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I won't even bother to watch some "influencer" video on YouTube. I could care less what they say, as it just tends to be their own pet theory with little actual data to back up the claims.
With that said, anyone can read the studies done by academics and investment professionals, and decide for themselves. There have been a number of studies covering different periods of time, and they have all concluded that non-dividend paying stocks are, as a group, poor performers.
I expect this surprises a lot of people, as they tend to only think of stocks that are in the news a lot such as Amazon or Netflix. For every one of those success stories, however, there are scores of laggards and companies that failed.
Simply owning the s&p 500 has more than 80% of the companies paying dividends.
You really can’t own much in the way of large caps without owning dividend payers as most do.
If I look at VIG which is a fund based on dividend payers vs fidelity blue chip growth which does not usually pay dividends , 10k in 2007 in VIG is 40,328 while 10k in fbgrx is 60k .
So there is a lot more to things then dividends or not
Last edited by mathjak107; 02-23-2023 at 02:25 PM..
If I look at VIG which is a fund based on dividend payers vs fidelity blue chip growth which does not usually pay dividends , 10k in 2007 in VIG is 40,328 while 10k in fbgrx is 60k .
Any of us can choose two investment vehicles and a timeframe to make any asset look good (or bad). Such a comparison hardly qualifies as a study.
The papers and books I mentioned were written by investors or investment houses using historical stock databases, covering a variety of timeframes. As I already mentioned, they've all come to similar conclusions. The fact that you apparently do not like what they found does nothing to diminish their work.
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One final thought for now... I'll suggest that people not get their investment advice from YouTube. There are plenty of good resources online and in paper that are free or cost very little. I like Morningstar, and the big discount brokers have some pretty good educational materials. I've read dozens of investment books, and can without hesitation recommend any books that were written by Peter Lynch, John Train, or Jeremy Siegel. I'm not suggesting they are the only good ones, of course.
came across another strange comment, the fact that living off "dividends" or living off selling your "portfolio" is functionally the same seems to be something that a lot of people simply refuse to believe
These are FIRE bloggers and they've written an entire BOOK on Retirement Finances and I am surprised that they don't understand this simple concept.
came across another strange comment, the fact that living off "dividends" or living off selling your "portfolio" is functionally the same seems to be something that a lot of people simply refuse to believe
These are FIRE bloggers and they've written an entire BOOK on Retirement Finances and I am surprised that they don't understand this simple concept.
the financial writer world is filled with financial ignorance.
there are very few i waste my time listening to as most ave such weak understandings of things .
the same is true with many advisors .
they are only first getting their feet wet in the retirement area after decades of following the boomers …they still run on old school beliefs and outdated methods .
a financial advisor for the accumulation stage is a dime a dozen ..but got advisors for the retirement stage are few
Last edited by mathjak107; 03-08-2023 at 03:16 AM..
4% is fine and will continue to be fine. That's a very conservative SW rate.
it is only conservative though if one is using at least 35% equities . it is pretty risky using just fixed income alone , and it has already failed way to many times to be considered safe.
so it isn’t the draw rate that is safe as much as the allocation making it safe
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