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Non-Tech : Kirk's Market Thoughts
COHR 191.37-0.3%9:30 AM EST
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To: Kirk © who wrote (5825)6/1/2018 2:05:16 PM
From: Jerome  Read Replies (3) of 26837
 
Hi Kirk, This is how to beat the 8% ( per year) discount by taking SS at the earliest date.

But there are a few rules to be aware of.

1) Pick a stock with solid and increasing dividends. (BP is the example for this post)The dividend is .60 per share. or $60.00 per hundred shares. And BP said they are looking to increase the dividend soon.

2) Buy the stock and use the quarterly dividends to buy more shares of the stock.

3) BP is appreciating in price and so are the shares purchased with the dividends.

I have done this with my BP shares for the past two years and here is how it played out.

Over a period of two years (starting 06/17/2016) and 8 dividend payments, the dividends had a value ( if taken in cash )of $745.00.

But as of today the dividends of $745.00 invested in shares are now worth $969.00, or about a 30% increase.

This will not work with every dividend stock.....the stock should have appreciation potential, and the likelihood of dividend increases.

Besides British Petroleum I would suggest looking at Kinder Morgan Pipelines (KMI) (16.81 per share and a 5.01% dividend yield. The have committed to increasing the dividend to $1.00 next year and $1.20 in 2020.

Stocks in the recovery phase of a cycle do best with this plan ,because they have the best potential for appreciation.

Taking the dividends in shares does not incur a purchase fee on the transaction .

Its a modest gamble but so is marriage, longevity, health, and the stock market.

Jerome



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