the rates were high about a year or so ago. I have another ~$700,000 in index funds and ETFs. I'm trying to beef up the funds that pay dividends so when I leave my corporate job I can simply flip on the dividend switches to pay out instead of reinvest. I also own 4 rental condos in Boston and one on Cape Cod that are very lucrative. Great content.
Hey Pat. Sounds like you're in a great situation. My favorite 'safe' play for cash-flow is SCHD. Can the value drop a little here and there? Definitely. But it is value based (very low PE) and full of 100 companies with clean balance sheet metrics and dividend growth. My video next week goes into more detail about SCHD vs high yielding cash options. The dividends are qualified as well, which will be a tax advantage compared to interest from savings or CDs (assuming you have these assets in a taxable account. That is my two cents, but there are a ton of options. JEPQ is my favorite if you want more yield right out of the gate.
@@JeffTeeples I own SCHD and love it. I’m kind of scared of JEPQ. When you look at a graph of the performance (ie: over 5 years) it doesn’t look great. I use Fidelity and when I tried to order a small number of shares I got a pop up warning that Fidelity considered it a very risky security and to proceed with caution. That freaked me out a bit.
To be fair, JEPQ has out performed VOO since inception. It has only been around for just over 2 years. So 5 year graphs will naturally make it look terrible. Also, be sure to be viewing total returns. If you only look at the default graph (price returns) on most sites, JEPQ will look horrible. Total return since inception: JEPQ: 34.12% VOO: 33.92% Price return during same duration: JEPQ: 4.61% VOO: 29.19% With a yield of ~10%, it *really* messes up the number if ignored (: Plus, 5 year graphs will look terrible because it is 2.5 years of 0.00% before inception.
Hey Jeff great content. I was going to ask for any insight on portfolio ideas for custodial accounts. I got my kids on VOO, QQQM, SCHG and I recently opened an allocation on SMH. They have a lot of time for growth, any inputs will be greatly appreciated.
Thanks for watching Samo. I think those holdings are all great for a younger person that has many years ahead. In fact, I have my nephew in (about) 50% VOO, 25% QQQM, and 25% XLK (used this instead of VGT just to keep it separate from my stuff). I don't think they need the quality dividend ETFs like SCHD with so many years to dollar cost average in. There will be big drops, but as long as we don't panic sell it is a buying opportunity.
For sure. It is a bummer that traditional IRA and Roth IRAs don't benefit from qualified dividends. But SCHD gets qualified dividend tax rates & a step up cost basis when my kids take over some day. A taxable account is the only type of account that technically benefits from qualified dividends (vs ordinary).
Hey Jeff. We update the HODL Factory once per week. You are able to see a listing of the specific holdings out on the OneDrive (if you like Excel) or Google Sheets (if you like sheets) from my channel info page. It is the 9th spreadsheet. Updated weekly. I'll paste them here: (FREE) Excel Spreadsheets 1drv.ms/f/s!Anqr9n0OrsO-g40undVnMj-D9hWfaQ?e=nXlBW0 (FREE) Google Sheets drive.google.com/drive/folders/1qJHsMfsplDqWUIjvEk6BlkjjTRiY_Eg9?usp=s Channel members will know the day changes are made. I post all market moves the day they are made in channel member posts. But everyone can see the weekly snapshot.
Hi Jeff Cash holding as a percentage of a portfolio is a fool proof way to build up a "war chest" during good times, and auto buy the dip during bad. There are a some anti-cash youtube gurus who downplay the importance of cash as a holding. I wonder if a video about the importance of holding cash in an investment portfolio with difference scenarios would be helpful
Hey Chris. I could not agree more. I've been trying to think about a way to explain the pros and cons of 'cash' and 'timing the market'. The auto-dip buying (comparative to the portfolio mix) is so powerful, but the logic doesn't resonate with everyone. It seems to good to be true. People want to put in more manual effort to timing it just right. I'll release something about cash in the near future.
Say you’re holding VMFXX and JEPQ as a partial alternative to a HYSA (money you want semi-liquid but won’t need for the next 3-6 months). Add to that, assume you don’t need the monthly dividends for living expenses. Would you advise enrolling JEPQ in a drip or just take the cash and do something else with it? I had it in a DRIP and was actually pleased when it rebought at a cheaper price earlier this month. But it’s a fairly new position for me. I know you’re rocking it for the cashflow specifically but for me new shares = cash + potential appreciation.
Hey David. Thanks for watching and for the thoughtful comment. I think JEPQ is great for both (DRIP on or off). It's great on because it keeps snowballing higher dividends. When the market crashes, it's even better! The higher volatility helps the premium income & you buy more shares per dollar reinvested if the value drops. It's a win / win. I personally turn drip off because I love the idea of 'DRIPing' the JEPQ dividends into things like SCHD. I feel like it gives me the best of both worlds (more cash *now* with JEPQ flowing and more cash 'growth' later with SCHD building). Short answer is that I think JEPQ is great to reinvest the dividends into itself *or* to your other positions. I love the consistent monthly income from it.
GREAT video Jeff... Love your portfolio summary and disclosure as well as your honesty. Love hearing your logic and thoughts as well behind your various moves. Presuming you hold the JEPQ in a taxable/Brokerage account - and will juts have to take the hit on taxes...??? I have JEOQ set up in my IRA's and have not done that move into my taxable yet. I do believe I will start doing so in the near future to bolster my Taxable acct to get more dividends flowing. Have many holdings with low dividend payout but fast growers..... Again,l thank you for the video - appreciate all of your efforts each week. Please be well and let's get you more subs... 10k + now....
Hey Lance. Thanks for watching and for your extra level of support as always. JEPQ is much better in a tax protected account (because most of the dividends are non-qualified). In my situation, the extra income is needed and the taxes are what they are (as if I pulled it out of the IRA and it added to my taxable income). In a perfect world, I would have SCHD in the taxable and JEPQ (or more likely, QQQM) in the IRAs next to VGT. This is opposite of how many others do it, but it would reduce my taxable income (assuming I needed the SCHD cash-flow to live on, it is basically 'free money' at that point when wife and I make less than $123k per year in retirement, 0% taxes) *and* not or, I could pull some money to fill up the 12% tax bracket from the IRA (pulling more out to stay in proper bracket). If VGT + QQQM were in taxable, I could live on those qualified dividends, but it is less of a yield and therefore less 'free money'. I would have to pull SCHD dividends out of IRA, which converts them to 'ordinary income'. Less money in my pocket for the same 12% bracket fill up. The qualified dividends are forever lost when coming from an IRA (they 'convert the gains' to 'ordinary income' no matter what).
@@JeffTeeples Thank you.... Trying to beef up the taxable with higher yielding Qualified holdings.... I do have SCHD & DGRO in there as well as some of those growers not showers I spoke about (V, COST, NVDA, LLY, + some old guard like PG, PEP, JNJ, CVX, ABBV, HSY) as well as my Tech ETF XLK. I just reinvest and do not collect dividends - yet - as I have my pensions for everyday living - but was thinking to possible do so for trips etc.... Investing is truly a science and numbers game... Just trying to get all the rules and strategies digested the best I know how. Thank you again for all you do for us....
haha, been there before. The beauty about Roth accounts is that you can sell everything, and buy the ones you want without any tax implications. Feel free to clean it up any day the market is open (: With taxable accounts it can be a little trickier from a tax perspective.
