Category: Uncategorized

I have a confession to make. I have not been practicing what I preach lately. Greed has gotten the better of me and I’ve been doing some short term trading trying to make a quick buck. On top of that, I have been eating unhealthily, and neglecting my home gym. Sometimes you have some extra stress and you break your good habits so you can relax a little, it happens to everyone. The hardest part is not putting your foot down and getting back into good habits. The hardest part is keeping it up 3 days later.

I don’t usually write about fitness on this blog, but it’s entirely relevant. I believe keeping a good diet and exercising regularly are one of the best investments you can make. Not only do you feel better, but you’ll save yourself thousands in healthcare costs throughout your life by maintaining a healthy lifestyle.

When I fall into a rut, I often feel like I don’t have control of my life. I’ve found that the best way for me to take back control of my life has been lifting weights. It reminds me that I am in control of how I spend my time. It also reminds me that I’m not perfect, and it’s better to take a step in the right direction than to lament not meeting your lofty expectations.

However, working out after a long period of laziness has a dark side. Delayed Onset Muscle Soreness (DOMS) often comes 24 to 48 hours after a workout, and it is especially bad after you’ve skipped your workouts for a week or more. This is one of the worst things that happens when you’re trying to get back on track. The pain feels like a punishment for making the right choice. Some people are empowered by this pain, but not me. This creates a major psychological hurdle on your path to getting back on the wagon.

If you’re trying to workout after a break, there are some things you can do to prevent DOMS, as well as reduce it after you’re already afflicted.

– Drink a protein shake before your workout
– Make sure you’re adequately hydrated.
– Stretch before and after your workout.

– Eat lots of protein, most body builders say 1 gram for every pound of body weight.
– Keep stretching.
– Stay hydrated.
– Workout even more (lightly).

The last one sounds like the complete opposite of what you want to do while you’re sore, but it’s true. DOMS is typically the result of built up lactic acid in your muscles, by doing a light workout, you will pump more blood through your muscles and clean out some of that lactic acid. Don’t rush into a heavy workout too soon though, your body needs time to rebuild the muscles you’ve broken down.

Hopefully, this has been helpful for anyone that needs a kick to get back into shape.

Now back to investing. As I have made some poor choices lately in my arrogance, I’m going to rededicate myself to maintaining full transparency so I am accountable for my investing choices. In the coming days, you can expect a full disclosure of the investing account I track on this blog, as well as updates with upcoming purchases.

My investing strategy is to take my excess money each month and buy attractive dividend growth stocks. The act of buying stocks every month is usually considered to be “dollar cost averaging” where your returns are going to average out from buying at both high and low prices throughout the year. While this applies to the broader market, it doesn’t account for the fact that each month there is usually a company or sector that is lagging behind the rest of the market and provides a discount. This means that as the market rises and falls, the intelligent investor is still getting a good deal.

For instance, over the past month oil prices have been dropping, and after OPEC made the decision not to cut production (and thus cause prices to rise by reducing supply), the big oil stocks like Chevron (CVX), BP, Exxon Mobil (XOM), and others have seen their prices fall 5% or more. This decrease in price also means an increase in entry yield. At the time of writing this, CVX’s entry yield is 3.76%, BP’s is 5.52%, and XOM’s is 2.91%. Earlier this year, I wrote about ConocoPhillips (COP). At that time (April), the entry yield was 3.9%, now it is up to 4.15%.

If you were thinking about adding oil stocks to your portfolio, now is the time. I’ve personally purchased new positions in CVX and BP. This is not a “once in a lifetime” opportunity, but it’s a strong example of how savvy dividend investors can get great deals throughout the year. Currently, the S&P 500 is at a new high for the year, but you can pick up these individual stocks at a significant discount.

