How many expats are living from dividend stocks?

[Coota]

I am a self funded retiree, I live off my superannuation income stream which can fluctuate year to year.  I recently received an inheritance and have invested about 80% of it in Blue Chip Australian shares that will give me dividends to supplement my income stream. The rest of my inheritance I keep in cash in the bank but dabble in small cap stocks that can grow in value very quickly, I then sell them at their peak and buy other small company shares.  I subscribe to an advisory company that researches the companies and then recommend them.  It costs about $100AU per year to subscribe and I have got that back in the first 2 weeks of my subscription.

[vukovar77]

22 hours ago, tubby johnson said:

I do.

 

Dividend growth stocks: the dividend rises every year.

I reinvest some of the earnings and transfer what I need to my Thai bank account.

It is very hard to live only from dividend.When you take dividend ,stock fall mostly at same amount.You can do it only if You have very big portfolio and many REIT-s with good performance.

I trade about 25 years every day and I can not say that I can live only from dividend yield.An contrary my profit is mostly from capital gain,not dividend.

[Pinot]

I'm an American who lives off 50% Social Security and dividend income. Dividends are generated from CEFs, paying in the range of 6-12%. I own no stocks and won't ever buy any single stocks, simply too risky from say a "Black Swan" event and no one can pick individual stocks and beat the market. 

 

CEFs use leverage to generate higher returns. I have considerably more money now than when I arrived in LOS 10 years ago despite living off the dividends. The CEFs I own also appreciate in value. I own about 15 of them. I'll give you my top five to give you an idea and then you can do your own research at Cefconnect.com

 

ETY, ETJ, CHY, UTF, HYB

 

I'm surprised the subject was opened and I'm the only one doing this. I've never made less than 12% a year and get paid dividends monthly. I think of it as the "Income Factory" approach. 

 

If you have questions you can message me. It's an easy way to generate money. If you're sitting in cash, you're losing. Real estate is a pain in the neck, ties up your money and you need someone running it for you. 

 

My 2 cents.

[vukovar77]

1 hour ago, Coota said:

I am a self funded retiree, I live off my superannuation income stream which can fluctuate year to year.  I recently received an inheritance and have invested about 80% of it in Blue Chip Australian shares that will give me dividends to supplement my income stream. The rest of my inheritance I keep in cash in the bank but dabble in small cap stocks that can grow in value very quickly, I then sell them at their peak and buy other small company shares.  I subscribe to an advisory company that researches the companies and then recommend them.  It costs about $100AU per year to subscribe and I have got that back in the first 2 weeks of my subscription.

I think this is not true.Nobody should believe that.

[vukovar77]

4 minutes ago, Pinot said:

I'm an American who lives off 50% Social Security and dividend income. Dividends are generated from CEFs, paying in the range of 6-12%. I own no stocks and won't ever buy any single stocks, simply too risky from say a "Black Swan" event and no one can pick individual stocks and beat the market. 

 

CEFs use leverage to generate higher returns. I have considerably more money now than when I arrived in LOS 10 years ago despite living off the dividends. The CEFs I own also appreciate in value. I own about 15 of them. I'll give you my top five to give you an idea and then you can do your own research at Cefconnect.com

 

ETY, ETJ, CHY, UTF, HYB

 

I'm surprised the subject was opened and I'm the only one doing this. I've never made less than 12% a year and get paid dividends monthly. I think of it as the "Income Factory" approach. 

 

If you have questions you can message me. It's an easy way to generate money. If you're sitting in cash, you're losing. Real estate is a pain in the neck, ties up your money and you need someone running it for you. 

 

My 2 cents.

Close end Funds can be good option to invest,but You can lose money as well.Nothing is for sure.

[Lacessit]

2 hours ago, MikeN said:

But if you have planned ahead, looked after yourself and your own financial situation, and become a self funded retiree, you will lose money while continuing to support those who refuse to plan for the future.