Hi Jeff, For someone in his early 40's The logic of investing DCA into JEPQ for 10-15 years and turn DRIP off in order for during that 10-15 years period reinvest that dividend into the SCHD for example is that after 15 years if I turn DRIP back on I can never run out of money from JEPQ? Since I never sell it? I hope my question make sense but mainly I am trying to understand if for JEPQ obviously I don't use the 4% rule and don't sell it can I run out of money in that investment once I stop investing into it. Thanks mentor
Hey Idan. I think JEPQ with dividends reinvested in SCHD or JEPQ is a great way to build shares and cash-flow long-term. However, for someone that doesn't need the cash now, I think QQQM is better than JEPQ for ultimate cash flow long-term if that makes sense. After 15 years, QQQM will very likely have a higher total return than JEPQ (how the funds work will normally prove this out, JEPQ sacrifices growth for cash-flow, and has a high expense ratio). If I didn't *need* cash now to pay the bills, I would use QQQM over JEPQ. I happen to have both, but I hold on to, and add more JEPQ to help pay our actual bills now (I lost 100% of my income, and I was well over half the household income). Mortgage and two kids aren't cheap. I do think JEPQ + SCHD will work for all durations, but VOO or growth ETFs are 'better' for people with 15 or more years to invest (time to ride out the waves and dollar cost average in). Really, just picking a system and sticking to it in the good and bad times is the way to win. There are countless 'right ways' to do it. Going with our guts in certain markets is *never* the right way. Set up a system that works for you and stay the course.
Thanks Jay. I appreciate you taking the time to watch the video and for dropping a comment. My portfolio has crossed $1.425M again. What a crazy ride. I do my best not to jump overboard regardless of the waves.
I have him in a Roth IRA because he works and has earned income. This is better than a UTMA which is a taxable account (to my knowledge). Similar concept. He works, gives me money, and I invest it for him in a Roth that will be tax free forever for him. He’ll take over at 18 years old (he’s 16). My other two have already taken over their Roth IRAs (18 and 20).
Ahh is this the Roth IRA for kids? I have a soon to be two years old and want to invest for him. Since he doesn’t have earned income, would the UTMA be the best route?
It's tough to say if there is a universal 'best' way to do it. The UTMA can help save you tax money when you invest for your kid. Just know that when he/she turns 18 or 21 (depending on state) the money is 100% theirs and they can do what they want (sometimes a bit scary depending on the kid). A 529 may be better if you are in a state that allows it to be a tax deductible contribution. Although, then the argument could be if they go to school or have qualified events to use the 529 money. The UTMA is more universal to be used towards anything in life. Living in WA I have zero desire to start a 529 for either of my children. It doesn't make sense here (IMO). I will maximize my current investing system, and get them started on a Roth IRA as soon as possible (if they work before 18). I'll utilize gifts and step up cost basis to get them the money tax free some day. A lot can change between now and then (they are 2 and 4), but that is how I'm approaching it at the moment. Don't want any weird risks (them not going to school and penalty on 529, or them blowing a UTMA when they are 18 years old and dumb, etc).
Really enjoying this Sunday morning videos thanks for sharing, i have a pretty decent sum in vanguard mm and playing with the thought to split it in 50/50 jepq/jepi to gain more div 😊 but im not sure if i label this sum as emergency or investing Lol thanks again for your videos im learning a lot😊 😊😊😊
I know I spoke to you about this before, but it would seem to me all you will ever buy in bull market is SCHD and buy VOO and Growth etf during downturns. Is there a good way to see if juts DCA 33.3% (repeating of course) would be better worse or same.
Rebalance testing will not work before the market reverts to the mean. Having the buy the same no matter what strategy has slightly better results than target allocations with SCHD and VGT. But this makes sense because we are in a historic 10+ year bull run right now without the reversion. In other words, even buys would be 'extremely heavy' in VGT right now (without target allocation buying or rebalancing). As soon as the mean reverts, the target allocation portfolio would be significantly better. This is because it is mathematically impossible to not buy the comparative dip with target allocations. Again, assuming the investments are good in general (there are such thing as bad stocks and ETFs at all times in all markets). This has been tested throughout 100+ year history, but, we can't look at stuff that has only existed the past decade, yet. It is factually better to use target allocations (assuming a reasonably balanced strategy in general) over many years / decades. But 'right now', it hasn't 'worked' as well in the past decade and change. We have our long-term blinders on lately. Another way to look at it is that it is impossible to not have more of both holdings long-term after multiple swings (because you are only buying both when they are 'comparatively lower'. Actually, that is a good video idea. I should make a spreadsheet to show that (with ETF A and ETF B).
very thorough analysis as always! Jeff - do you have a video (I searched but did not find one) about the best placement of specific ETFs (market, growth, dividend) into regular brokerage, Roth and 401(k). I think it is a very confusing topic and a lot of people will appreciate your insight. I assume you live in WA with no state tax. would it change the placement (eg moving SCHD to IRA or Roth) if you lived in a state with high state tax? I live in Maryland and the state takes 9.3% so real tax on qualified dividend is 24% or so:(
Hey Mervyn. Thanks for the positive feedback. That is a great video idea! I've touched on taxable vs Roth vs traditional in a few videos, but I don't think I've ever made it *thee* video topic. I do live in WA State, so I would need to do a little refresher before getting into state taxes. I do have a master's degree in accounting and a lot of experience in finance, but I am not a 'tax expert' and have always lived in a no income tax state. I know enough to be dangerous (:
Loved your video... easy casual friendly voice.... non preachy non pretentious very genuine and caring smart ...... instant subscribe... Quick question is it wise to buy in on QQQM I know it's 0.05 points cheaper than QQQ but then don't you think you might have better premiums on QQQ when you sell options on them in retirement ?
Thank you for the kind words. I appreciate you taking the time to watch the video and for leaving a comment. I think QQQM is better for buy & hold investors. QQQ is preferred if you will be trading options for extra income (because of the volume advantage). Really they are both great. If you have a lot of QQQ in a taxable account, I wouldn't sell it to buy QQQM. I would put new purchases into QQQM, and then prioritize selling QQQ first when/if you need to update to target allocations with a rebalance. A 5 basis point difference isn't a reason to make unnecessary moves.
Hello Jeff, and thank you for your endless efforts to share the knowledge! What do you think about QQQI and do you think it's reasonable to have both: QQQI and JEPQ in one portfolio? Is this only about deversification, or is there something else? Thank you!
Thanks for taking the time to watch the video and for the question. QQQI and JEPQ are very similar in that they both use the Nasdaq-100 for the underlying holdings and write call options to produce dividends. I prefer JEPQ more because of the lower expense ratio 35 vs 68 basis points. They are very similar in nature to where they don't necessarily diversify your portfolio if you have both. It would be like having VOO and VTI. It doesn't hurt anything to to have both, but it doesn't necessarily do anything different than either or.
Great video Jeff as always!! Thank you so much! I have a question about QQQM. What’s the difference between QQQM and QQQ other than the price is different and the fees are different? Thank you so much! I remember you buy QQQM instead of QQQ.
Thanks for watching and for the kind words Jane. I appreciate it. QQQM and QQQ have the same holdings (at least they follow the same exact index). You 'basically' get the exact same product at a lower cost with QQQM instead of QQQ. QQQ is older and QQQM was made to be competitive with other major growth ETFs that have a lower expense ratio, like SCHG.