Earlier this year, we also saw Target (TGT) suffering from some bad press after the data breach (Which I wrote about as well). Back then, Target’s entry yield was about 3%, and that wasn’t even the lowest price Target hit this year. In the past few months Target has regained it’s share price level, and even increased their dividend, but the current entry yield today is 2.85%. Hopefully, you readers snagged this one up at a good price like I did. Today, Target seems a bit overpriced with a PE ratio over 30, so I wouldn’t recommend buying it right now, but that’s certainly no reason to sell either (by my standards).

It’s not every day that you get to see a great deal on dividend growth stocks, but there are definitely deals that stand out from time to time. If you’re investing new capital each month, and do your research, you’ll be sure to catch some good ones.

How about you, are you grabbing these oil companies at their current discounted price?

I’ve mentioned earlier that I am looking for a home to buy, and have heard some readers share their opinions about how a permanent residence is a bad investment.

Buying a home as an “Investment” brings out a lot of heated argument in the investing world. There are typically two schools of thought. Many people believe that paying rent is wasted money that could potentially be building equity. Why subject yourself to a continuous expense to have nothing to show for it, right? Well, the folks on the other side of the table see it differently. Owning a home means you are liable for all repairs and maintenance, additionally it means you’re tied down to living in the same place.

Personally, I think both views are too rigid which have major flaws in their logic. You do gain value from the money you pay each month in the form of having the service of someone else handling the maintenance issues. So saying that the money is wasted is a little extreme.

In regards to flexibility, it is true that needing to sell your house before you move is more complicated than moving out of an apartment. However, people often forget about the fact that renters typically have a 1 year lease with expensive penalties for leaving early. Additionally, when it comes time to renew that lease, the tenant usually needs to commit to the next term months before the current lease is even up. So if you want to move without penalty, you need to know you’re moving months ahead of time and can only move in that short window as the lease is ending. I really think the flexibility argument is pretty weak on both sides.

I’m curious to hear from the people who say that a residence is a liability instead of an investment and what they think of owning rental properties. With a rental property, you still have all of the problems of a residential home like maintenance but with the added complication that you could have a crappy tenant that doesn’t respect the home. I think people also tend to forget that you need a place to live just the same as you need food and oxygen.

Owning a home is like owning a rental property where you are the tenant. If you rented out a rental property to a tenant, and then rented your residence from someone else, you’re basically breaking even, assuming they rent for the same price. So at that point, you’re really just taking on additional risk by involving a 3rd party as the tenant.

That’s just my 2 cents, what do you think?

P.S. – The home in the photo is one we’re buying next month! We’re very excited.

As I mentioned earlier, I’ve recently started a new job. It’s a great opportunity for me and I’m very excited to be starting this chapter of my life. The office is in downtown Seattle, so I take the bus every day to get there. I’m enjoying the bus a lot more than driving because it gives me time to play my 3DS, or even just rest and think about things. One thought that has crossed my mind is what my “dream job” would be. Honestly, I think the only perfect job would be one where they pay you to do absolutely nothing. Where you wake up and do whatever you want with the day, and the paychecks keep coming in. Unfortunately, no such job exists… or does it?

It turns out, this is exactly the kind of job a financially independent dividend investor has. Owning dividend stocks does not require you to be at an office at a specific time. Dividends have no dress code or weekly hour requirements. Nobody expects you to log the time you spend on a daily basis when your paychecks are dividend distributions.

There are some downsides to the dividend investor career. They don’t provide benefits like healthcare or dental insurance. There’s certainly no company car, however, there’s also no commute. If you’re the kind of person that feels a sense of fulfillment from working, you’ll be on your own to find ways to still get that feeling. You’ll also

There are also some significant advantages. Dividend income (if qualified) is taxed at a lower rate than normal income and capital gains. This job will give you a substantial raise every year, or least higher than the “standard of living raise,” most companies “generously” give each year. Dividends will also never fire you. Your worst case scenario is that 1 company will reduce or stop their dividend payment, in which case you can sell your stock and invest elsewhere, which is like taking a new job without even updating your resume.

Sadly, you can’t just apply to the job of dividend growth investor, it’s a job you need to work for over several years. It’s truly a grass roots start-up that you grow over time into an engine of freedom.

