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Strategies & Market Trends : Dividend investing for retirement -- Ignore unavailable to you. Want to Upgrade?

To: Steve Felix who wrote (6068)	10/12/2010 6:08:57 PM
From: JimisJim	1 Recommendation Read Replies (1) \| Respond to of 34328

I think many simply don't consider the case where dividends are reinvested over a long time frame and only look at the original purchase and calculate total returns as if the dividends are collected in cash and the position never grows total shares. Once you get past that, the longer the time frame, the more dramatic the total return on original purchase becomes. If a stock grows its dividends such that the position doubles in 7-10 years, you'd have to have a quick double in cap gains to match the total return if one is not reinvesting dividends or only watching cap gains... now double it again in 7-10 more years... and again... and pretty soon, you have to pick stocks that have 8X cap gains to match the total return on a good company with steadily growing dividends with those dividends reinvested over the holding period, or until the income stream is actually needed in retirement. That's why the issue is different for everyone... for the kids, it's a no brainer in this market, but if you are already 60, and just starting down the dividend road, things are very different. Jim

To: Steve Felix who wrote (6068)	10/12/2010 9:56:33 PM
From: Elroy	Read Replies (2) \| Respond to of 34328

Here's a question for you. I've got two kids, both less than 3. If I want to setup an individual investment account for them is there a tax smart way to do it? In other words, they won't even get to see what's in the account for at least 14 years or so, but if it does well it might require them to start paying taxes at some point depending on how the investments do. Is there some way to minimize tax burden for an infant?! Seems like an odd question, but someone must know the answer.