Why I Don’t Like Dividend Investing In The Stock Market

Dividend investing is a very popular strategy lately. New videos pop up every day about how much dividend income people made from investing in certain companies. Even though on the surface it looks like an easy way to earn passive income from investing, I'm not a big fan of the strategy.
In this video, I'll give you my thoughts on dividend investing and why this doesn't make sense for myself and most people who think this is a great way to grow their money in the stock market.
Check out Denis's video on why he invests for dividends: • Dividend Investing vs ...
Video on The Irrelevance of Dividends: • The Irrelevance of Div...
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#dividend #investing #StockMarket

[@JarradMorrow]

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[@HansMcGruber]

People are get locked in to one strategy or another, and then everyone else is wrong. So stupid. I have a mix of dividend growth and pure growth stocks.

[@JarradMorrow]

Sounds like a good mix that works for you.

[@mikeylovespizza4012]

Same here. I have no one strategy as sectors and stock performances varies. I have both short and long term investments. Also, have dividend income.

[@nathanamos9945]

What are your thoughts on REITs and BDCs? They are required to pay 90% of profits to shareholders as far as I know. Do you consider that as a dividend per se? Also, do you think those are good investments?

[@JarradMorrow]

Not familiar with BDC's but REITS are a perfectly fine way to diversify your portfolio if that's what you're looking for.

[@ronnix23]

I invest for both growth and income. I disagree with your point concerning taxes. The only way to avoid paying taxes is to not earn any money, and who wants that. I currently have only dividend stocks in a Roth, and both dividend and growth stocks in a brokerage account. The taxes don't concern me as qualified dividends are taxed at 15% which is less than the 25% I would pay at my standard income level. One thing having dividends allows you to do is to avoid having to sell growth stocks in a down market for income. That's why I think it makes sense to have both growth and dividend stocks.

[@JarradMorrow]

Thanks for sharing your thoughts

[@Goldsavergamer]

Rod Nixon just become Canadian. We have a thing called tax free savings account (TFSA) it’s a registered account where you can earn tax free income within that account. Got rules attached to it like max contribution limits, but ya basically tax free income!

[@JarradMorrow]

You mean *marry a Canadian 😃👍🏻

[@Goldsavergamer]

Jarrad Morrow haha ya, faster than getting citizenship

[@raymondcunanan5016]

I agree to everything. I have diversified individual high growth stocks and treat the capital gains as dividends. But only difference is, i decide when to get the capital gains. So far, im being a true investor by investing long term. I dont need dividends IMO.

[@JarradMorrow]

Thanks for sharing!

[@qmakesithappen]

Very sensible and logical my man, when you really get in the weeds of everything it's impossible not to see the give or take. Most of the dividends are typically reinvested anyway which is essentially selling shares and buying them back. Great video 👌🏽

[@JarradMorrow]

I appreciate that

[@user-jt4nq8qg7t]

What do you do with dividend returns from your Roth IRA and individual investment accounts?

[@JarradMorrow]

I'm still in the accumulation phase of investing so all of my dividends get reinvested

[@user-jt4nq8qg7t]

@@JarradMorrow So do you just end up paying taxes on them, then? Or is there a workaround you have found to cleanly reinvest?

[@roveirdatu3851]

Sorry I just don’t agee on this. I would actually prefer to put growth stocks in my Roth and dividend stock on a regular acct like Robinhood.

[@JarradMorrow]

👍🏻

[@keavehines3276]

Very great points! Thank you for the video, very informative!

[@JarradMorrow]

👍🏻

[@zachkirk1618]

I respect and understand your view but I think you're just wrong. The value of a stock doesn’t matter to dividend investors and saying a company will randomly stop paying it’s dividends is like saying to a value investor that they shouldnt invest because the stock they own will probably fall in value. Dividend investors target good growth companies that wont fall tremendously in value and one that has a track record of always increasing its dividend, so using a random stock that doesnt fit the niche of dividend growth investors is misleading. You will also pay taxes on a stock you sell so whats your point? Dividend investors strategically invest so they know how much money they will be paid out not “They dont get to choose how much they get paid"

[@JarradMorrow]

Thanks for sharing your thoughts. It sounds like a lot of work to be a dividend investor who picks individual stocks. If that's their thing and they actually understand what they're doing then I think that's great. Like I said in the video, a partially flawed strategy that you stick to is better than the perfect strategy that you do not stick to.

[@jasonkirkcaldy7463]

Zach Jarrad also is ignoring the power of compounding dividend DRIP investing. Saying that dividend investing is partially flawed is such a ridiculous thing to say. This video makes me cringe knowing that he is misleading so many young investors.

[@JarradMorrow]

I'm not ignoring the power of compound interest from dividends. I'm not even saying that investing in companies who pay out dividends is flawed. I said that only investing in a company for their dividends probably isn't the best idea for me and most people unless they're willing to do the research involved to do it properly. And even then you're still just taking on another form of stock picking. I think it's better to have a nice mix of dividend paying companies along with growth stocks as well. Try to remove your bias and re-watch the video.

[@florent2467]

Jason Kirkcaldy Man this is simple math... the dividend you get are substracted from the stock price everytime it gets paid to you. 4% of dividend or selling 4% of your stock is EXACTLY the same thing. Dividend is even worst since you are selling (getting dividend) even when the stock price is crashing. Dividend investors think it’s great but that’s the opposite of great... Dud, take a paper and do the math

[@jasonkirkcaldy7463]

florent B Maybe you need to study dividends before you tell others about them

[@LegendaryJTV]

If this is the case then I assume that you do not believe in compounding interest as well? And a few errors that I want to point out. 1. A stock's price is reduced by the amount of the dividend on a specific date called the ex-dividend date. This is the day before the record date and it is far before the payout date. 2. Most stocks recover within 4 days of their ex-date. In your example if the stock gets back to $100 you're essentially at $102. 3. Most companies that are "dividend companies" happen to be in the in the maturity stage of the business life-cycle and the law of diminishing returns are dictating to that company that if they invest any further into their business it would not benefit from exponential growth.

[@JarradMorrow]

I never said I don't believe in compound interest. I never even said that dividends don't matter. I made this very clear in the video. 1. Agreed. The price still reduces by the dividend amount. What's your point? 2. They may "recover", but that recovery doesn't necessarily have anything to do with the dividend. We can hypothesize that it might go up because I'd bet a lot of people re-invest their dividends (which is smart), but this still isn't a reason to invest only for dividends. 3. I agree and understand this. But companies still borrow money to pay out a cash dividend.

[@elgringuitoojosclaros2831]

Hey Jarrad. Awesome content here. What are your thoughts on investing in companies that pay a dividend, but are still growing revenue? (FB, PII, BMY, CCL, etc) 1-4% payout and still growth prospects. Also. Curious if you’ve heard of the Dividend Kings and their fast graphs approach to investing? Thanks again for the video!

[@JarradMorrow]

Thanks. No, I don't think theres anything wrong with investing in companies that pay out a dividend that are growing revenue. Never heard of the fast graphs approach.

[@coconutsfor2963]

When the economy took a downturn what hurt me the most was my real estate not my dividends they keep paying- I was underwater on those houses for all long ass time - got rid of those headaches. ✌🏽

[@JarradMorrow]

I'm glad you found an investment that works for you.

[@ansatsu34]

My main portfolio is VTSAX. I was thinking about creating a side dividend portfolio since i had cash laying around but not so sure now.