@@JeffTeeples Thank you so much Jeff! Really appreciate your explanations. That's great to know! You know so much. I know I can definitely learn a lot from you :)
Hey Blaine. I have been keeping an eye on SPYI. It is still quite new, and I haven't officially added it to my ETF tracker spreadsheet, but I'm curious to see how it does in the future. It does violate my hard requirement of staying below 50 basis points on the expense ratio.
Love this kind of portfolio Jeff. Thanks so much for sharing. I might have missed it. Which account do you hold ibit and jepq? Is there a tax drag on it ? Huge numbers fan. Love seeing the breakdowns on allocation like this.
Thanks for taking the time to watch the video and for leaving positive feedback. I hold IBIT and JEPQ in my taxable brokerage account. With JEPQ, it is not ideal in a perfect world. However, I need the cash-flow now, and I'm under 59.5 years old. It is the lessor of two evils from a tax perspective. If I didn't need the cash now, I could avoid some ordinary income by sticking it in a tax protected account. It counts as ordinary income, my wife and I consider it an employee that works for us to pay us a bonus each month (: IBIT is a buy and hold. I will only sell long-term capital gains or losses as I keep it between 2% and 3% of my portfolio. It's ideal there as it pays zero dividends and I have full control of taxes.
@@JeffTeeples makes perfect sense. I like both of those funds quite a bit. Looking to stashing them in the Sep Ira. To avoid some of the taxes for the time being. Down the line may convert some Voo into these. Great motivation sharing and seeing a portfolio of this size Jeff!
That's the best thing about being over 59.5 - maybe the only thing! 😄 I've got JEPQ and the majority of my dividend payers in my Roth. I'm still dripping the dividends thru Q3, maybe Q4.
Haha Charlie, no doubt! Sometimes I'll tell my dad 'I wish I was 60 so I could put my JEPQ into my tax protected accounts' and he'll say 'no you don't'. (:
Hey Ivan. I appreciate you watching the videos, dropping comments, and for going above and beyond as a channel member. It helps and means a lot. Your shoutout was on 'The Power of Compound Interest' video. I appreciate you! I need to find a way to have a ticker at the bottom of my videos scroll through this awesome member community.
I don't move money from VGT to SCHD or vise versa (in the literal sense). But I do is put 'new money' into SCHD if my growth ETFs are higher, and I put it into the growth ETFs if SCHD is higher. It allows me to always buy the relative dip in my portfolio by default with new contributions. I like the 50/50 balance (and then VOO is always a big chunk, but it is a hybrid of growth and value in and of itself).
Thanks for watching Alex. I'm not a huge fan of SVOL because of the crazy high 1.16% expense ratio and the way that it produces income. I want to see if it is sustainable over a long period of time. However, it has been *incredible* since inception. So far, the result have spoken for themselves. I'm not a hater on this one, just a bit skeptical.
Do you think is worth it having O realty income for long term dividends. I do own VGT. SCHD, VTI, QQQM. O is my only single stock 233 shares. Sometimes I feel like selling it since I’m up and add it to my SCHD position what you think.
That's a great question Oscar. O is my favorite (basically) 'REIT' out there. It is what I would own to get exposure to real estate. I prefer SCHD, but I think having both can be a great idea too. O comes with more yield, but less dividend growth rate. Won't hurt your portfolio unless it is a very large position. That's my two cents on it.
@@JeffTeeples your absolutely right that’s one of the reasons why I kept O because is my favorite reit hands down. I guys I’ll keep it for long term since I do love the dividend and continues to add a small portion in it 100 dollars weekly. Thank you! For your respond love your videos by the way I love your long term portfolio.
What is your thoughts on buffered etf like innovators PJUN. The Innovator U.S. Equity Power Buffer ETF™ seeks to track the return of the SPDR S&P 500 ETF Trust (SPY), up to a predetermined cap, while buffering investors against the first 15% of losses over the outcome period. The ETF caps the gains 13.38 with expenses ratio of .79%. What are in your opinion the pros and cons?
Hi Felice. I don't like any ETF with an expense ratio greater than 50 basis points. It is the number one predictor of future results (other things equal). And capped ups and downs don't work out well over time. For example, and granted, it has been a bull of a run, but still, here is the 5 year total returns of PJUN vs VOO (what it is basing caps on): VOO: 108.28% PJUN: 38.14% I have never seen a capped fund outperform a benchmark over 30+ years. I don't think it is possible. It's like me preferring SCHD to BND for passive income. It will 'always' do better 'long-term' regardless of the short term implications. I'm a big advocate of zooming out as much as possible when viewing data.
Glad to see you have SWPPX! That's my favorite thing about Schwab, awesome product. Now if Schwab could just get on board with the M1 Finance fractional shares "Pie" instead of Schwab Slices... To use your expression, I should just "rip off the bandaid" and open a M1 acct. Do you have an affiliate link for that?
Hey Chris. It's funny, my wife and I were chatting this weekend (well I was talking and she was humoring me by pretending to care lol) about how I wish E*Trade had the M1 Pies. I do have an affiliate link for it. It hasn't gotten me (or more importantly, the person using it) and bonuses for some reason. But if you want to start I would appreciate you giving it a try. Thanks for asking! My M1 link: m1.finance/qKHE6cu7jKp9 Schwab has some great funds that I like. Of course, my 3rd child, SCHD comes to mind (: Thanks for watching and for your extra level of support for the channel.
@@JeffTeeples So with M1 it looks like I need a minimum $10K balance to avoid monthly fees. It's going to take me a while to shuffle the coconut shells to make that happen. But, when I do use the link I'll let you know just so we both can see if M1 gives either of us a little extra love.
Awesome Chris. Much appreciated. They added that new fee earlier this year. I'm not a huge fan of it, but I still think it is worth using all things considered.
Thank you for watching and commenting. I don't think yours is bad at all. We all have different goals and risk tolerances, and I think you will cash flow just fine with your mix moving into the future.
Hey Oldrin. Oh man, we put a major emphasis on our 401ks early on. It was the best move we ever made! Not only is it free money with the company match (always start with at least enough to get the full match), but it also was tax efficient money directly into the S&P 500 (beyond the match). I realized that besides paying the bills and getting out of our massive debt, every extra penny should go into our 401ks. The tax savings added up (that whole compound thing) like crazy over the years compared to using taxable accounts. Now, it's nice to have access to the money, but I cared way more about growing it at the time. Started taxable investments a few years in to start building that too. We weren't able to max our 401ks for a looooong time. We did finally get to the point (like now) where maxing 401ks was 'a bill' that we slowly worked to with lifestyle changes (more accurately, NOT life styling up with little raises). For context, we made $94k combined and had $90k debt when we started at Boeing (2010). Now we did work up with hard work, but looking at my portfolio now one may assume 'who cares about the little things it's over 1mm'. But the little things were *everything*. My 2013 Honda Civic is still running great, which replaced my 99 Honda Civic. Nothing is easy unless you make a TON of money (like some of my friends, lol). I'm as 'normal' as it gets. I want to help people that are a lot smarter than me get ahead for good. Financial freedom (: Quick edit: Our 401k had (basically) zero fees and a great S&P 500 option at Boeing. If the 401k options are bad, it may make sense to look to a Roth IRA or traditional IRA first before going beyond the company match amount.
Thanks for watching and for leaving a comment. It's a grind with a lot of 'less fun' decisions involved (for delayed gratification), but we are slowly getting there. 42 years old and 2 Honda Civics to my name (lifetime) help feather more money in to the portfolio. Tons of other little things as well. That is why the passion for this stuff burns for me, *anyone* can do this. Truly.