I have planned ahead. I  wound up my SMSF in 2016 because I can see the writing on the wall, where governments of any political stripe will be looking to soak self-funded retirees. SMSF auditors are licking their lips with every new regulation of the sector. If you think the Liberals wouldn't do it eventually, you're dreaming.

[Lacessit]

7 minutes ago, vukovar77 said:

I think this is not true.Nobody should believe that.

Agree. The "advisory company" is a stock picker. Ask anyone who invested in RFG on a recommendation from a stock picker what they think of that advice now.

[DrDave]

4 hours ago, vukovar77 said:

Close end Funds can be good option to invest,but You can lose money as well.Nothing is for sure.

Quite correct. 

Although CEFs are not immune to market downturns, they can be attractive for long-term investors as the dividends they pay can more than make up for any loss in value if and when sold.

 

In my case, I've owned one particular CEF for about two years. In those two years, at its lowest point it lost about 8% of its value. Its currently trading at about 2% less than when I bought it, but it pays a little over 8%, which more than makes up for any volatility.

[Coota]

5 hours ago, vukovar77 said:

I think this is not true.Nobody should believe that.

Believe it baby.

<deleted> do you mean by your post?

 

[wordchild]

11 hours ago, Rawairat said:

Australian dividends are still good value, Labor is only taking the tax credits away I believe, which are not available to non residents ? I use VHY.AX the lazy investors way. I’d recommend read A Random Walk Down Wall Street for any investor, especially older less knowledgeable ones.

Great post, and, yes that is Labor policy, at least for now. Even as a non Australian I find some great dividend stocks in that market and I like the Aus dollar down where it is right now. Good time to lock in some income in AUD.better value than US stocks in US dollars or Thai stocks in THB,  just my opinion, obviously 

[wisperone]

10 hours ago, Mike Teavee said:

10 more months until I finally retire but my plan is to live of Savings & House rental income until I'm 56 (I'll be almost 54 at that point) at which point I'll stop re-investing my Dividend Income & take cash to tide me over until my private pensions kick in at 60 BUT "Man Plans, and God laughs", I retired at 40 & the GFC hit (Dividend Income was blown away more or less totally) then retired at 48 & Brexit screwed up my UK Income streams (20% drop in FX rate), so just wondering what is going to mess me up next year ????  

 

My biggest quandary is when to start selling down my assets, I don't really have anybody to leave them to so the ideal would be to liquidate everything & spend it all before popping off this mortal coil... 

 

 

 

 

Feel the same way...wish we came with expiration dates so we knew when our time was coming so we could spend everything instead of leaving it to someone else.

[MadMuhammad]

9 hours ago, vukovar77 said:

It is very hard to live only from dividend.When you take dividend ,stock fall mostly at same amount.You can do it only if You have very big portfolio and many REIT-s with good performance.

I trade about 25 years every day and I can not say that I can live only from dividend yield.An contrary my profit is mostly from capital gain,not dividend.

Agreed. I’m 41 and early retired. I have a heavily weighted dividend paying portfolio but as you stated, this only provides 2/3 of my yearly living budget. Capital growth provides the rest. 

 

It’s been a rippa start to the year. I was down 6% before edging back to even early Jan, by the end of April I’m up 11%. Needless to say I cashed in on that little windfall. 

I also have around 7-8 years living costs in cash when required so I’m fairly protected from panic selling, market corrections and currency swings. 

[MadMuhammad]

9 hours ago, Lacessit said:

Agree. The "advisory company" is a stock picker. Ask anyone who invested in RFG on a recommendation from a stock picker what they think of that advice now.

I bought into RFG a few years back while they are still very healthy. Got out around the $2.80 mark near the start of all the negative publicity. Small loss in $ terms 

Just reenforces the choice to not expose anymore than 1-2% capital to any one stock 

[thaicurious]

2 hours ago, wisperone said:

Feel the same way...wish we came with expiration dates so we knew when our time was coming so we could spend everything instead of leaving it to someone else.