[@TruFinancials]

I love your passion in the video, Jarrad. You hit a great point on at least investing even if there is a flaw in your process because you are moving the needle forward. I still love dividend investing, but I do focus on the growth aspect a stock can have as a factor in buying them and not solely on their dividends.

[@JarradMorrow]

I liked your video with an opposing view to time. We can agree to disagree and still be friends.

[@TruFinancials]

@@JarradMorrow - I agree!

[@HiddenFreedom]

interesting hearing both your perspectives.

[@chrisbacon2637]

I think your confusing a few things when you taking about dividend investing only picking a few companies (I have 32 in my dividend portfolio) presenting a risk.. for starters when your invest in dividends you mainly looking for companies with a wide moat, secure business model and most important lots of good cash flow so I know the quarterly/monthly payments will be secure. For example I own shares in Pepsi have done for a while. I can always be wrong but I'm reasonably confident Pepsi as a company isn't going anyplace any time soon and as well as the dividend I also get capital appreciation. And all I have to do is check its statements once a quarter to make sure everything is in good order.. What your referring to is more down to trading price action and volatility.. which I admit is harder to do but it depends on your time frame.

[@JarradMorrow]

Thanks for sharing your thoughts.

[@Billsfan01]

I am sorry but I definitely do not agree with your view on dividend stocks, the idea is to buy value into stocks that pay a dividend preferbley one that has paid dividends back to shareholder for numerous years. This is a strategy that works for all ages.

[@JarradMorrow]

Thanks for sharing your opinion.

[@ericbarnes3619]

Your grandpa gives good advice. My grandaddy set up a Roth IRA for me back when I was younger and invested in VIGAX. I'm thinking he would agree with your video.

[@JarradMorrow]

Your grandpa is a smart man as well!

[@Shadez23]

I agree to an extent however if you're reinvesting that dividend to compound your gains and you do so by screening the companies with the appropriate criteria you're less likely to fall into trap. People seeking just high yields are bound to fail at some point.

[@JarradMorrow]

True, but I'd be surprised if most people are able to take their emotions out of the process 100% of the time to follow the appropriate criteria. You're giving us humans too much credit :)

[@Shadez23]

@@JarradMorrow lol that's true... The FOMO is real. I've seen some people's portfolios that are concerning but failure is the greatest teacher.

[@Gazziza29]

MillerLyte 23 My question is this. Let’s say you get a dividend at 3% and keep on reinvesting it and it compounds. You leave it there for 20-30 years to grow. Would it just not be better to invest for growth in something that more stable, predictable, and a hell of a lot less time consuming such an Index Fund that grows at 8%? If you’re just going to leave it in there anyways until you retire why would I want dividends from companies that are more volatile than those in a broad based Index fund?

[@Shadez23]

@@Gazziza29 the objective is to reinvest your earnings while continuing to invest new income which is where you'll compound your gains over time. Growth is not guaranteed either, I'll give you most of us have gotten accustomed to this bull market the last 11-12 years but that doesn't mean we'll grow forever. Regardless, neither choice is wrong I've seen some people with both a growth and dividend portfolio so it really comes down to personal preference, so long as you do your homework and manage your risk appropriately.

[@raymondcunanan5016]

I dont understand the others, i think your strategy is very smart specially for young investors. Maybe those negative comments are from near retiring stage , so it depends i guess.

[@JarradMorrow]

Thanks

[@arcaneknight9799]

My investing strategy is the same as yours with the exception of me investing in Tesla, Square, and Illumina in an individual account. I just dollar cost average in every two weeks, just like I do with my Roth IRA.

[@JarradMorrow]

Good stuff!

[@mamonk226]

Two issues: How can say dividend investing is labor intensive 8:30 but then recommend growing your own business and real estate 9:35, which are way more so? 2) The reason investors underperform is because they don't stick to their strategy. As you said, sticking to an imperfect strategy is better than not sticking to a perfect strategy.

[@JarradMorrow]

1. You have way more control when you invest in a business and real estate. With investing in the stock market you can do all the research in the world and you still have zero control over what happens with that stock. As I said in the video, even experts in the field with access to more data than you'd know what to do with can't outperform a standard index. Little old you isn't going to influence the market. If you think you can then you need to give your ego a little gut check. 2. You just said that people underperform because they don't stick to their strategy. Therefore, they're not sticking to the "imperfect strategy". Obviously they're going to suffer. Not sure what point you were trying to get across with this "issue". Any more issues? I'd love to hear them.

[@mamonk226]

@@JarradMorrow You didn't respond to RE and business ownership being more labor intensive. Btw, you don't need to "influence" the stock you buy for it to go up. Its a passive investment, unlike RE and BO. You also don't need nearly as much data to outperform big money managers to outperform. My other point is that sticking to a high-dividend growth strategy will lead to outperformance. Sticking to the strategy is completely within your control.

[@mikeylovespizza4012]

Both are good points. I believe there were studies done of dividend vs non dividend investments and historically dividend paying with stock growth outperformed stock growth stocks.

[@JarradMorrow]

Reading the financial reports of every company you invest in every time they come out is pretty labor intensive. That's the proper way to evaluate a single stock for investing. The point I made in the video about this is that I already have enough money in the market that I don't have much control over. If I'm going to invest more money then I'd rather put it into something I have more control over like RE and businesses. You're right, you don't need a bunch of data to outperform big money managers- you just need "luck". Luck is not an investing strategy. Sticking to a high-dividend growth strategy could lead to outperformance... if you pick the correct dividend stocks to invest in. Unfortunately, you have no idea which ones those will be.

[@JarradMorrow]

It could outperform if you pick the right combination of stocks. Unfortunately there's a lot of combinations to choose from. I don't have an issue with investing in dividend stocks, I have an issue with only investing in dividend stocks for their "income" and people not properly vetting a single stock before they put money into it.

[@davidtravis17]

Great video, buddy. Good for you to educate the masses using facts. You're not wrong either. You've earned a subscriber 👌🏽

[@JarradMorrow]

Thanks!

[@MrFr3shswagg]

Straight to the point. You are the man.

[@JarradMorrow]

👍🏻

[@doomtomb3]

One argument I hope you address is that selling off shares to take profits i.e. income stream can have a negative effect due to timing. Imagine you own several company's shares and you sell Company A shares instead of B and C right before A doubles in price for XYZ reason. With dividend income, you never have to sell shares to take a fixed income. You're basically doubling risk by having to time BUYS and SELLS, i.e. day trading. Ya, sure you can hold it long time before you sell but there's a 99% you'll regret it later.

[@JarradMorrow]

Thanks for sharing your thoughts.

[@zhangguo6752]

I probably fell into this trap of listening to dividend investor youtubers. I used to be around 80% sp500 (VFINX) and 20% international (VTIAX) but now sp500 is down to 60% when I started buying more high dividend etf (VYM) instead. I don't pick any individual stocks so pretty much all index funds/ etf. Maybe I should get that sp500 up more again lol.

[@JarradMorrow]

There's a ton of dividend investing videos out there lately so I don't blame you. After I kept seeing them over and over again I started to question how I was investing. This forced me to do hours and hours of research to really understand dividend investing at a deeper level. I'm glad I did that though because it reassured me that my "boring" way of investing was the right way for someone like me.