Thanks for watching and for the positive feedback. I appreciate it. Been working on making the music quieter in the background. I think this one might have been a little too loud. Zero music is a hard no for me.
You beat me! I randomly woke up today at 5:57 am and I was tempted to get on to be 'first' on the comments for this video. I used to do that on multiple forums / articles I followed. I was too lazy today and you win!
I’m trying to keep that mindset too, especially when I see crypto like Bitcoin taking hits. Anyone else think that diversifying into something like a crypto IRA might be the move? I’ve been using My Digital Money for that, and it’s been pretty smooth sailing so far. What do you all think about that strategy?
I like crypto as a wild card for my portfolio. But I don't believe it in long-term like I do quality companies that produce products and services. I think staying under 5% is wise.
Just friendly ribbing here... #dogearmy -> #dogedeserter :-) But I can't really throw shade. While I never bought Doge, I did buy Cardano and keep waiting for that rocket to the moon. Joking aside, since I'm about 6 months away from retirement, I'm also beefing up JEPQ vs working longer. Congrats on obliterating your YTD dividend progress!!
Haha, love it Eric. Got a nice chuckle this morning from this one. And you're right, I am officially a Doge deserter that I have jokingly picked on for years! (: Very nice on the JEPQ. I know people are mixed on it, but I think it is great cash-flow with a well established underlying index. QQQM is better for the young bucks with 20+ years to invest before retirement, but JEPQ is a solid cash-flower for right now. SCHD is still my long-term horse for dividend growth. I'm going with the dividends reinvested from JEPQ to SCHD & friends strategy.
Thanks!
@@user-briannahui27 thanks Brianna! I’m officially out of nice things to say, you’re the best. I appreciate the EXTRA support you’ve given the channel.
Another great video, Jeff. Your videos help those of us who might get nervous when the market goes through its ups and downs. It's helpful to hear your advice to stay the course while sharing the amount of skin you have in the game. Walking the walk!
Thanks Nick! I appreciate the positive feedback. Thanks again for the extra level of support you show the channel by being a member as well. I'm a broken record about 'staying the course' because it really is the one thing we *need* to build wealth over many decades. We don't have to be geniuses to win the simple game. All about temperament.
Thank you, for lowering the music, I can stay your whole session. Thank you for sharing what you’re doing to build your wealth, as I am trying to do and you are encouraging.
Hey Sherry. Thank you for watching! Some of the music was still a bit loud, but I'm working on it (: I will soon do 100% of the video editing for my channel. I'm in the process of taking a course now. I pick everything out (b-roll, music, etc) and someone helps put it together for me. For some reason the volume has been... a lot of revisions lately (:
Happy to see all the updates, great breakdown Jeff! We've increased our income portfolio slowly but more so lately now up to 25% from 20% as compared to the past month as we gear up for retirement. Still have about 75% in SCHD, VOO, VGT, QQQM and will plan to reinvest the dividends back until the end of the year. Down & up the portfolio goes and those that had SCHD saw how it kept us above water until the market settled like a rogue wave in the ocean.
Thanks for watching and commenting. Love the system! I am excited for people to find out why SCHD isn't 'horrible' in the coming years. Value has gotten a bad rap lately. The tables will turn as they always do. I will continue to add SCHD and growth ETFs myself.
Nice video Jeff. One thing about SCHD pe ratio. It is actually 20.41. Schwab publishes the average of all the holdings. The weighted average is higher. I just learned this last week. If you go to wsj and get a quote they show the weighted pe ratio.
Good looking out Kyle. I'm getting a lot of data on PE ratios and I'm finding WSJ to be the outlier. I am going to look into this more.
I'll calculate it in Excel with some Xlookups and sumproducts as well. I'll put that on my to do list for tomorrow, should just take a few minutes. Currently away from my 'office' (:
Thanks for the update Jeff - and congrats on ONLY being down 3-4%. I would have thought your PE ratio was lower given the SCHD holding, but the overall market remains a little pricey I suppose.
Thanks for watching and commenting Kent. Yeah, that SCHD definitely helps my PE ratio, but VGT and QQQM don't do me any favors (: Mesh it all together and I stay 'around VOO' on 'value'.
You're right though, the entire market is *still* high these days compared to the historical PE ratio.
It is fun watching your detailed historical data of what your account has done and where it is heading. We have very similar portfolios aside from you being five years ahead of me. If we stay the course, we can all benefit from maintaining a simple portfolio strategy. Thanks for all the work you do. I wish it was possible for you to do a mid week short or informative general topic vid but I really appreciate how time consuming making these vids can be.
Hey Roy. Thanks for watching and for the kind words. I think I'll begin dropping two videos per week at some time in the future. Right now I'm getting in the flow of one per week and I want to put more into the little things on the channel. Spreadsheets, the giveaway, and things like that.
When my kids go to school I will have waaaaaaay more time to get more done. At that point I see better 'little things' for the channel + 2 videos most weeks.
I appreciate your extra level of support in these early / sporadic stages. Let's stay the course and beat this simple game long-term. Speaking of which, little update here (I recorded this one a while back before a vacation), I'm already back to 1.426M as of this weekend's update. I'm sure Mr. Market will continue to be a wild ride. I'm here for it!
keep pumping out those financial informational videos Jeff!!!!
Will do Kevin. Thanks for your consistent support for the channel!
I've loved the approach of living off dividends. Add in 45% SCHD, 10% DGRO, 25% JEPQ along with 10% VOO and 10% QQQM, and you'll average at least 4% dividend yield with a high dividend growth rate of around 6% which will beat inflation at 3%. No need for the 4% withdrawal rule, just withdraw dividends and your dividends every year will keep increasing without having to sell any shares, thus not subjecting yourself to any market risk!
Thanks for watching and commenting. I could not agree more, you absolutely nailed it.
A lot of investors will explain that the 4% rule will end up with a higher portfolio value in 'most' scenarios. And they are dead... RIGHT.
But...
Your way of living on the dividends has a much *lower* fail rate. In other words, we won't get as rich as the 4% folks in 750,000 scenarios out of 1,000,000. BUT, they run out of money in 100,000 to the dividends maybe 1,000.
I'm totally making up these specific numbers, but the *logic* is sound and time tested over many decades of scenarios (Monte Carlo stuff). Give me the consistent dividend yield and dividend growth rate combination and I say who cares about the current portfolio value (within reason).
Another great video! As always, doing my own net worth calculations while listening in. July was essentially flat but for the year I’m still beating VOO 🎉
Very nice Anthony. I'm jealous! But I'm hoping to catch up to VOO by the time the year is over. Gotta keep the streak alive.
This is great Jeff! Thanks for sharing that thorough view of your portfolio.
Thanks for taking the time to watch and comment Craig. Much appreciated.
Thank you for the video and the transparency.
You bet Cindy. Thank you for taking the time to watch it, *and* for showing extra support to the channel by being a member. I will be here for years to come regardless of what happens in the market. Staying the course and keeping it real are the top priority for me. Well, I lied, the *top* priority is helping as many people as possible reach financial freedom (:
Hi Jeff, great video as always! Would you consider doing a video that explains the Schedule D worksheet for line 16 on the 1040 tax form? As someone who enjoys dividend investing for retirement, I know it generates both qualified and ordinary dividends, which are taxed differently. A walkthrough of this would be really helpful!
