The markets are in turmoil. Stocks are on track for the worst December since the Great Depression. Everyone is posting about how their net worth is disappearing overnight, and billions and trillions of dollars of worldwide net worth are being wiped out in a matter of moments. However, the Dividend Investor is able to remain calm and strong.
Why is this so? By adhering to the simple investing principles of the dividend investing strategy, I am able to divorce myself from the erratic downswings in the everyday markets.
In fact, I welcome the market taking a nosedive, as my main goal to accumulate more and more dividend income via additional share purchases. I can do this better when I am able to purchase more stock at lower prices. And a decline in the markets offers me better buying opportunities.
It’s not that I enjoy seeing stocks go down because I know that many people the world over experience increased turmoil. Like many others, I celebrate when I see my positions appreciate.
However, I have worked hard to develop the mindset where whenever I see a market downturn, I look at it as a buying opportunity instead of losses on my positions. To me, a drop in share price now means that stocks are on sale. Gradually, I am adopting this mindset more and more as my investing acumen continues to improve.
While some pundits believe that companies will now have lower life spans due to ever increasing technologies which can and will put those companies out of business, I continue to adopt a ‘buy-and-hold forever’ strategy. Whenever I initiate a position in a stock, I plan to hold on to this company forever, as I am now a part owner in their operations.
To paraphrase a great Buffett quote;
“Buy your stocks as if the market was going to shut down tomorrow with no set date for reopening.”
With this in mind, I buy stocks irrespective of market declines or rises. If the market goes down, I see those socks on sale and potentially better buying opportunities. However, I am also happy when stocks are going up, as that means the companies I am investing in are becoming more valuable. It is a win-win proposition.
So what is it like to be a dividend investor? Let’s take you through a typical day.
A Day in the Life of Mr. Dividend Investor
I wake up at 5 am. Normally, I don’t always get up this early, but whatever I do I feel fantastic as I’m in the ‘hustle and grind’ mindset, where no one is going to beat me. I shower, maybe do a few push-ups, and get myself mentally prepared for the day.
Typically I make a task list with more tasks on it than I can handle for a day. My goal is to reduce this to a more manageable level, but balance has never been my strong suit.
On the top of my list is to dig into my stock screener for potential stock buying opportunities. One of my main financial goals in 2019 is to double my passive income to $6,000, largely through buying stocks that pay dividends.
With the massive drop in stock prices of late, there are sure to be some deals to be had. A few other tasks are to “drum up” some business for my consulting business and to write this MBR article for you.
With the day planned out, I head out to a coffee shop.
My first stop is to my local Starbucks ($SBUX), which opens up around 6 am. I am not a specialty drink type of guy, but I’m a sucker for a nice light or medium roast coffee.
I put in my order, typically a medium coffee, and find my high top. Then proceed to sit down to go to work for a few hours. The hustle is on!
As I drink my coffee and complete my work, I look around me and I see the bustle in the store picking up. There is so much going on – people are coming in and ordering coffees, business being conducted in this space, friendships are being formed.
Quickly, I am reminded; I am part owner in this company. In buying the Starbucks stock, I share in the service of these coffees, the business being conducted, and the friendship being developed. Their success is my success.
Lunchtime: $F, $BP
A few hours pass in the blink of an eye when you are working hard; time to break for lunch. As I walk out into the parking lot, I take notice of the different models of cars. I personally own a Toyota RAV4, and it has treated me very well. I am amazed at all the different makes and models out here – some Hondas, some Chevys, some Fords.
Having recently initiated a position in Ford ($F), I am much more conscious of how many vehicles I see on the road. I do see a lot of Ford 150 series trucks, and it just reminds me that these trucks are the best selling trucks in the world. What is the stock doing?
I’m not sure – it might be down, it might be up today – all I know is that I own a piece of this company. At the end of the day, Ford seems to be doing what it does best as well as making some great headway into the electric vehicle markets. Good enough for me.
Before grabbing lunch, I realize that I gas tank is running low, so it’s time to make a stop. I choose my local Beyond Petroleum ($BP) station, where the recent downturn in gas prices has caused my gas price at the pump to go down. As a consumer, I am pleased by the macroeconomic events that are driving down gas prices. Who wouldn’t want a cheaper gallon of gas?
While I might not be thrilled about the decline in crude oil prices from an investment perspective, I know that oil prices are very cyclical. And depend on many forces outside of my control. I’m going to keep watching the company to make sure that they are continuing on solid financial footing. And that they are making good headway into renewable energy resources.
Happy Hour: $BUD
After some lunch and some more time spent working, it’s time to be done with my day. It is time to head out to the bar with a few of my friends as we have a happy hour ready to go.
As we are chatting up about our days, I casually check out the drink menu. I see some great wines and specialty drinks to choose from. But I’m definitely in the mood for a beer tonight.
I see Stella Artois and Shock Top on the menu, both of which are owned by AB InBev ($BUD), a recent addition to my dividend portfolio. I end up going with the Belgium beer, Stella Artois, while having a couple of laughs with my friends.
In between conversations, I take a moment to look around and observe the surroundings. All of these people, done with a day of work, are letting loose and enjoying some adult beverages with good friends, perhaps family.
Being that I now own a piece of an awesome company, I can rest assured that as I order this beer, and as those around me are ordering their beers, I am helping serve them drinks and happiness through my continued ownership position.
I get away from the daydream drifting and back to chatting with my friends. Time to order another round and exchange more stories.
Life doesn’t get much better than this.
I get home kind of late, as the time just flies during those happy hours. I take an Uber home from the bar, as I happen to be a very responsible person.
As I enter into my house, I realize I’m exhausted and it is now time to get ready for bed. I reach for my toothbrush, I go ahead and grab some Crest toothpaste, which is a subsidiary brand under the Procter & Gamble ($PG) family.
As I brush my teeth, I realize that with my toothpaste purchase, I’m helping support one of the businesses that I own. It is a great feeling to know that as I’m staying healthy, I’m also making money at the same time.
As I am ready to crash, it hits me, I need to wear that sexy purple button down dress shirt for tomorrow. However, I need to wash my shirt; time to do a quick load of laundry.
I turn on the washer and let it fill up, as I listen to the steady stream of water fill the steel basin. I assemble a few clothes to throw in, pull out my Tide PODS detergent, also owned by Procter & Gamble ($PG), and put that into the water.
It begins to froth with good smelling freshness. I’ll have to admit, I’m not a huge fan of doing laundry. But I’m a huge fan of fresh and clean, so I force myself to get through this chore. I stay up and wait the thirty minutes for the wash to get done, then throw the clothes into the dryer.
Before the Day ends..
Now my head hits the hay and though I am tired, I take a moment to remember all the great things that have happened during that day. While I’m not completely focused on money at this point in time, the thought crosses my mind that throughout my day, I have supported the businesses that I own.
I have purchased their products, I have seen other people purchase their products. And overall, things are progressing as they should. Did the markets tumble yesterday? Maybe. But to me, it doesn’t matter as much. As I’ll take solid, long-term ownership in dividend paying companies instead of watching market movements. I can rest easy that through market ups and downs, I receive my dividend payment through continuing operations.
I’m drifting off to sleep now and will wake up rested, rejuvenated and ready to roll tomorrow.
It is sure good being a dividend investor.