[@joshualupo1576]

It sounds like you’re someone who is pro holding low cost index funds in a taxable brokerage? Say VTI? 1.8% dividend yield comes from VTI so you’re still getting a tax drag? Do you have any aspirations of early retirement and if so, what are your buckets for early retirement outside of tax advantaged accounts (401k,Roth IRA)?

[@JarradMorrow]

Yes, I like VTI and VOO. I do have a couple of taxable accounts, but that's only because I max out my 401k and IRA so I need to do something with that additional money. With the money left over I utilize a taxable account through M1 Finance, Fundrise, and my savings account for the upcoming rental property I plan on purchasing.

[@joshualupo1576]

Jarrad Morrow I too max out 401k as well with Roth IRA (100%VTI in M1). I buy small multi family real estate properties which produce cash flow and self manage currently but account for prop-management in analysis. Also currently house hacking to keep COL super low. Via Robinhood, I have taxable brokerage entirely comprised of VTI and invest majority. I look at Robinhood VTI as a growth “bucket” with intent to use 4% rule and I also have about 15% of total portfolio spread out across VYM and some blue chip dividend growth stocks which currently has aggregate dividend yield of 4.23%. Plan is to grow VTI rapidly, gradually grow Dividend stocks, keep maxing out tax advantaged retirement accounts, acquire a few more units and also take my consulting work to becoming more remote. All with the goal of FI before 40

[@JarradMorrow]

Sounds like a really solid plan. How many properties do you plan to have at 40?

[@joshualupo1576]

Jarrad Morrow we’ve been on the “one property per year” plan and I’m 29. Ideally after all expenses I’d like around $150/door cash flow so 10 doors is current goal. Marrying cash flow from rentals with sizable VTI fund and much smaller basket of high yield dividend stocks will hopefully give us a solid $2,000-$,2,500/mo income stream. We will also be carrying 12-18 months of living expenses in high interest savings account to act as a buffer against prolonged market downturn. We will also have freelance income coming in consistently and won’t be tapping into passive income unless we want to step away from freelance work

[@JarradMorrow]

I’m really excited for you. Nice job so far!

[@jat1668]

I see your point. I do like the payout though.

[@JarradMorrow]

Thanks. As long as you understand what you're doing then go for it.

[@skitzothahustla]

Its very simple. Have growth stocks, and aristocrat dividend stocks or etfs. There's no garauntee on any share price and your gains aren't realized until you sell. Having dividends come in monthly is a key supplement for income. Also, in Canada we have a TFSA (tax free saving) account. All earnings are not taxable, including dividends. Makes it a little more worth it

[@JarradMorrow]

👍

[@dustindodge5974]

I'm about 75% growth, 25% value (blue chip dividend companies). I'm young but I fear growth being led by tech is overvalued so I plan to increase my growth next correction

[@JarradMorrow]

Are you still continuing to invest while you wait for the next correction or are you setting money aside in anticipation?

[@TheRemcojanssen]

You are right for an important part of a total portfolio which is smaller than 50K to which I am part of. My take on this is to always have a balance. I have over 50% in reliable dividend paying stocks, 20-30% in cyclical stocks, preferably paying dividends. 10-20 % is risk on, purely growth related stocks (in my case Tesla, Uber, Alibaba to name a few known to all). So I agree with you that ONLY dividendinvesting for small portfolio's is not the way to generate sufficient wealth longterm. But it should be part of a portfolio to stay calm when things get rougher all of a sudden. I do not think it is smart to only partake in growth stocks. If Coronavirus f.e. hits the fan, your money might be gone sooner in growth stocks than in proven-century old stocks.

[@JarradMorrow]

Great point. Balance is everything.

[@jt411]

Great video and nice quality name, one spot a little overlooked in this video is if you contribute the max to your 401k of $19500 this can lower your taxable income below the $40,000 mark thus making your dividends tax free. This a very powerful method for young investors to make tax free money while investing far more than the average person.

[@JarradMorrow]

Great tip!

[@ergkj]

Great video!

[@JarradMorrow]

Glad you enjoyed it

[@andrewnielsen8032]

I like the tax part I think alot of people forget about the taxes of there little dividends!

[@JarradMorrow]

The tax drag is an easy thing to forget about and an easy thing to just dismiss since on the surface it looks like a small %.

[@laurasonnier]

@@JarradMorrow you’re close on the taxes but a little off. 2020 tax brackets are $40,125 for single filers in the 12% tax bracket. But remember you get $12k deduction/exemption/whatever. Then there’s your HSA and retirement contributions. So truly you can make tons more money and still not get taxed on qualifying dividends. I only bring it up bc someone who didn’t know how to hack taxes may think oh, I gross $43k. Guess I HAVE to pay taxes. :)

[@mattfoley9168]

While I disagree with your investment strategy as a dividend investor myself, I found all your points very insightful and well thought out. Thanks for sharing! I'll continue to reevaluate how I invest and perfect a strategy best for my needs. #LikeAndSubscribe

[@JarradMorrow]

Thanks, I appreciate you at least hearing me out.

[@alterlivefr]

I agree with some of the things you said, but the dumbest thing you said was that if you needed money, you would just sell some of your shares.

[@JarradMorrow]

Even though you think I'm dumb, I don't think you're dumb for not knowing this. I'm sure you're pretty smart, but you just never had a reason to look at it this way. I'll give you the same example I gave someone else so you can understand that it's basic math. Jim owns 1 share of company A and 1 share of company B. Company A and B are different companies but everything about them is the exact same. From the size, earning, assets, price per share, etc. The only difference is that company A pays out a dividend and company B does not. The price per share of each is $100. Company A pays out a $2 dividend so their price per share drops to $98. Jim now owns 1 share worth $98 and he has $2 in his pocket which totals $100. Company B does not pay out a dividend so Jim still owns 1 share worth $100. If Jim sells $2 worth of his share then he has $98 still invested and $2 in his pocket which equals $100. This is why it's the same thing as selling shares. If you still don't understand then let me know.

[@matthewmackellar2460]

Jarrad Morrow but I thought the price of a stock is determined by supply and demand, not them paying a dividend.

[@zachs1192]

Value investing + dividend kings/aristocrats seems like a pretty good plan. In a Roth IRA.

[@JarradMorrow]

Depends who you ask.

[@azntoogood]

I am a growth stock investor. I made 35% gains on my overall investment in two years.

[@MRZEROTOINFINITY]

That’s where it’s at 👍

[@samuelchen5702]

I am a dividend stock investor. I made 37.7% gains on my overall investment since 2018

[@MRZEROTOINFINITY]

Samuel Chen Awesome! How’s the annualized return over the past 10 years?

[@SoHailusive]

I’m investing for long term. Won’t touch the money for another 25-30 years. Half my portfolio is a diverse blend of low cost index funds, the other half are individual stocks of dividend aristocrats. All within my Roth IRA. I also have a 401k through work. Am I being overfly diverse or sheepishly naive? I wonder.

[@JarradMorrow]

If you understand what you're investing in and know why you're doing what you're doing then you should be fine. I went into making this video with an open mind. I started out with the assumption that maybe I should be investing for dividend income. After doing hours and hours or research I came to conclusion that it doesn't make sense for someone like me.

[@SoHailusive]

Jarrad Morrow Thanks, Jarrad. Really enjoy the content and your like the only finance KZbinr that responds to my comments. Lol. Subbed.

[@JarradMorrow]

Thank you! I do my best to get to every comment I possibly can.