Thank you for watching and for all the support you have provided the channel. That is a great idea. I should take my E*Trade year-end forms and break down the qualified vs non-qualified, and how it works into my tax liability. Not sure if that would be too in the weeds for a lot of viewers, but I love it.
@@JeffTeeples I think it's important to know the differences and prepare for yearly/quarterly taxes in a brokerage account. I have one account managed and got surprised with an unexpected tax bill. It was still good to make mula.
What SW portal are you using to showcase this aggregrated data?
Hey Joseph. I'll give you a breakdown of all software and portals, which is probably overkill for your question. Thank you for watching the video and for the question. (I make a lot of these videos so I'm not sure specifically what I showed her haha).
Investing platforms:
E*Trade
M1 Finance
Work 401k Portal
Aggregation:
Seeking Alpha. I love this platform so much more than anything else, and I've tried a lot of them. I like it because it is a clean interface (same reason I prefer E*Trade to Fidelity, one clean screen of everything) & that it is where I do 99% of my research. I check my portfolio (way too often) and can click tickers for access to the news and key metrics I want to see at all times. I find myself rarely looking outside SA anymore.
PS: This isn't a pitch, and I'm not sponsored. This has been the case far before my UA-cam channel. I do have an affiliate link to save new users money & to help support the channel (I get a kickback at no cost to the new user).
Aggregation part 2:
Excel spreadsheets. I've made some sheets over the years that have the components that I care about. Some software is too in the weeds, and most doesn't have the basics. Excel was my main 'skill' (if you can call it that) in my working career. I could more or less replicate any software (accounting and finance) in Excel and fully automate it. These sheets on the channel are very simple by design. I'm done with the world of branching rules tables (:
I'm slowly increasing my jepi and jepq investments, but use the dividends as cash to increase my other holdings. So by the time I retire I'll already have a decent monthly income without having to sell any shares to move to them.
I love that feeling Jeremy. It feels good to put dividends from JEPQ or JEPI into the long-term holdings. Feels like a bonus. Dare I say, free money (:
During market draw down , you should buy. This requires having a cash reserve. If you believe in the company , then buy more aggressively as the stock you’re looking at goes down
Conversely , if you need to trim some holding because it’s becoming too much % in your portfolio , the do so in small amounts as the markets give up. Do this only if you’re becoming way too exposed to one stock or one sector ETF/ mutual fund
I agree with your logic. Thanks for watching and commenting. So many people have it backwards (panic sell in down market, jump on board in bull market). We need to do the opposite of what a typical 'human gut' calls for (:
@@JeffTeeples yeah … buying in the way down is a bit risky…. Catching a falling knife. It takes some patience to sell the higher priced positions as the stock rebounds, it might take a year
If the stock is in a brokerage , some may sell some shares as the stock rebounds at a loss to harvest tax losses
I managed to do this with CRWD, TTD, SE, WM, LMND, UPST
I’m still waiting out for U and ZM
I use target allocation to automate my 'dip-buying' process over time. Nobody knows what the crazy market will do day to day (:
I've been keeping about $600,000 in Fidelity's premium money market fund (FZDXX) and it's been consistently paying monthly cash based on an annualized rate of ~5.2% for a while now. As you mentioned, the fed will lower rates soon which will cause the interest rates of CDs and money market funds to go down. I'm wondering where to reallocate cash to safely. I have about $150,000 in various CDs in a ladder from when the rates were high about a year or so ago. I have another ~$700,000 in index funds and ETFs. I'm trying to beef up the funds that pay dividends so when I leave my corporate job I can simply flip on the dividend switches to pay out instead of reinvest. I also own 4 rental condos in Boston and one on Cape Cod that are very lucrative. Great content.
Hey Pat. Sounds like you're in a great situation. My favorite 'safe' play for cash-flow is SCHD. Can the value drop a little here and there? Definitely. But it is value based (very low PE) and full of 100 companies with clean balance sheet metrics and dividend growth. My video next week goes into more detail about SCHD vs high yielding cash options. The dividends are qualified as well, which will be a tax advantage compared to interest from savings or CDs (assuming you have these assets in a taxable account. That is my two cents, but there are a ton of options. JEPQ is my favorite if you want more yield right out of the gate.
@@JeffTeeples I own SCHD and love it. I’m kind of scared of JEPQ. When you look at a graph of the performance (ie: over 5 years) it doesn’t look great. I use Fidelity and when I tried to order a small number of shares I got a pop up warning that Fidelity considered it a very risky security and to proceed with caution. That freaked me out a bit.
To be fair, JEPQ has out performed VOO since inception. It has only been around for just over 2 years. So 5 year graphs will naturally make it look terrible.
Also, be sure to be viewing total returns. If you only look at the default graph (price returns) on most sites, JEPQ will look horrible.
Total return since inception:
JEPQ: 34.12%
VOO: 33.92%
Price return during same duration:
JEPQ: 4.61%
VOO: 29.19%
With a yield of ~10%, it *really* messes up the number if ignored (: Plus, 5 year graphs will look terrible because it is 2.5 years of 0.00% before inception.
@@JeffTeeples thanks I’ll have to research it further tomorrow. My latest new purchase is FDVV. I’ve been slowly dollar cost averaging into that one.
That one has been incredible! It is featured in my video next week about the best dividend stocks mid-way through 2024.
Hey Jeff great content. I was going to ask for any insight on portfolio ideas for custodial accounts. I got my kids on VOO, QQQM, SCHG and I recently opened an allocation on SMH. They have a lot of time for growth, any inputs will be greatly appreciated.
Thanks for watching Samo. I think those holdings are all great for a younger person that has many years ahead. In fact, I have my nephew in (about) 50% VOO, 25% QQQM, and 25% XLK (used this instead of VGT just to keep it separate from my stuff). I don't think they need the quality dividend ETFs like SCHD with so many years to dollar cost average in. There will be big drops, but as long as we don't panic sell it is a buying opportunity.
Do you think SCHD in a taxable account makes sense given its tax implications?
For sure. It is a bummer that traditional IRA and Roth IRAs don't benefit from qualified dividends. But SCHD gets qualified dividend tax rates & a step up cost basis when my kids take over some day.
A taxable account is the only type of account that technically benefits from qualified dividends (vs ordinary).
Hey Jeff, how often do you update the hodl portfolio and is there a way we can see when you change it in real time?
Hey Jeff. We update the HODL Factory once per week. You are able to see a listing of the specific holdings out on the OneDrive (if you like Excel) or Google Sheets (if you like sheets) from my channel info page. It is the 9th spreadsheet. Updated weekly. I'll paste them here:
(FREE) Excel Spreadsheets
1drv.ms/f/s!Anqr9n0OrsO-g40undVnMj-D9hWfaQ?e=nXlBW0
(FREE) Google Sheets
drive.google.com/drive/folders/1qJHsMfsplDqWUIjvEk6BlkjjTRiY_Eg9?usp=s
Channel members will know the day changes are made. I post all market moves the day they are made in channel member posts. But everyone can see the weekly snapshot.
Hi Jeff
Cash holding as a percentage of a portfolio is a fool proof way to build up a "war chest" during good times, and auto buy the dip during bad. There are a some anti-cash youtube gurus who downplay the importance of cash as a holding.
I wonder if a video about the importance of holding cash in an investment portfolio with difference scenarios would be helpful
Hey Chris. I could not agree more. I've been trying to think about a way to explain the pros and cons of 'cash' and 'timing the market'. The auto-dip buying (comparative to the portfolio mix) is so powerful, but the logic doesn't resonate with everyone. It seems to good to be true. People want to put in more manual effort to timing it just right.