I love working towards earning this dream job, but in reality, I’m still very much in the start-up phase. Our house hunt is starting to really ramp up, so liquid cash is going to be more favorable than trying to bet on short term gains. This means my stock analyzing and purchasing will probably be paused until we close a deal.

I have some good news and some bad news. First, the good news. I recently got a new job! it represents a significant pay raise, so in the future I will be able to buy more and more quality dividend stocks. However, this job is also going to require me to learn a good deal of new technology and focus most of my extra time towards growing into the caliber of developer I’ll need to be to succeed in this position. This, combined with some tax drama with my wife’s former employer, means that this month be a little short on Buy Smart Never Sell insights. (This is the bad news)

I believe in a week or two I should be able to find the time to get back into a rhythm of posting regularly. For now, I am focusing on finding my new routine and bettering myself as a programmer.

In other good news, March represented a new high in my joint dividend portfolio that we follow on this blog. We made over $30 in dividends in March! This is a huge win after such a short time of investing. There was a time when I’d be lucky to make that much in an entire year in interest. $30 hardly covers all of our bills, but it certainly covers 3 months of Netflix.

FYI, for anyone wondering, the previous post was an April Fools Day post. Please do not take any of that advise seriously.

Whether it’s Link running through Hyrule fields before he even acquires the Master Sword, or the first few stock purchases in your portfolio, there’s always a slow beginning that precedes the awesome climax. The beginning of some games can be especially hard sometimes. You don’t have any awesome items or skills, so when a challenge comes up, the stakes are high and so is the challenge. I completely believe that dividend growth investing follows the same difficulty curve of RPGs where you start off at a disadvantage.

In 4th edition Dungeons & Dragons, characters are separated into tiers based on level. Below level 10 is the Hero tier, between 10 and 20 is Paragon, and finally at level 20, the Epic tier. At each tier, a character can take on significantly greater challenges. Dividend investing is similar. When you’re first starting out, it can seem difficult to save enough money for your first few positions. However, once you have your first 10 companies paying you dividends, it gets a little easier, because the passive income is making up for some of the fluctuations in your expenses. Then at the $150,000 mark, your portfolio reaches Critical Mass. Sounds epic right?. This threshold is labeled this way because a 3.5% annual dividend will payout almost $5500 which is the current maximum contribution to an IRA for a year. This means if you were putting your investments in an IRA, your dividends would be contributing almost as much as you are.

For the past 5 years, I have been working various jobs developing my skills as a web developer, all the while feeling underappreciated and underpaid. After discovering dividend growth investing a little over a year ago, I’ve been taking what little money I could squeeze out of my budget to invest in high quality companies. This year, my dividend income has reached a level where it can cover my occasional video game purchases. I’m finally starting to feel like I’ve made it into the next tier, which is a great feeling.

I like to imagine that, in all of spacetime, I have already reached Critical Mass level, and it’s just a matter of time and persistence until I reach my goal. You’ve accomplished all of your goals as well, you’re just not at that point on the timeline yet. Think about that next time you get anxious about where you are in your investing journey.

For more dividend investing advice, check out Dan Mac’s recent article compiling advice from many dividend bloggers including myself. You can find the article here.

I’ve had a revelation: the purpose of life is to die with the most toys. I know I’ve talked a lot about living below your means and saving money so you can one day retire, but what if you die the day after you retire? Wouldn’t it make a lot more sense to just plan to work forever, and buy all the cool stuff you want?

This is why my new motto is “Buy Luxury Never Quit.” Why make a single sacrifice when you can pay for immediate satisfaction? Patience is for old people, so live it up now and take out a lease on a luxury car. People will know you’re employed when they see you drive to and from work in a sweet Mercedes Benz.

If you accept the fact that you’ll be working until the day you die, all kinds of doors open up. You’re suddenly free to buy the latest home entertainment technology, the newest iPhone (with unlimited data because you deserve it!), and every nifty new gadget you see pop up on amazon. With all of this new awesome stuff, you’re going to need a nice place to put it too!