[@Krogzaxants]

I do a combination of dividend investing, swingtrading and daytrading. You have some great and solid points for sure! I want to grow my portfolio as fast as possible.. By dividend investing alone it take ages! Dividends are great if you have 500k+ portfolio. Below that it's not much worth it to solo focus on. But if a crash happen i sure pick up solid dividend stocks like JNJ, PEP, MCD, GPC, MMM, CLX, UN or UNA and KO.

[@JarradMorrow]

Makes sense! Thanks for sharing.

[@damemethief]

Dividend investing is great... If you're willing to put in the work. Personally, I love reading through the 10-K and 10-Q forms of various companies. I use fundamentals to guide my decision-making.

[@JarradMorrow]

This comment right here. If you're willing to do everything you just said then you're probably better off than the vast majority of dividend investors out there. I highly doubt most of them are digging into the details as much as you are. I'd hope they are, but I'd assume you're an outlier.

[@976isma]

Some companies will still growing and pay nice dividends..

[@JarradMorrow]

Agreed

[@Shawk95]

The title could have been:"When it makes sense to invest in dividend-paying stocks?" but the current title is probably more sexy.

[@JarradMorrow]

There's many ways to go with titles.

[@Stormy_Dawn]

No matter what he says its still gonna be sexy.

[@Shawk95]

@@Stormy_Dawn Please pardon my frankness but I seriously doubt you have understood what 'sexy' means in the context of this discussion unless you are being funny or cute.

[@Stormy_Dawn]

@@Shawk95 I was 100% being funny. Haha

[@MrLaonation]

He did it to get views lol good move fore his passive KZbin income

[@tim4505]

I don't agree exactly. But I like you, subscribed

[@JarradMorrow]

Thanks, I appreciate it 👍🏻

[@ImDaveMatthews]

maybe by dividend income investing im not looking for an immediate passive income stream. By utilizing DRIP and identifying undervalued companies it can allow you to grow a pretty sizable portfolio, and in turn a pretty sizable passive income stream by the time you retire - be it one, two, three plus decades down the road

[@JarradMorrow]

How do you pick undervalued stocks? Is the success rate pretty high? Sounds pretty easy.

[@jackharper8370]

Interesting. I like the point and counter points. Good videos you and TruFinancials did. So I'm mid 40s and after a divorce finalized 7 years ago I am just now getting back to a place where I have some disposable income to invest in the last year. It's not all bad I didn't come out too badly, but most of my investments are held in tax advantaged accounts. And I max those out as I can, but I'm looking into after tax type possible investments now. Been researching strategies. I'm of the opinion that as you get older it may be advantageous to move towards a dividend portfolio especially in tax advantaged accounts. Younger seems you should be focused on growth. Since I'm now middle-aged that puts me at a crossroads.

[@JarradMorrow]

Thanks! Might make sense to hold off on a dividend heavy portfolio until you need that money. It's up to you though.

[@beckaldan]

you just got a thumbs up!

[@JarradMorrow]

Thanks!

[@MRZEROTOINFINITY]

Totally agree with you Jarrad. I made a video on this awhile back. The dividend stock loyalists are out in force here on KZbin! Growth stocks are the way to go if you want to grow your wealth sooner rather than later. If you already have $500k, then sure - dividend invest. 👍

[@snowelth]

The one thing I know about growth stocks is they go down a lot quicker than they go up. The problem is you have to know when to sell to make a profit. Take GE for example at one point they went to the moon in share price back in 2000 the price reached nearly 60 dollars a share! Now GE sits under 13 dollars a share.

[@MRZEROTOINFINITY]

@@snowelth In my opinion, as long as the growth story remains intact, you don't necessarily have to sell. Growth stocks are my bread and butter.

[@JarradMorrow]

How do you know when the right time is to sell? Does it have to be up a certain % or do you just go off of "feeling"? Sounds to me like you're trying to time the market.

[@MRZEROTOINFINITY]

@@JarradMorrow I've held on to a lot of my positions from the early 2010's. I don't sell unless there are major issues with the current business model or if growth has stagnated for multiple quarters. My short-term holdings follow a different story.

[@Miossoty1]

"my poor little dividend" LOLOLOL

[@JarradMorrow]

:)

[@LarfleezeOrangestein]

I use dividend gains to purchase pure growth stocks. 🤔

[@JarradMorrow]

If it works for you then that's great

[@nl.1708]

All I see is common sense reasoning here, are the dislikes all from drones easily influenced by KZbinrs?

[@JarradMorrow]

Haha well not everyone is interested in understanding all of the pros as well as the cons.

[@kas06chi18]

Guys it’s just a different viewpoint. The only wrong way is investing with no research. DO YOUR OWN RESEARCH. It’s easy to get caught up with “I made $800 in passive income buying dividend stocks” titles. He’s giving you some of the cons to it. He made valid points especially with TAXES! Watch the video with an open mind and willingness to learn, don’t take it as a personal “attack.” You can learn something from everyone.

[@JarradMorrow]

Thanks for understanding the point I was trying to get across.

[@GoYaking]

I highly highly recommend you read get rich with dividend. Maybe it’ll change your mind. There certain criteria to follow just like everything else, you stick with it and it might work out for you.

[@JarradMorrow]

Thanks for the recommendation. I just found it on Amazon so I’ll check it out.

[@GoYaking]

Jarrad Morrow not a problem. All your reasons are answered inside that book. Including thing like tax, growth, and what to do when it all goes it crap. GE is an exception, but if you follow the process, you would had sold it as soon as the dividend either stop or cut. Remember one thing, in a bear market, everything fall including dividend stocks so nothing will really weather your portfolio during those time. However, if you’re a true dividend investor, you will want it all to fall so you can cost avg down on the cheap. I wish I discovered that book before started in the market back in 06. Good luck.

[@JarradMorrow]

I appreciate it. The stock picking part is one of my biggest hang ups. It’s very difficult to do successfully and dividend investing the right way takes a lot of work. I do my best to stay open minded so I’m willing to give this book a read to gather even more information.

[@coolguy-ze1gs]

dont use dividends as the sole indicator of purchasing a stock, thats it xD

[@JarradMorrow]

I agree

[@intrepid35sweden]

Okay, i know you obviously don't know what you are talking about after hearing what you say about the dividend yield at 7:20 and that somehow being a reason for dividend reliant investors being in for a "surprise". Dividend yield is subject to market fluctuations and doesn't mean the dividend change...

[@JarradMorrow]

You're telling me you wouldn't be surprised if your dividend yield for GE dropped by 2% within a year?

[@intrepid35sweden]

@@JarradMorrow Sorry, my first comment was a bit blunt. What I meant is that the current yield has zero effect on your dividend. The yield is the current yearly dividend over the price. The dividend is purely decided by the company and its fundamentals while the price is subject to the market which is highly emotional and dramatic. The principal may take a hit but the dividend wont most of the time.

[@thedollarbox-masterthemone5625]

Always spread out your investment portfolio... don’t put your eggs in one basket

[@JarradMorrow]

Very true!

[@Miossoty1]

Yep. COVID cut them dividends from the Deposit-taking Institutions here in JA. Sell-off galore.

[@JarradMorrow]

It's rough

[@stefansly1990]

I just go for both dividends and growth. Buy the dividend company at a low that way it grows while paying you.

[@JarradMorrow]

A mixture sounds like a good idea

[@nguyennnn01]

Say dividend around 4%/year. Means I let 100k sit for 1 year I will only get 4k/year. Am I correct?