I'll release something about cash in the near future.
Say you’re holding VMFXX and JEPQ as a partial alternative to a HYSA (money you want semi-liquid but won’t need for the next 3-6 months). Add to that, assume you don’t need the monthly dividends for living expenses.
Would you advise enrolling JEPQ in a drip or just take the cash and do something else with it? I had it in a DRIP and was actually pleased when it rebought at a cheaper price earlier this month. But it’s a fairly new position for me. I know you’re rocking it for the cashflow specifically but for me new shares = cash + potential appreciation.
Hey David. Thanks for watching and for the thoughtful comment.
I think JEPQ is great for both (DRIP on or off). It's great on because it keeps snowballing higher dividends. When the market crashes, it's even better! The higher volatility helps the premium income & you buy more shares per dollar reinvested if the value drops. It's a win / win.
I personally turn drip off because I love the idea of 'DRIPing' the JEPQ dividends into things like SCHD. I feel like it gives me the best of both worlds (more cash *now* with JEPQ flowing and more cash 'growth' later with SCHD building).
Short answer is that I think JEPQ is great to reinvest the dividends into itself *or* to your other positions. I love the consistent monthly income from it.
GREAT video Jeff... Love your portfolio summary and disclosure as well as your honesty. Love hearing your logic and thoughts as well behind your various moves. Presuming you hold the JEPQ in a taxable/Brokerage account - and will juts have to take the hit on taxes...??? I have JEOQ set up in my IRA's and have not done that move into my taxable yet. I do believe I will start doing so in the near future to bolster my Taxable acct to get more dividends flowing. Have many holdings with low dividend payout but fast growers..... Again,l thank you for the video - appreciate all of your efforts each week. Please be well and let's get you more subs... 10k + now....
Hey Lance. Thanks for watching and for your extra level of support as always. JEPQ is much better in a tax protected account (because most of the dividends are non-qualified). In my situation, the extra income is needed and the taxes are what they are (as if I pulled it out of the IRA and it added to my taxable income). In a perfect world, I would have SCHD in the taxable and JEPQ (or more likely, QQQM) in the IRAs next to VGT. This is opposite of how many others do it, but it would reduce my taxable income (assuming I needed the SCHD cash-flow to live on, it is basically 'free money' at that point when wife and I make less than $123k per year in retirement, 0% taxes) *and* not or, I could pull some money to fill up the 12% tax bracket from the IRA (pulling more out to stay in proper bracket).
If VGT + QQQM were in taxable, I could live on those qualified dividends, but it is less of a yield and therefore less 'free money'. I would have to pull SCHD dividends out of IRA, which converts them to 'ordinary income'. Less money in my pocket for the same 12% bracket fill up. The qualified dividends are forever lost when coming from an IRA (they 'convert the gains' to 'ordinary income' no matter what).
@@JeffTeeples Thank you.... Trying to beef up the taxable with higher yielding Qualified holdings.... I do have SCHD & DGRO in there as well as some of those growers not showers I spoke about (V, COST, NVDA, LLY, + some old guard like PG, PEP, JNJ, CVX, ABBV, HSY) as well as my Tech ETF XLK. I just reinvest and do not collect dividends - yet - as I have my pensions for everyday living - but was thinking to possible do so for trips etc.... Investing is truly a science and numbers game... Just trying to get all the rules and strategies digested the best I know how. Thank you again for all you do for us....
I wish I could give you my roth to clean up all the etfs I went crazy buying and pick the top 10 maybe..lol
haha, been there before. The beauty about Roth accounts is that you can sell everything, and buy the ones you want without any tax implications. Feel free to clean it up any day the market is open (:
With taxable accounts it can be a little trickier from a tax perspective.
Hi Jeff, For someone in his early 40's
The logic of investing DCA into JEPQ for 10-15 years and turn DRIP off in order for during that 10-15 years period reinvest that dividend into the SCHD for example is that after 15 years if I turn DRIP back on I can never run out of money from JEPQ? Since I never sell it?
I hope my question make sense but mainly I am trying to understand if for JEPQ obviously I don't use the 4% rule and don't sell it can I run out of money in that investment once I stop investing into it.
Thanks mentor
Hey Idan. I think JEPQ with dividends reinvested in SCHD or JEPQ is a great way to build shares and cash-flow long-term.
However, for someone that doesn't need the cash now, I think QQQM is better than JEPQ for ultimate cash flow long-term if that makes sense.
After 15 years, QQQM will very likely have a higher total return than JEPQ (how the funds work will normally prove this out, JEPQ sacrifices growth for cash-flow, and has a high expense ratio).
If I didn't *need* cash now to pay the bills, I would use QQQM over JEPQ. I happen to have both, but I hold on to, and add more JEPQ to help pay our actual bills now (I lost 100% of my income, and I was well over half the household income). Mortgage and two kids aren't cheap.
I do think JEPQ + SCHD will work for all durations, but VOO or growth ETFs are 'better' for people with 15 or more years to invest (time to ride out the waves and dollar cost average in).
Really, just picking a system and sticking to it in the good and bad times is the way to win. There are countless 'right ways' to do it. Going with our guts in certain markets is *never* the right way. Set up a system that works for you and stay the course.
Great update!!!
Thanks Jay. I appreciate you taking the time to watch the video and for dropping a comment. My portfolio has crossed $1.425M again. What a crazy ride. I do my best not to jump overboard regardless of the waves.
keep it going Jeff
Thanks for the kind words Gabbar. Will do!
When you speak about custodial account, are you referring to a UTMA?
I have him in a Roth IRA because he works and has earned income. This is better than a UTMA which is a taxable account (to my knowledge).
Similar concept. He works, gives me money, and I invest it for him in a Roth that will be tax free forever for him.
He’ll take over at 18 years old (he’s 16). My other two have already taken over their Roth IRAs (18 and 20).
Ahh is this the Roth IRA for kids? I have a soon to be two years old and want to invest for him. Since he doesn’t have earned income, would the UTMA be the best route?
It's tough to say if there is a universal 'best' way to do it.
The UTMA can help save you tax money when you invest for your kid. Just know that when he/she turns 18 or 21 (depending on state) the money is 100% theirs and they can do what they want (sometimes a bit scary depending on the kid).
A 529 may be better if you are in a state that allows it to be a tax deductible contribution. Although, then the argument could be if they go to school or have qualified events to use the 529 money. The UTMA is more universal to be used towards anything in life.
Living in WA I have zero desire to start a 529 for either of my children. It doesn't make sense here (IMO). I will maximize my current investing system, and get them started on a Roth IRA as soon as possible (if they work before 18). I'll utilize gifts and step up cost basis to get them the money tax free some day.
A lot can change between now and then (they are 2 and 4), but that is how I'm approaching it at the moment. Don't want any weird risks (them not going to school and penalty on 529, or them blowing a UTMA when they are 18 years old and dumb, etc).
Thanks Jeff! You’re the best.
Really enjoying this Sunday morning videos thanks for sharing, i have a pretty decent sum in vanguard mm and playing with the thought to split it in 50/50 jepq/jepi to gain more div 😊 but im not sure if i label this sum as emergency or investing Lol thanks again for your videos im learning a lot😊 😊😊😊
Thank you for watching and for always leaving quality feedback. I appreciate you taking the time out of your Sunday's each week.