Housing is one of the “big three,” which means it’s one of those 3 things you should spend the most on. Find a house worth at least $500,000, you don’t want other people to think you’re poor, do you? The more space you have, the better, and make sure it has a 2-car garage so you have space for your new Benz (another of the “big three”) and your old lame car from when you were misguidedly saving money.

The final piece of the “big three” is food. I have 4 words for you “Eat Out Every Day,” or EOED which just rolls off the tongue. Cooking at home is what peasants do, so live a little and buy a steak with a nice wine pairing for dinner like the noble, upper class aristocrat you are. People are going to judge you based on what you eat, so show them who’s the boss. After all, you are what you eat.

You may be wondering, “how am I supposed to afford all of these things I deserve one my current paycheck?” Here’s the great thing, you don’t have to! You can take out loans, mortgages, and credit card debt to live well above your means. Once that debt grows beyond what your paycheck can cover in a monthly payment you’ll be dead anyways, and then it’s someone else’s problem. That’s the beauty of debt, you get all of the benefits and can just pass the downsides off to your family.

I hope you’re ready to live a more fulfilling life like me. Let me know in the comments, what are you going to spend all of your money on?

I am so mad. I reviewed the site that was supposed to be an all in one deal and discovered not only did they hardly put any content into the site, they didn’t even use wordpress as advertised. The pages were all raw html. Now I need to have someone convert the pages into a wordpress theme so I can maybe salvage this terrible site. It’s going to take a lot of work on my part to make it happen, which completely defeats the original purpose. The only decent fiverr gigs I found for this were going to cost multiple gigs. I am reaching out to the vendors for pricing, if it’s over $20, I’ll do it myself.

For the other site, which I personally worked on building, the only problem I’ve had so far is that 2 out of the 3 articles I ordered on fiverr were grammatically terrible. My advice for anyone using fiverr is make sure the seller is either in the U.S. or is highly rated. Read the comments and reviews to determine if they’re legit or not. I’m getting close to completely swearing off the site, but I am giving it a couple more shots first.

I was hoping this side project for passive income would be achievable with minimal effort, so far that does not seem to be the case.

I also have an update on the articles on I wrote a 3 articles a few weeks ago, I earned $0.03 in the first week, but then I haven’t earned anything since. I think the problem is that since there are always new articles being added, unless you keep up with it, the income is likely to die off. Thus, it’s not really passive income anymore, and if you’re going to do all of that writing, why not put up a fiverr gig and at least get $5 for each article. Better yet, just start a blog.

So far my quest for other sources of passive income are not showing many results. I will continue to build out the 2 niche sites, and give them some time to gain some search ranking, but I’m not betting my retirement on it.

One of the most confusing concepts of dividend investing is understanding how and when you get paid a dividend. If you’re new to dividend investing, you may have no idea of even where to look. You might think you just get paid a dividend for owning the stock right away, like a gunshot in Call of Duty. In reality, it’s more like Angry Birds, there’s a delay before you get your payout.

So first, let’s start with the vocab lesson.

The 4 terms you will see on these sites are the “Declared Date,” “Exdividend Date” (or Ex Date), “Record Date,” and “Pay Date.” The most important ones to know are the Ex dividend Date and the Pay Date. It’s very simple: if you own a stock when the opening bell rings on it’s Exdividend Date, you will be paid the dividends for each share you own on the dividend Pay Date. So if MCD has an Exdividend Date of 2/27/2014, for you to “Capture the dividend,” you must buy shares on 2/26/2014 or earlier. Then, on their Pay Date, 3/17/2014, you will receive dividends for each share you owned on 2/27/2014.

It should be noted, that for a dividend to be “qualified,” and thus taxed at a lower rate, you must own that stock for 60 days before and after the Exdividend Date.