[@JarradMorrow]

Yes

[@Kibatsume1]

My dividend stocks are up 30% for the year, That is 30% without the dividend factored in. With that said all my dividend stocks are in my roth IRA.. While I am currently in a good position to max out my account,There are circumstances in the next 2 years That will make it a bit of a struggle. having dividends to help purchase more shares is a nice way to Insure my Roth does not suffer too badly if I cannot Max it. . Especially now that we have zero commission , I can put those diveneds where I want them..:

[@JarradMorrow]

Awesome!

[@blinddog4288]

When I saw the title I wanted to immediately give it thumbs down, but I listened to it and changed my mind. Good video!

[@JarradMorrow]

I appreciate you giving it a chance even if you didn't initially agree with it. We all become a little better when we listen to opposing views to hear a different perspective.

[@blinddog4288]

Jarrad Morrow Amen!

[@snowelth]

" receiving a dividend is the exact same thing as selling off shares of a company for the exact same amount." Odd my share count doesn't seem to go down when I get a dividend from a company like Johnson and Johnson, yet it does go down when I sell off a stock like Facebook. What if a person reinvest the dividend wouldn't they get more shares of the company?

[@JarradMorrow]

The share price does reduce by the dividend paid. Watch that part of the video again and I explain why. It’s basic math. Yes, reinvesting the dividend of course buys you more shares, but a dividend isn’t like free money. It’s just a way for the company to share some of their profits with shareholders.

[@snowelth]

@@JarradMorrow Thank You for the reply. Yes a dividend is paid out from the companies free cash flow ( unless they take on debt or sale off assets) to me it's a reward for shareholders.

[@JarradMorrow]

That's fine, you can call it a reward. But the price per share is reduced by the same amount of the dividend paid because the value of the company goes down.

[@ImDaveMatthews]

@@JarradMorrow which in turn is a positive because my reinvested dividends would go towards more shares, thus increasing my pay again for the next quarter. If you're able to identify values in your dividend stock picks these small fractional fluctuations around ex-div won't matter in the long run

[@roveirdatu3851]

Yeah I’m also lost on this one. I know the stock price goes down when the company pays out dividend, but it’s temporary. If the company is a solid, sound company I don’t see a reason why it’ll stay down. Also dividend is free money. It’s actually money that goes into your account/ reinvestment.

[@andrewnielsen8032]

You can't unpoop your pants!!!

[@JarradMorrow]

Haha one of his better quotes.

[@sm4sher45]

I-I did it!!! I have unshitten my PANTS!!! *ascends in to godhood*

[@andreitravkin5155]

Great video. I don't know why people get offended by this, it's just like being offended by math

[@JarradMorrow]

Haha thanks for the laugh.

[@976isma]

Bets thing is have 50%in dividend portfolio reinvesting and the rest in short term multiplying

[@JarradMorrow]

Interesting

[@976isma]

Oh I see more now apologies hard for me to understand fast oral English yes you are right if you just follow people investing without knowing by yourself you'll be always loose money and that's what a lot of people do the same way they can't do nice interpretations of geopolitics manipulations and impacts on market, they want to invest long term in things they use. But today the market doesn't look for what consumers want anymore, they just decide what the consumers will use :) and the ones who doesn't understand that market is manipulated always loose money. It have to be manipulated to renew economy. Most crisis and big bears are created otherwise sp500 would be like 10000$ and nonsense on market. I'm not cornucopian.

[@arcaneknight9799]

What about ETFs for passive income?

[@JarradMorrow]

It all depends which ETF. I personally own VTI and VOO.

[@arcaneknight9799]

@@JarradMorrow I know you're probably going to recommend placing these in a tax-advantaged retirement account, right?

[@JarradMorrow]

My thought is that you should always be maxing out a retirement account before even thinking about investing in a taxable account.

[@arcaneknight9799]

@@JarradMorrow I have $1000 already in my Roth IRA for this year: VTI 85%, VXUS 10%, BND 5%.

[@JarradMorrow]

$1,000 of your $6,000 by now is a really good start. Just continue until you max it out. After that then look towards using a taxable account, unless you have access to a 401k

[@emmanuelbarrientos1430]

I just turned 19 and I’m still in school but I want to be able to buy a house in the next couple years. I want to be able to receive income so that I’ll be able to pay the house along with receiving income from a part time job. I was thinking about dividend investing but after this video I’m lost? Any help that you can give ? I just want to make the best posible decision.

[@ZachdotMiller]

Dividend investing for passive income, that you will use instead of reinvesting it all, takes a LONG time to ramp up and get started. All the work is done up front with little reward and then its an exponential growth that works amazingly in the long run. In your sitaution it sounds like you need more income now and dividend investing wont do that for you unless you have a large sum of money to put in the market right now (im talking at least $40,000 to $60,000) you should probably focus on increasing income/furthering your career and staying out of or getting out of debt.

[@ZachdotMiller]

Investing for passive income to pay off debt and home loans isnt a very good idea because its not enough return fast enough. I would just put around $50 to $300 a month into your ROTH thats invested in ETF's or dividend stocks where u re invest everything. Then put the rest of your money into paying for school.

[@emmanuelbarrientos1430]

Zach Miller I do plan on investing in Roth IRA in the long run but currently I’m not in debt. I planned on building my dividends invest now so that when I rack up 40-60k I’ll be able to buy a house early on. With the portion of money I’ll have saved up for the house. I just don’t see a way to “increasing my income”. I am just working part time. I don’t have a business or any type of career yet. How do you increase your income ?

[@emmanuelbarrientos1430]

Zach Miller I won’t be using the dividend money right away. I would be reinvesting it also

[@ZachdotMiller]

I would check out Joseph Carlsons YT channel. You'll get a good sense of how much money you get from dividend (dividend growth) investing based on how much you have in the market. You can also email him your questions and he replies to most of them in his vids. That might take a month or so to get answered but he is very knowledgable on this stuff so probably worth doing. Depending on how many years out you want to buy a house I have a hard time seeing dividend investing helping you pay for its down payment or helping with saving up for the down payment but either way its a competitive long term investment strategy that is worth fully understanding and learning about to see if its a good fit for you now or later in life. Also its usually better to have a home mortgage as your only debt or majority of your debt rather then school loans. So you should probably be prioritzing your money towards paying for school. Often times its hard to buy a descent house anytime soon after school but of course it all depends on how much if any college debt you have when graduating and what kind of paying job you get for your first couple years.

[@gamingguru2k6]

If I wasn't an open minded dividend investor, then I wouldn't look up videos like this. It's easier for me to feel comfortable investing this way, even with a lower return. I like that dividends can always help me grow my positions at a constant rate, even if I can't put money into the market. Considering I started investing on march 17, I've always been in the green so far. I'm waiting for that second crash, but dollar cost averaging the whole way.

[@kankerdoodleb9149]

I dabbled with dividend investing long enough to realize I'm not that interested in the market, so it was back to my Vanguard accounts and...done!

[@JarradMorrow]

At least you gave it a try.

[@joshualupo1576]

Jarrad Morrow VYM is conveniently a Vanguard ETF that conveniently invests in..you guessed it..High dividend yielding companies. As passive as it gets and spits off a 3.07% yield.

[@JarradMorrow]

Nice!

[@HiddenFreedom]

You can't un poop your pants, just like you can't fix stupid. I think for me, FIRE'ing soon, dividends will work great. I'll keep earned income below the 12K which will keep my dividends tax free below the 40K limit. If for some reason my dividend income gets beyond the limit, I'll get married and double in standard deduction and qualified dividend income limit for tax free or I'll dump some into VTI or VOO. Great video.