Do you you Vti is pointless since it drags too many companies?
I think VTI is a solid ETF. I slightly prefer VOO for my balanced cornerstone, personally, but find them to be fairly interchangeable.
I know I spoke to you about this before, but it would seem to me all you will ever buy in bull market is SCHD and buy VOO and Growth etf during downturns. Is there a good way to see if juts DCA 33.3% (repeating of course) would be better worse or same.
Rebalance testing will not work before the market reverts to the mean. Having the buy the same no matter what strategy has slightly better results than target allocations with SCHD and VGT. But this makes sense because we are in a historic 10+ year bull run right now without the reversion.
In other words, even buys would be 'extremely heavy' in VGT right now (without target allocation buying or rebalancing). As soon as the mean reverts, the target allocation portfolio would be significantly better. This is because it is mathematically impossible to not buy the comparative dip with target allocations. Again, assuming the investments are good in general (there are such thing as bad stocks and ETFs at all times in all markets).
This has been tested throughout 100+ year history, but, we can't look at stuff that has only existed the past decade, yet. It is factually better to use target allocations (assuming a reasonably balanced strategy in general) over many years / decades.
But 'right now', it hasn't 'worked' as well in the past decade and change. We have our long-term blinders on lately.
Another way to look at it is that it is impossible to not have more of both holdings long-term after multiple swings (because you are only buying both when they are 'comparatively lower'.
Actually, that is a good video idea. I should make a spreadsheet to show that (with ETF A and ETF B).
very thorough analysis as always! Jeff - do you have a video (I searched but did not find one) about the best placement of specific ETFs (market, growth, dividend) into regular brokerage, Roth and 401(k). I think it is a very confusing topic and a lot of people will appreciate your insight. I assume you live in WA with no state tax. would it change the placement (eg moving SCHD to IRA or Roth) if you lived in a state with high state tax? I live in Maryland and the state takes 9.3% so real tax on qualified dividend is 24% or so:(
Hey Mervyn. Thanks for the positive feedback. That is a great video idea! I've touched on taxable vs Roth vs traditional in a few videos, but I don't think I've ever made it *thee* video topic. I do live in WA State, so I would need to do a little refresher before getting into state taxes. I do have a master's degree in accounting and a lot of experience in finance, but I am not a 'tax expert' and have always lived in a no income tax state.
I know enough to be dangerous (:
Loved your video... easy casual friendly voice.... non preachy non pretentious very genuine and caring smart ...... instant subscribe...
Quick question is it wise to buy in on QQQM I know it's 0.05 points cheaper than QQQ but then don't you think you might have better premiums on QQQ when you sell options on them in retirement ?
Thank you for the kind words. I appreciate you taking the time to watch the video and for leaving a comment.
I think QQQM is better for buy & hold investors. QQQ is preferred if you will be trading options for extra income (because of the volume advantage).
Really they are both great. If you have a lot of QQQ in a taxable account, I wouldn't sell it to buy QQQM. I would put new purchases into QQQM, and then prioritize selling QQQ first when/if you need to update to target allocations with a rebalance. A 5 basis point difference isn't a reason to make unnecessary moves.
Hello Jeff, and thank you for your endless efforts to share the knowledge! What do you think about QQQI and do you think it's reasonable to have both: QQQI and JEPQ in one portfolio? Is this only about deversification, or is there something else? Thank you!
Thanks for taking the time to watch the video and for the question. QQQI and JEPQ are very similar in that they both use the Nasdaq-100 for the underlying holdings and write call options to produce dividends. I prefer JEPQ more because of the lower expense ratio 35 vs 68 basis points. They are very similar in nature to where they don't necessarily diversify your portfolio if you have both.
It would be like having VOO and VTI. It doesn't hurt anything to to have both, but it doesn't necessarily do anything different than either or.
Great video Jeff as always!! Thank you so much! I have a question about QQQM. What’s the difference between QQQM and QQQ other than the price is different and the fees are different? Thank you so much! I remember you buy QQQM instead of QQQ.
Thanks for watching and for the kind words Jane. I appreciate it. QQQM and QQQ have the same holdings (at least they follow the same exact index). You 'basically' get the exact same product at a lower cost with QQQM instead of QQQ.
QQQ is older and QQQM was made to be competitive with other major growth ETFs that have a lower expense ratio, like SCHG.
@@JeffTeeples Thank you so much Jeff! Really appreciate your explanations. That's great to know! You know so much. I know I can definitely learn a lot from you :)
Have you considered SPYI for cash flow purposes ?
Hey Blaine. I have been keeping an eye on SPYI. It is still quite new, and I haven't officially added it to my ETF tracker spreadsheet, but I'm curious to see how it does in the future. It does violate my hard requirement of staying below 50 basis points on the expense ratio.
Love this kind of portfolio Jeff. Thanks so much for sharing.
I might have missed it. Which account do you hold ibit and jepq? Is there a tax drag on it ?
Huge numbers fan. Love seeing the breakdowns on allocation like this.
Thanks for taking the time to watch the video and for leaving positive feedback.
I hold IBIT and JEPQ in my taxable brokerage account. With JEPQ, it is not ideal in a perfect world. However, I need the cash-flow now, and I'm under 59.5 years old. It is the lessor of two evils from a tax perspective.
If I didn't need the cash now, I could avoid some ordinary income by sticking it in a tax protected account. It counts as ordinary income, my wife and I consider it an employee that works for us to pay us a bonus each month (:
IBIT is a buy and hold. I will only sell long-term capital gains or losses as I keep it between 2% and 3% of my portfolio. It's ideal there as it pays zero dividends and I have full control of taxes.
@@JeffTeeples makes perfect sense. I like both of those funds quite a bit. Looking to stashing them in the Sep Ira. To avoid some of the taxes for the time being. Down the line may convert some Voo into these. Great motivation sharing and seeing a portfolio of this size Jeff!
That's the best thing about being over 59.5 - maybe the only thing! 😄 I've got JEPQ and the majority of my dividend payers in my Roth. I'm still dripping the dividends thru Q3, maybe Q4.
Haha Charlie, no doubt! Sometimes I'll tell my dad 'I wish I was 60 so I could put my JEPQ into my tax protected accounts' and he'll say 'no you don't'. (:
Thank you for the video, very good! I never saw my name as a new member 😢😭
Hey Ivan. I appreciate you watching the videos, dropping comments, and for going above and beyond as a channel member. It helps and means a lot.
Your shoutout was on 'The Power of Compound Interest' video. I appreciate you!
I need to find a way to have a ticker at the bottom of my videos scroll through this awesome member community.
@@JeffTeeples Thank you
Are you thinking of moving (or have already moved) some money from SCHD/DGRO to VGT? Just curious.
I don't move money from VGT to SCHD or vise versa (in the literal sense). But I do is put 'new money' into SCHD if my growth ETFs are higher, and I put it into the growth ETFs if SCHD is higher.
It allows me to always buy the relative dip in my portfolio by default with new contributions. I like the 50/50 balance (and then VOO is always a big chunk, but it is a hybrid of growth and value in and of itself).
@@JeffTeeples That's a good way to manage the balance. Thanks for the reply.
Good video, thanks! I am curious what you think of SVOL for cash flow?
Thanks for watching Alex. I'm not a huge fan of SVOL because of the crazy high 1.16% expense ratio and the way that it produces income. I want to see if it is sustainable over a long period of time.
