I find that if I am swapping out one for another I just do it. When I have built cash in my account I am more selective and look at the price more.
I'll throw out what I have just done with my daughters account here, although I'll probably hear about it. lol!
I seem to have brought it up at just the right time, as she was very receptive. I explained that I used our home town bank to get her started, and they could be bought out tomorrow at a much higher price. Odds are though that that doesn't happen and their dividend doesn't grow like it could in some other stocks.
I then explained that because of when she had added money, PSEC was bought (at 10.91 and they had already declared their next .40 dividend) for short term, not long term.
We talked a little about diversification. I threw out ED and PPL as nearby utilities and WM in the garbage business, doing a little steering. Between ED and PPL she wanted to know which has been raising their dividend more. I couldn't believe the interest!
I told her I wanted to set up dividend reinvestment and just add to the positions for the next few years. She told me that she would give me two $2500 checks each year, but that she may want to buy something new with one of them. I was having a hard time believing what I was hearing.
I think having her own apartment for the month of January while her fiance was here gave them a chance to settle some of her worries about the future.
She wanted to know if there weren't any 3% dividend stocks that could well outpace the market over the next 20 plus years.
Good or bad, we settled on one, but I would like to see what others would choose.
Anyway, ACNB and PSEC are gone, PPL, WM and ? are added. I've already sent an e-mail to get reinvestment of all started.
Discussion with my daughter was as they say, priceless. |