Study the issue carefully but just to say that an annuity can leave nothing. Problem solved.

[Thailand J]

13 hours ago, Pinot said:

CEFs use leverage to generate higher returns. I have considerably more money now than when I arrived in LOS 10 years ago despite living off the dividends. The CEFs I own also appreciate in value. I own about 15 of them. I'll give you my top five to give you an idea and then you can do your own research at Cefconnect.com

 

ETY, ETJ, CHY, UTF, HYB

You did very well. You didn't miss the 10 yr US stock rally. Anyone could have made money in US stocks during the past 10 years by buying into almost any fund.

I invest in US Index funds. Here is how S&P 500 compare to ETY, ETJ, CHY, UTF HYB  in the last 10 years, dividends included . UTF is impressive, others are not so .

 

 

 

 

[fletchsmile]

I live off my investment returns on my portfolio.

 

Part is dividends, but part is also take-out from capital returns: eg on investments that don't pay divs etc

[fletchsmile]

On 5/8/2019 at 8:34 AM, Rawairat said:

Australian dividends are still good value, Labor is only taking the tax credits away I believe, which are not available to non residents ? I use VHY.AX the lazy investors way. I’d recommend read A Random Walk Down Wall Street for any investor, especially older less knowledgeable ones.

Perhaps if you are an Australian.

 

As a non-Australian, one of the reasons I stopped investing in Aus shares was that dividend yields were higher than other countries, but I suffered 30% tax on the dividend. When someone is deducting 30% on dividends that pushes me towards lower yielding shares, and ultimately different markets.

eg Singapore REITs - I earn a higher dividend yield at an average of over 6% and they are tax and capital gains free

[fletchsmile]

Currently looking to sell or rent our condo in Thailand, after buying a house. Lived in it for over 10 years, so it doesn't really owe us anything.

 

But direct property investment really isn't my thing. Would prefer the money in shares, unit trusts, investment trusts, REITs etc

[baansgr]

Yea, currently approx 8.5% with a huge gain after Brexit mostly wrapped in ISAs but weekly trades outside

[petermik]

I have a stocks and shares ISA back in the UK solely made up of Income based funds......£3,500+ per year paid out as dividends plus my portfolio is 9% up in value compared with when I first started it......it did hit 15% pre brexit

[ThaiBunny]

On 5/8/2019 at 2:31 PM, MikeN said:

But if you have planned ahead, looked after yourself and your own financial situation, and become a self funded retiree, you will lose money while continuing to support those who refuse to plan for the future.

Yes, the distinction needs to be made between pensioners and part-pensioners who own shares, and self-funded retirees who own shares. Pensioners/part-pensioners (whose franking credits would be minimal if they're getting the pension) will keep the credits; self-funded retirees will lose the credits.  The system is largely reverting to the original design the then government put in place in the mid/late eighties.  Giving self-funded retirees a cash refund for excess credits was one of the handouts the Liberals gave to their core constituency (old farts) when they were last in government - a complete rort IMHO.  Labor is just proposing to set the system back to the way it was and should always have been.  There's always an outcry when the hip pocket nerve is hit.  A friend of mine refers to self-funded retirees who are screaming in anticipated pain as "tax bludgers"

[TallGuyJohninBKK]

23 hours ago, Pinot said:

 

CEFs use leverage to generate higher returns. I have considerably more money now than when I

 

ETY, ETJ, CHY, UTF, HYB

 

 

The dividends are nice... But if you're owning those kinds of investments, you'd better be prepared and able to withstand substantial price variations/declines when the markets go bad.... meaning.... bigger drops than the markets at large.

 

Look at what happened to ETY in 2009 and again in 2012.... It fell substantially in price in 2009, and never has recovered in the decade ever since anywhere close to its prior values.

 

 

 

[TallGuyJohninBKK]

As for the people who object to owning individual stocks, I think that outlook is misguided....

 

The key to owning individual stocks is to DIVERSIFY... to spread your investments among a large number of different companies that you like and fit your investing criteria in order to minimize risk.  Just like an ETF or mutual fund does...