However, it has been *incredible* since inception. So far, the result have spoken for themselves. I'm not a hater on this one, just a bit skeptical.
All you need to know about SVOL: ua-cam.com/video/RYbzmgosmkg/v-deo.html
Do you think is worth it having O realty income for long term dividends. I do own VGT. SCHD, VTI, QQQM. O is my only single stock 233 shares. Sometimes I feel like selling it since I’m up and add it to my SCHD position what you think.
That's a great question Oscar. O is my favorite (basically) 'REIT' out there. It is what I would own to get exposure to real estate. I prefer SCHD, but I think having both can be a great idea too. O comes with more yield, but less dividend growth rate. Won't hurt your portfolio unless it is a very large position. That's my two cents on it.
@@JeffTeeples your absolutely right that’s one of the reasons why I kept O because is my favorite reit hands down. I guys I’ll keep it for long term since I do love the dividend and continues to add a small portion in it 100 dollars weekly. Thank you! For your respond love your videos by the way I love your long term portfolio.
What is your thoughts on buffered etf like innovators PJUN. The Innovator U.S. Equity Power Buffer ETF™ seeks to track the return of the SPDR S&P 500 ETF Trust (SPY), up to a predetermined cap, while buffering investors against the first 15% of losses over the outcome period. The ETF caps the gains 13.38 with expenses ratio of .79%. What are in your opinion the pros and cons?
Hi Felice. I don't like any ETF with an expense ratio greater than 50 basis points. It is the number one predictor of future results (other things equal). And capped ups and downs don't work out well over time. For example, and granted, it has been a bull of a run, but still, here is the 5 year total returns of PJUN vs VOO (what it is basing caps on):
VOO: 108.28%
PJUN: 38.14%
I have never seen a capped fund outperform a benchmark over 30+ years. I don't think it is possible. It's like me preferring SCHD to BND for passive income. It will 'always' do better 'long-term' regardless of the short term implications. I'm a big advocate of zooming out as much as possible when viewing data.
Is FTEC better than VGT?
No.
Fetch has lower expense ratio. Tracks same index.. it barely beats ftec... ftec is cheaper.. I'd rather have ftec ..
I think FTEC is great.
Glad to see you have SWPPX! That's my favorite thing about Schwab, awesome product. Now if Schwab could just get on board with the M1 Finance fractional shares "Pie" instead of Schwab Slices...
To use your expression, I should just "rip off the bandaid" and open a M1 acct. Do you have an affiliate link for that?
Hey Chris. It's funny, my wife and I were chatting this weekend (well I was talking and she was humoring me by pretending to care lol) about how I wish E*Trade had the M1 Pies.
I do have an affiliate link for it. It hasn't gotten me (or more importantly, the person using it) and bonuses for some reason. But if you want to start I would appreciate you giving it a try. Thanks for asking!
My M1 link:
m1.finance/qKHE6cu7jKp9
Schwab has some great funds that I like. Of course, my 3rd child, SCHD comes to mind (:
Thanks for watching and for your extra level of support for the channel.
@@JeffTeeples So with M1 it looks like I need a minimum $10K balance to avoid monthly fees. It's going to take me a while to shuffle the coconut shells to make that happen. But, when I do use the link I'll let you know just so we both can see if M1 gives either of us a little extra love.
Awesome Chris. Much appreciated. They added that new fee earlier this year. I'm not a huge fan of it, but I still think it is worth using all things considered.
Uff so mine is a mess 30% schd 25% fepi 25% svol 20% QDTE I know I know is bad but but my roth is 30% DGRO 30% JEPQ 30%IDVO and 10% Svol
Thank you for watching and commenting. I don't think yours is bad at all. We all have different goals and risk tolerances, and I think you will cash flow just fine with your mix moving into the future.
I have about 600,000 in market! How long u think it take to hit a million? I invest about 1000 per month
Thanks for watching and for the question. I'll say 4 years and 11 months! That is using $600k to start, $1k per month, and 9% annual returns.
Shout out to Mrs. Teeples 402k in 401k/HSA that's amazing!
Hey Oldrin. Oh man, we put a major emphasis on our 401ks early on. It was the best move we ever made! Not only is it free money with the company match (always start with at least enough to get the full match), but it also was tax efficient money directly into the S&P 500 (beyond the match). I realized that besides paying the bills and getting out of our massive debt, every extra penny should go into our 401ks.
The tax savings added up (that whole compound thing) like crazy over the years compared to using taxable accounts. Now, it's nice to have access to the money, but I cared way more about growing it at the time. Started taxable investments a few years in to start building that too.
We weren't able to max our 401ks for a looooong time. We did finally get to the point (like now) where maxing 401ks was 'a bill' that we slowly worked to with lifestyle changes (more accurately, NOT life styling up with little raises).
For context, we made $94k combined and had $90k debt when we started at Boeing (2010). Now we did work up with hard work, but looking at my portfolio now one may assume 'who cares about the little things it's over 1mm'. But the little things were *everything*. My 2013 Honda Civic is still running great, which replaced my 99 Honda Civic. Nothing is easy unless you make a TON of money (like some of my friends, lol).
I'm as 'normal' as it gets. I want to help people that are a lot smarter than me get ahead for good. Financial freedom (:
Quick edit: Our 401k had (basically) zero fees and a great S&P 500 option at Boeing. If the 401k options are bad, it may make sense to look to a Roth IRA or traditional IRA first before going beyond the company match amount.
wealthy😁
Thanks for watching and for leaving a comment. It's a grind with a lot of 'less fun' decisions involved (for delayed gratification), but we are slowly getting there. 42 years old and 2 Honda Civics to my name (lifetime) help feather more money in to the portfolio. Tons of other little things as well. That is why the passion for this stuff burns for me, *anyone* can do this. Truly.
Love your videos and content. For me the music in the background is disturbing. Thanks
Thanks for watching and for the positive feedback. I appreciate it. Been working on making the music quieter in the background. I think this one might have been a little too loud. Zero music is a hard no for me.
First! lol
You beat me! I randomly woke up today at 5:57 am and I was tempted to get on to be 'first' on the comments for this video. I used to do that on multiple forums / articles I followed. I was too lazy today and you win!
I’m trying to keep that mindset too, especially when I see crypto like Bitcoin taking hits. Anyone else think that diversifying into something like a crypto IRA might be the move? I’ve been using My Digital Money for that, and it’s been pretty smooth sailing so far. What do you all think about that strategy?
I like crypto as a wild card for my portfolio. But I don't believe it in long-term like I do quality companies that produce products and services. I think staying under 5% is wise.
Just friendly ribbing here... #dogearmy -> #dogedeserter :-) But I can't really throw shade. While I never bought Doge, I did buy Cardano and keep waiting for that rocket to the moon. Joking aside, since I'm about 6 months away from retirement, I'm also beefing up JEPQ vs working longer. Congrats on obliterating your YTD dividend progress!!
Haha, love it Eric. Got a nice chuckle this morning from this one. And you're right, I am officially a Doge deserter that I have jokingly picked on for years! (:
Very nice on the JEPQ. I know people are mixed on it, but I think it is great cash-flow with a well established underlying index. QQQM is better for the young bucks with 20+ years to invest before retirement, but JEPQ is a solid cash-flower for right now. SCHD is still my long-term horse for dividend growth. I'm going with the dividends reinvested from JEPQ to SCHD & friends strategy.
Thanks!
Thank you Brianna! I appreciate your amazing support of the channel!