[@JarradMorrow]

I'm glad you've actually thought it through instead of mindlessly investing this way "just because". Do you have a woman picked out that's just going to marry you real quick so you can double the standard deduction? Haha she might not be happy just waiting around for your dividends.

[@HiddenFreedom]

@@JarradMorrow Sadly, no. Ha.

[@JarradMorrow]

Haha :)

[@jasonkirkcaldy7463]

I agree the avg Joe cannot pick dividend or growth stocks and beat the market. You’re philosophy on dividend stocks is fundamentally flawed. Over 2 years I’m outperforming the SP500 and my portfolio grows divs at an avg CAGR of 11%. I invest for future income not portfolio value. Once I buy a dividend stock in a fundamentally sound company it’s a sunken cost.

[@JarradMorrow]

How are the points I made flawed?

[@jasonkirkcaldy7463]

Jarrad Morrow A company who increases earnings and then increases its dividend effectively is paying me more and more over time which increases my YOC. To make money off growth stocks you need to sell the stocks and pay the tax rate. I prefer to make sound purchases in dividend stocks that are under/fairly valued and are growing the dividend consistently. In a recession I would argue that an overvalued growth portfolio would suffer greatly compared to a fairly valued dividend growth portfolio generally speaking. And Ill reinvest my dividends further compounding my gains. You paint the picture that because they pay a dividend the stock price will go down. Sure it will on payout dates but if the company is increasing earnings and revenues it will increase in price over time in an efficient market.

[@JarradMorrow]

If dividend investing works for you and you're doing your due diligence to pick stocks based on your strategy then keep doing it. I can't fault you for that. At the end of the day, I'm just glad you're investing. Thanks for sharing your points of view.

[@jasonkirkcaldy7463]

Jarrad Morrow To add to my point... As a growth investor you need to be more on top of your portfolio than a dividend investor. My reasoning is that as a growth investor you only make money if you sell higher than you bought. In a volatile market you need to be on top of all your positions. As a dividend growth investor my portfolio is on autopilot. I never worry about the price of the stock. I just keep an eye on the fundamentals of the company.

[@JarradMorrow]

I understand. My investments are pretty much on autopilot as well. I invest in index funds and leave it at that. When I get closer to retirement it may make sense for me to move some of my overall portfolio into a few dividend paying stocks, but right now it doesn't make sense for me personally. This strategy fits my investing style perfectly.

[@NerdJourneys]

your video aged well!

[@JarradMorrow]

Thanks!

[@QuesttoFIRE]

Lol wooooow the level of dislikes on the video!!!🤣😂 Did Denis sabotage your channel?!? I’m primarily an index investor, but I do have a dividend portfolio I’m working on as well. 👍🏻📈🔥🔥

[@JarradMorrow]

This is one of those topics that I expected quite a few dislikes so that's okay :)

[@dustindodge5974]

I'm the same way. I feel most people watching KZbin dividend videos don't fully understand dividend investing and the taxable income

[@JarradMorrow]

I agree with you, Dustin. If you fully understand it and still want to do it then there's nothing wrong with that. Unfortunately I don't think that's the case with a large % of viewers.

[@bmmk12]

We all have our different Investment Philosophies. We all have different risk tolerances and time horizons. We all have unique financial realities, goals and landscapes. We all have different amounts of time we can commit to the work of investing. Some find the research and hunt for stocks exhilarating, others, loathsome. The point of investing is that you do it! It ought to be enjoyable, and something that is contributing to your personal goals and is aligned with your values. What and How and Where is irrelevant in the end - as long as you are true to yourself and investing so as to meet your goals, then go for it! Videos dismissing strategies for content sake is rather pointless.

[@JarradMorrow]

Well said.

[@BellTunnel]

I love the idea of dividend income investing, but I’ve made many, many times more with traditional growth stocks (AMZN, AAPL, MSFT) than I have high yield REITs and MLPs.

[@JarradMorrow]

Some people want to live off those dividends so I understand why they use that strategy.

[@Gazziza29]

Thank you for this video, I completely agree. I've seen a bunch of dividend investing videos pop up on YT finance "experts" lately. IMO it's a fallacy that goes hand in hand with "passive income" and FIRE movement folks. For whatever reason young millennial investors are enamored with the idea of passive income and FIRE. They think that they can live off of "passive income" the rest of their lives. First things first, passive income is not passive. You got to make money to to invest in the dividend stocks, so thereby it was not passive in the first place since you had to work to invest it. Second, dividend investing is essentially sacrificing your future to make a few bucks today. When you're young and you can let the money grow with compound interest why take out the dividend for an early payout? That couple of dollars today could have been hundreds of thousands of dollars when you're 65. Third, I see a lot of these guys posting the composition of their dividend portfolio's, what it's comprised of, how much time and effort it took to select a few dividend paying stocks all for a $50 a month and maybe a few hundred a year? Simply not worth my time nor effort. I can invest that time in either working one extra shift, doing something else to make money, or simply relax. Fourth, it's no guarantee that you will keep earning the same amount of dividends as time goes on. The payouts could be more/less and as you said it's no different than picking stocks. There's no telling what your monthly take home from the dividends will be. If these people are going to become reliant on their dividends for monthly income and believe they'll retire at 30 I think they're going to be in for a rude awakening. And lastly, the only people I hear dividend investing is from guys with KZbin financial degrees. I don't know of any certified CPA, CFA's hyping up dividend investing. People need to be a little more critical in who they listen to and trust with financial advice. Because the irony of it all is that all the Dividend Investing KZbinrs and FIRE starters are making money through views, ads, clickbait, and subs by selling a false dreams that people fall for.

[@JarradMorrow]

Thanks. Yes, dividend investing is a lot more complicated than it's made out to be. I'm a big proponent of FIRE, but not using dividends as the main source of income.

[@Gazziza29]

Jarrad Morrow Agree brother. I’m a proponent of FIRE too, if you can do it all the more power to you. I just feel like a lot of novice investors (and I am one) fall for the sexy trap of Dividend Investing and think that’s their way to FIRE. For one, to be a FIRE starter you have to have a TON of capital, time investing, and a particular niche, speciality, and skill to do so. So that means you have to either own your own business, be a real estate investor, and be marketable. All of which again requires capital and a skill. Likewise the only way dividend investing works is if you have a TON of capital. It’s not going to work if all you make is a few measly hundred dollars a year. And lets say your dividend is at 3% annual you need to have at least $500k in a dividend portfolio for it to make a drop in the bucket. So then it comes back to having that capital. The only way you do that is to be a professional at something and make money. I think people should focus on obtaining skills and a career before focusing on FIRE. Once you have the job and the capital then it can become a reality. I’m not trying to be a naysayer but realistically speaking people need to pump the brakes on retiring at 30 and living off dividends for 50+ years.

[@akin242002]

I agree with this video. Dividend investing is usually treated as an extension of a saving account after emergency funds. However, individual non-blue chip stocks are horrible in bulk. Dividend ETFs are far better because they do the work for you in terms of picking stocks. VYM and SCHD are great ETFs for dividends in taxable accounts.

[@JarradMorrow]

Good points. Thanks for sharing.