 

Personally, for my individual holdings, I made it a policy to never let any single holding exceed 3% of my broader portfolio, and 5% for a few rare exceptions. I take the dividends (everything I own are dividend paying stocks), and reinvest those periodically into whatever I consider at that particular time to be the best available investment considering what I already own and hold.

 

The differences being, you're not paying annual commissions like you do with mutual funds. And you're hopefully picking good stocks that you like, as opposed to an index fund that takes the good and the bad without regard to their merits, just because the stock fits into that particular index.

 

I'm not suggesting there's no place for mutual funds or ETF index fund investing.... But I am suggesting, it's wrong to blanket avoid holding individual stocks, unless you're someone who doesn't want to spend any time and effort becoming knowledgeable about what you're investing in.

 

[mike787]

Diversification.

[TallGuyJohninBKK]

23 hours ago, Pinot said:

ETY, ETJ, CHY, UTF, HYB

 

 

BTW, just for the record, I do own a couple CEF holdings, though not those particular ones above.

 

I bought mine AFTER the 2009 market crash, and they're priced now a decade later at just about the same price I paid for them originally, so not much capital gain, though the prices bounce around a bit... So sometimes those are a bit in the green, and sometimes a bit in the red for me.

 

But my two CEF holdings have been consistent and reliable monthly dividend payers through the many years I've held them, so I like that. And monthly dividend paying holdings are always nice, if you can find a good investment that pays monthly.

 

But speaking personally, I'd never devote the bulk of my investment holdings to CEFs alone.

 

[sikishrory]

On 5/8/2019 at 10:33 AM, Tayaout said:

I keep almost everything in bitcoins since 2013. Works fine for me but I'm still under 40 ????

What medium do you trade on? I looked into coinbase but it said not yet available in Thailand. I messaged them to ask if there was a way I could be based from Australia (i'm a citizen but with no ties at all) and never got a reply. That also made me decide against it as if there is ever an issue the customer service is non-existant

[Tayaout]

8 minutes ago, sikishrory said:

What medium do you trade on? I looked into coinbase but it said not yet available in Thailand. I messaged them to ask if there was a way I could be based from Australia (i'm a citizen but with no ties at all) and never got a reply. That also made me decide against it as if there is ever an issue the customer service is non-existant

Try bx.in.th

[rickudon]

Shares are not always a wonderful investment. The UK FTSE 100 was at 6300 20 years ago, only 7300 now. That's less than 1% average growth. Yes you have dividends, but most are quite small. My tracker fund (reinvesting dividends) managed 30% growth in the last 10 years - but that was mainly due to the Brexit devaluation, take that out and it is about 1% per annum, a pitiful return. And it was a typical tracker fund. The first 10 years it had averaged 7-9%.

 

I dumped the tracker 2 years ago as it was only tracking a stagnant economy. Last 2 years my investment has seen a return to 5-10% growth (now in world market funds). Fortunately my investment is small, income is mainly pension. I did mainly manage to avoid the 2008 crash, cashed out into saving bonds in 2007, but was unable to then cash in on the recovery as all long term bonds and needed capital as it became available for Thailand.

 

If i had followed my banks investment advice, i would be a pauper .....

 

 

[BritManToo]

1 hour ago, fletchsmile said:

Currently looking to sell or rent our condo in Thailand, after buying a house. Lived in it for over 10 years, so it doesn't really owe us anything.

 

But direct property investment really isn't my thing. Would prefer the money in shares, unit trusts, investment trusts, REITs etc

6-8% available in Cambodian banks for 1 year fixed term USD (or Thai Baht) deposit accounts (-14% tax if you don't live there).

[Khaeng Mak]

1 hour ago, mike787 said:

Diversification.

 

This info graphic does not work for Australian investors.  The starting point is $155,000 to buy a duplex.  In Australia that amount will not even buy you a demount-able home in a trailer park.