The “Record Date” is usually a day or so after the Exdividend Date, and this is when the company looks at their records from the Exdividend Date and determines who is eligible to receive a dividend payment. The “Declared Date” is the day the company announces its next dividend. For the most part, these dates are not really relevant to the standard dividend investor, and can thus be ignored.

When I need to find out when a specific stock pays a dividend, I look on either or These sites also have features that will let you search for stocks that have upcoming Exdividend Dates.

There is an investing strategy called “Capture the Dividend.” Where an investor purchases the stock the day before the Exdividend Date and then sells afterwards. This allows them to receive the dividend payment and potentially reallocate their cash elsewhere, maybe to capture another dividend. The problem is that on the Exdividend Date, the stock price usually “gaps down” by the amount of the dividend payment. For our example of McDonalds, if their dividend payment is $0.81 per share, and the closing price on the night before the Exdividend Date is $95.00, the opening price will be $94.19 the next morning.

This is not considered a safe or reliable strategy because there’s no guarantee that the price will move back up to or above the price you bought it at before receiving the dividend. Additionally, since this dividend is not “qualified,” you will pay taxes on it as capital gains (which is a higher rate). The most tried and true strategy for quality dividend stocks is “Buy and Hold.”

Well, hopefully you have a much better understanding of what you’re looking at when analyzing a stock.

They say “You can’t see the forest for the trees.” In other words, it can be easy to lose sight of your goals while focusing on the tactics. For us dividend growth investors, and most other investors for that matter, we do what we do as a means to an end. Financial independence (FI) and/or early retirement (ER) are the primary goals for all our research and hard work. It can be easy to forget that while diving into earnings reports and dividend history. This is why it’s important to set a clearly defined goal.

A common goal across the investment blog community is to achieve FI/ER by the age of 40. But what makes 40 so special? I asked some of the people who inspire me to share their thoughts.

Joe at, who is already enjoying early retirement, said “I think 40 feels like the mid point in our lives. If you’re not happy with your life by then, you need to make a change.” Many of us spend the majority of our time working at jobs we don’t love to cover the costs of living. We only have so much time on this planet to enjoy, so if there’s a way to enjoy it more, why not pursue it? Joe saved everything he could to invest in a number of different strategies including dividend investing, Peer-to-Peer (P2P) lending, and real estate. In July 2013, these investments empowered Joe to leave his corporate job and live life on his terms before he even actually turned 40.

Achieving that freedom while you can still enjoy it is important too. Jason Fieber at says “I think 40 is a popular age because it’s young enough to still live life to its fullest, while also being old enough to be experienced enough to know exactly what you want out of life.” This is why setting a goal early and working towards it is so important. “… if you start working at 22, and retire at 40 you’ve got 18 years to build a large enough portfolio to live off of.” Jason’s journey began in 2010, 2 months before his 28th birthday. His plan: “to save more than half of my net income for the entire 12-year period and invest in high quality companies that pay rising dividends at attractive valuations.” So far he has built a portfolio valued at almost $150k, which many consider to be “Critical Mass.”

Setting the goal is important, but knowing what you want to do with that freedom is important as well. Tim at invests to have the freedom to never be stuck in a job he hates and to give back to society. His goal would be better defined as financial independence rather than early retirement. In Tim’s eyes, “Financial independence lets you become more philosophical and focus relentlessly on personal happiness and benefiting society without getting caught up in the rigmarole of the paycheck-to-paycheck lifestyle.”

40 is such a popular target age because you’re young enough to still enjoy the money. What good would all of your hard work and saving be if you were too old to enjoy it? You always hear retired people say “youth is wasted on the young” but what they really mean is “I wish I knew what I know now when I was younger.” This is why the best time to start saving money and investing is NOW. Set a goal for yourself, and be clear how you want to achieve it. What age do you want to retire by? How much money will you need? How much do you need to save each month to achieve that? Once you have your plan, start acting on it. For me, this means buying dividend paying stocks that raise their distributions each year like MCD and TGT.