[@sonny12681]

You will like dividend investing after you read my comment. Only invest in a dividend paying stock if the stock is a ETF, mutual fund, closed end fund or a bond that pays the dividends monthly instead of quarterly. With my dividend investing strategy, I don't buy stocks in individual companies. ETFs, mutual fund, closed end funds and bonds are not an individual company but a group of many companies. I love dividends because I want my money now. I dislike growth stocks because your not worth that money until you sell.

[@JarradMorrow]

👍🏻

[@kei1818]

ya but dividend biased indexes

[@JarradMorrow]

Okay

[@jeanpolice3044]

Then I am Lucky to live in Canada. In TSFA accounts dividends are tax free. In USA, it's different.. Of course I don't have much money yet to live from that. I am far away 😂

[@JarradMorrow]

Dividends are tax free in the US as well if it's in a Roth IRA.

[@jeanpolice3044]

@@JarradMorrow Yes that's what I realised. Anyway USA stocks growth destroy dividends growth !! Mixing these two would just be awesome !! When I'll have more to invest, I'll destroy my own limits not the market !! ⭐ 💪💪

[@AndyNick211]

Totally agree. I can understand going full dividend investing when you reach $2mil+ to take advantage of “safe” compounding, but there’s so many KZbinrs in their 20s missing out on massive growth by throwing all their money into stocks that always lag the market

[@JarradMorrow]

Dividend investing videos get views so they’ll keep making them.

[@colinevewright]

The points made about the effect on stock price of going ex-dividend are correct and basic maths. Companies that reinvest profits still benefit from compound interest but should gain even more as the growth is likely to higher by reinvesting in a growth business. While dividends are one strategy (and I have dividend stocks as well as growth stocks), it is often used by investors as it gives them emotional comfort. If you need the cash flows during retirement, then increase your dividend stocks near to retirement, or even just sell some shares every year. So instead of relying on a 2% divi, sell 2% of the shares annually. The only real benefit of dividend investing is that the companies' share/stock prices are more stable (both up and down) so are better suited to people who don't want the higher risk of growth companies and higher price fluctuations. So it comes down to whether you want to invest in younger growing companies or older more mature companies.

[@JarradMorrow]

Thanks for sharing your thoughts 👍🏻

[@InvestingWisely]

Personally I like stocks that provide dividends, solid chance for appreciation and growth. Ie I would rather own Home Depot than AT&T

[@InvestingWisely]

GrowsInHouse Herbicultural Innovations, LLC yes and has a 5 year annualized return of 3.2%

[@JarradMorrow]

If it works for your investing style then keep doing it

[@InvestingWisely]

GrowsInHouse Herbicultural Innovations, LLC while HD has a 17% 5 year annualized return and a 2.35% yield. Net net Home Depot’s annual yield is almost equal to AT&T total annual return...

[@InvestingWisely]

GrowsInHouse Herbicultural Innovations, LLC Yield on cost is a feel good metric. Total return is what matters. Yield on cost ignores taxes, inflation, time elapsed since purchase, and total return. Don’t get me wrong I love dividends but not at the expense of total return

[@InvestingWisely]

GrowsInHouse Herbicultural Innovations, LLC how?

[@bawireman]

You're entitled to your own opinion, but you're doing a disservice to your viewers. I'll be happy to retire at 50 and live off my "dumb" dividend investments. I'll also be happy when I die knowing that my kids will never have to work once the portfolio goes to them. But you do you buddy.

[@JarradMorrow]

How am I doing a disservice to my viewers by showing them a different perspective? I even went as far as linking up a pro dividend investing video from one of my friends that prefers this way of investing. I prefer to teach people how to be more open minded and question things instead of immediately shutting down opposing views. Thanks for sharing your point of view.

[@bawireman]

@@JarradMorrow I came off a little strong. I get it, but I think my mindset just differs from yours. But, I'm probably a few years older than you and also have four children, so my perspective and longtime goals may differ than yours. I respect your opinions.

[@JarradMorrow]

Don't worry about it. I honestly wasn't expecting much love from this video to begin with :). Good point- our individual circumstances are different which absolutely plays a role in how we view this type of strategy. Thanks again for sharing your thoughts.

[@Simon-je7ko]

It's a source of income. For me I do not want to enjoy life when I am 65. I want it now. I am not talking about buying a brand new Ferrari or an Ashton Martin or living in Monaco. But dreams are cheap! I do not want to work anymore on the week-end. Enough! Five days a week is more than enough. Maybe too much already. You get the point. You are going to earn more with dividend stocks than at your local bank. Where interest are made with way to much zero. You could buy an index like VYM for dividends. But with stocks you are to make much more money or return. If there is a dividend with a stock. The dividend pays itself after 10-15 years. Yes you can beat the SPY. If you do not have credit cards you already do it! Also any dividend or return pays more than the morronic interest from your bank. Just learn! Good luck!

[@js5072]

Disagree, the value of the company is based on assets plus interest of the investor. Dividends usually keep investors interested which makes the value go up. If you don't get dividends from a company, the stock ownership is nearly worthless because you are banking on someone else wanting the stock more than you.

[@JarradMorrow]

The value of a stock is based on way more than just assets, interest of investors, and dividends. Apple didn’t pay out a dividend for years. According to your logic their stock price shouldn’t have gone up in the past. Amazon doesn’t pay a dividend yet their stock price has grown. Are you telling me Amazons stock is worthless right now because they don’t offer a dividend? Based on the words you wrote I can tell there’s a lot you don’t understand about the stock market. I suggest you go study up a little bit because you don’t know what you’re talking about and it could be costing you money.

[@dsanti4069]

Jarrad Morrow people bought Apple before the dividend was announced because of speculation and Stanley is correct. The only reason someone buy a non dividend stock like Tesla is because they believe more people will want that share in the future . Stocks essentially are only worth what the last person paid for it

[@JarradMorrow]

And there's buyers out there for Tesla so it's not worthless. But based on what he said, Tesla stock is worthless since they don't pay a dividend.

[@KurikuShoTto]

Whenever a KZbinr touts the greatness of Dividend Income, I immediately question their knowledge and click off

[@JarradMorrow]

😂😂

[@atableinthewilderness680]

I have argued with dividend strategists who post videos explaining how they work. They almost never include the fact that the payout is drawn from the share price. I still don't know if that is because they're lying or they simply don't know.

[@JarradMorrow]

I believe that it's because they simply don't understand.

[@976isma]

you just needed to do an antithesis

[@JarradMorrow]

I wanted to give the perspective of someone who isn't stock picking for dividend income. If someone understands what they're doing and still wants to do it then I don't have any problems with that. My concern is that the average person sees all of these pro dividend investing videos and thinks they should blindly do it. I'm not blaming the people who make these videos because I would hope they've done their research.

[@976isma]

Sorry bro.. I was the hater here but honestly it's a safe way to buy stocks, even if the stock you bought went down you still have an income without closing in negative and loosing money, it's just the best way to buy stocks and the safest. Now I know there are some faster investments of course(I've a 5%/month one actually believe or not, 2 years regular) but it still. Way to diversify investments, the short terms investment can be risky if you are not sure 100%where you putting money. As crazy Einstein said :all is relative...

[@976isma]

Oh I see more now apologies hard for me to understand fast oral English yes you are right if you just follow people investing without knowing by yourself you'll be always loose money and that's what a lot of people do the same way they can't do nice interpretations of geopolitics manipulations and impacts on market, they want to invest long term in things they use. But today the market doesn't look for what consumers want anymore, they just decide what the consumers will use :) and the ones who doesn't understand that market is manipulated always loose money. It have to be manipulated to renew economy. Most crisis and big bears are created otherwise sp500 would be like 10000$ and nonsense on market. I'm not cornucopian.

[@ronnix23]

I don't think I could do better than an index on my own which is why I subscribe to The Motley Fool. Thanks to their picks I've been clobbering the S&P.

[@JarradMorrow]

Nice job! Is it a paid subscription?

[@ronnix23]

@@JarradMorrow Yes it is. Right now the price I pay would be .04 expressed as an expense ratio. Of course sense it's a flat fee the expense ratio gets lower as my portfolio grows.

[@JarradMorrow]

If it works for you then that's great!

[@kei1818]

tax free dividend stock!

[@JarradMorrow]

Yea!

[@moefraz4216]

Stock market is too slow I’ll stick to cash flow from apartment buildings

[@JarradMorrow]

I like that strategy a lot.

[@dsanti4069]

This is dumbest video I seen on dividend investing . Dividend investing is like buying a house that pays you rent regardless what the housing market is at . You don’t need to sell the roof or parts of the house to make money . Investing in value stocks is the opposite . It’s great for short term gain but dividend investing is geared towards passive income !

[@JarradMorrow]

😂 I'm honored to be the creator of the "dumbest video" in your opinion. Seriously, thank you so much :). Have a great day!

[@florent2467]

Before insulting people, you really need to start learning some math... Im gonna open your eyes a bit and then you can apologies (oh and sorry in avanced, I am going to break your dream of dividend being free money) Let say you have 20 Coca Cola stocks at $50 a stock. So you have $1000 invested. Let’s say on march 1st is the ex-dividend date and the quartely dividend are $1. Then on march 2nd, Coca Cola stock will open at $49! You won’t see a stock fluctuation of -2%. It’s be a fluctuation of 0%. That’s how is works. So new your investment is worth $1000-$20 (2%) = $980 You decide to reinvest dividend? Great! You can use your $20 dividend to buy 0.4 share. Your investment is new valued... $1000! (More like $996 is you keep some for the tax you now owe) Now let say coca cola stop paying dividend. The stock is worth $50, you have 20 of them so $1000. You don’t get dividend, so you don’t reinvest anything and your portefolio is worth... $1000! And you didn’t have to pay any tax and you can decide to sell your 4% of shares whenever you want and not every quarter or month. By selling you dillute the quantity of stocks you own. By getting dividend you dillute the price of the share. Portefolio = nb of shares X price of the ahare. No matter which variable you reduce by 2%, the result is the same => portefolio loses 2% of its value. Looking at the comments it seems that 99% of the investors are confused by simple math. Scary

[@RockTheCage55]

Oh boy. I don't even know how to start responding to this but i'll try. Is there a lot of people that are doing DGI wrong...HECK YES. I see it every day even on some of these youtube videos. They buy dividend aristocrats/champs/kings no matter what the valuations & make bad choices. Perfect examples currently would be MCD, DIS, V, JNJ, O, ECL. While all of these companies are awesome companies they are WAY overvalued. I don't know how else to put this but some of the statements you make your talking out your rear end "Receiving a dividend is the exact same thing as selling off shares of a company worth the exact same amount". That is hogwash. They are totally different. First of all most DGI investors DRIP so then end up owning more or a company rather than less. This also lowers your cost bases so over time your are earning more on your invested capital rather than less. When you selling company x and you have less ownership in whatever company how in the world could that even compare? Can i compete with those companies who have 100s or 1000s of employees? Yes i can and i have. So Warren Buffett doesn't have all those people or data & doesn't really know how to use a computer that well yet he has beat companies with 1000s of people in the long term. I started investing this way in late 98 (before it was popular) and i have beat the S&P ever since. How? Oh for so so many reasons. I don't have management breathing down my neck because i have under performed the index in a quarter/year ect. I'm looking for 3-5 year performance not a quarters performance. Being a small investor i don't have to worry about liquidity issues. Your right a company can dump its dividend at any time. There is always a risk of that but if your a smart investor there will be warning signs. How about dividend coverage ratio? If your dividend coverage ratio is 98% and company has been raising its dividend every hear by 5%. I was in both GE (early on) & OMI and was able to get out way before they dropped their dividend. Another perfect example would be BA. They just took a loan to pay their dividend (no thanks goodbye) or i noticed HD was taking on debt to pay theirs. HD could afford to pay their dividend from FCF but interest rates were so low they found it advantageous to talk low interest loans to pay theirs. To me its a management issue and what happens with interest rates go up some day? Your logic in saying you shouldn't invest in companies for dividends is like saying you shouldn't drive a car because you know someone that died in a car crash. Honestly you seem like one of those EMT zealots and thats fine all but your spewing a bunch of false information. Picking stock is timing the market? HUH!?!?! Where did you come up with that one? Timing the market would be looking at macro picture and deciding to invest or not invest depending on the macro picture. I pick stocks and i don't care what the macro factors are if its undervalued i buy it. That simple. I do agree with you that initially you need to spend a lot of time to know how to valuation companies (and its not easy at first). But i spend at most a couple of hours a week now. Another thing. You absolutely will not pay takes on your dividends when you DRIP in a general non-taxable account. That is totally wrong There are small exceptions with your dealing with MLPs & have to deal with K-1s because dividends are considered to be a distribution but otherwise you will NOT be taxed until you retire and start to take the dividends out rather than DRIPPING them. So yes people with robinhood accounts are being taxed on their dividends currently because they do not offer DRIP (though the are supposed to soon).

[@florent2467]

@RockTheCage55 it’s not free money at all. Let say you have 20 Coca Cola stocks at $50 a stock. So you have $1000 invested. Let’s say on march 1st is the ex-dividend date and the quartely dividend are $1. Then on march 2nd, Coca Cola stock will open at $49! You won’t see a stock fluctuation of -2%. It’s be a fluctuation of 0%. That’s how is works. So new your investment is worth $1000-$20 (2%) = $980 You decide to reinvest dividend? Great! You can use your $20 dividend to buy 0.4 share. Your investment is new valued... $1000! Now let say coca cola stop paying dividend. The stock is worth $50, you have 20 of them so $1000. You don’t get dividend, so you don’t reinvest anything and your portefolio is worth... $1000! And you didn’t have to pay any tax and you can decide to sell your 4% of shares whenever you want and not every quarter or month. By selling you dillute the quantity of stocks you own. By getting dividend you dillute the price of the share. Portefolio = nb of shares X price of the ahare. No matter which variable you reduce by 2%, the result is the same => portefolio loses 2% of its value. Looking at the comments it seems that 99% of the investors are confused by simple math. Scary

[@RobFrank22]

ETFs charge fees

[@JarradMorrow]

Correct, some have expense ratios. What’s your point?

[@RobFrank22]

@@JarradMorrow when a dividend stock goes up, you're getting a piece of the gain.

[@JarradMorrow]

When anything traded on the stock market goes up you get a piece of the gains. Non dividend paying stocks you can sell as much as you want to receive some of the gains. With dividend paying stocks you receive a dividend for some of the company’s profits and you can also sell shares to profit from the gains. What does that have to do with ETF expense ratios though?

[@RobFrank22]

@@JarradMorrow nothing, sorry

[@RobFrank22]

@@JarradMorrow seems like etfs are for people who dont want to set up their own portfolio