Howdy

[texsubmariner]

Hello everyone.  I have been a passive reader of this site for a couple of years to try to learn a little about DGI investing.  I am in my upper 50s and have retired from the military for about 9 years  after almost 30 years of service.  I joke to everyone that the military pays me well to stay away.

  I really didn't have the money to really invest until recently and am looking for ideas on where to start, how much should a starting position in a stock be (minimum/maximum), and anything else that anyone feels is important for a new guy like me.  While I am looking at DGI stock and expect I am way late to the game, I am also looking to be able to pass on to my children for them to continue to grow the portfolio and use the dividends to live on and/or pass to my grandchildren.  I intend to re-invest the dividends as I really don't need to income at this point.

  I don't have income, so I can't start a 401k or IRA, but I have started my children in a ROTH IRA this year.  I do own a very, very, very small business, but I don't draw a salary from it yet.  I've thought about doing so in the future so that I can open an IRA or go with someone like Betterment to open a 401K.  The max I would pay myself would only be about $1,000 a month initially, but I would probably put all of it in an IRA/401K.

  BTW, I'm in a similar position as Eric's parents, but may have a little more cash to invest.

  Thanks in advance for any insight and patience with me. 

  Also, I was a nuclear power plant operator/supervisor in the military.

[fenders53]

(08-08-2021, 12:18 PM)texsubmariner Wrote: Hello everyone.  I have been a passive reader of this site for a couple of years to try to learn a little about DGI investing.  I am in my upper 50s and have retired from the military for about 9 years  after almost 30 years of service.  I joke to everyone that the military pays me well to stay away.

  I really didn't have the money to really invest until recently and am looking for ideas on where to start, how much should a starting position in a stock be (minimum/maximum), and anything else that anyone feels is important for a new guy like me.  While I am looking at DGI stock and expect I am way late to the game, I am also looking to be able to pass on to my children for them to continue to grow the portfolio and use the dividends to live on and/or pass to my grandchildren.  I intend to re-invest the dividends as I really don't need to income at this point.

  I don't have income, so I can't start a 401k or IRA, but I have started my children in a ROTH IRA this year.  I do own a very, very, very small business, but I don't draw a salary from it yet.  I've thought about doing so in the future so that I can open an IRA or go with someone like Betterment to open a 401K.  The max I would pay myself would only be about $1,000 a month initially, but I would probably put all of it in an IRA/401K.

  BTW, I'm in a similar position as Eric's parents, but may have a little more cash to invest.

  Thanks in advance for any insight and patience with me. 

  Also, I was a nuclear power plant operator/supervisor in the military.

Welcome to the forum.  A couple of my high school buddies did a Navy Nuclear Sub gig and worked at our local power plant after.  Very good career move for them.  I am retired MIL as well.

Great move on the ROTH for your kids.  Find a way to put a few bucks in it for them the next few years and don't give up convincing them to feed it every year.  It's my understanding it's one of the best ways to leave money to your heirs.  Take care of yourself as well of course.  Hope you find time to post here.  We are gaining a little momentum lately.

[crimsonghost747]

Welcome. It's great to see new people joining.

I wouldn't worry about age too much, you still have plenty of gas left in the tank and indeed you can simply leave all the DGI goodies to your children/grandchildren when the time comes.

Regarding your future portfolio, right now the valuations are pretty high so I would start slow. I understand there is a certain amount that you want to invest, I'd consider dividing that by 12, (1 year) 18 (1.5 years) or 24 (2 years) or something similar and buying monthly. This is just so you don't push a huge chunk of your savings into the market only to see everything drop by 30% a few months later. It's always good to have some cash which you can use for investing purposes if the market happens to give you a nice discount.

I would start by just buying some of the very basic DGI companies. Something like
-25% JNJ
-25% PEP
-25% LHX
-25% whichever utility you prefer. AWR/AWK/WTRG are all solid in the water side of things, but very expensive. There are plenty of threads and a lot of knowledge here if you prefer the energy side of utilities. XLU could be worth looking at, it has all the big boys in it.
-If you feel like still buying into tech at these levels then add something like MSFT.

Main thing is to just get started with some high quality companies, the rest you will figure out with time.

[fenders53]

(08-08-2021, 02:35 PM)crimsonghost747 Wrote: Welcome. It's great to see new people joining.

I wouldn't worry about age too much, you still have plenty of gas left in the tank and indeed you can simply leave all the DGI goodies to your children/grandchildren when the time comes.

Regarding your future portfolio, right now the valuations are pretty high so I would start slow. I understand there is a certain amount that you want to invest, I'd consider dividing that by 12, (1 year) 18 (1.5 years) or 24 (2 years) or something similar and buying monthly. This is just so you don't push a huge chunk of your savings into the market only to see everything drop by 30% a few months later. It's always good to have some cash which you can use for investing purposes if the market happens to give you a nice discount.

I would start by just buying some of the very basic DGI companies. Something like
-25% JNJ
-25% PEP
-25% LHX
-25% whichever utility you prefer. AWR/AWK/WTRG are all solid in the water side of things, but very expensive. There are plenty of threads and a lot of knowledge here if you prefer the energy side of utilities. XLU could be worth looking at, it has all the big boys in it.
-If you feel like still buying into tech at these levels then add something like MSFT.

Main thing is to just get started with some high quality companies, the rest you will figure out with time.

Great advice from Crimson.  Almost all the hold forever stocks are expensive, but that is where you want to start any DGI port. Dollar cost average in.  You'll catch a deal on a few shares along the way.  At age 50 it's just not smart to pay for 2023 earnings for a stock that grows at a modest rate.  It's not good to do it at 25 but time can cure it then.  We can't promise the market pulls back soon but there is a good chance some individual stocks will as the market rotates from sector to sector through all the upcoming news.

[ken-do-nim]

One of my old bosses - now retired - used to work on a nuclear sub.

You might want to start with a DGI etf instead. I just picked up SCHD for that reason, even though I already have a bunch of individual DGI stocks. Thread on the topic: http://dividendgrowthforum.com/showthread.php?tid=1955

[ChadR]

Welcome to the forum. If you're only looking at doing $1,000/month in salary, it might be cheaper to just do an IRA instead of a 401k. Not sure what the fees for a Betterment 401k are, but it won't be cheaper than a the $0 annual fee that most brokerage houses charge for a traditional IRA or a ROTH IRA. On a minimum amount to start investing in a position, starting off with 1 share is better than not having any shares. With $0 trading fees, don't feel the need to wait till you have $1,000 or more to invest into an individual stock. With the name of texsubmariner, I'm guessing you're living in Texas.

[mid range]

Welcome to the forum, Texsubmariner!

[texsubmariner]

(08-08-2021, 06:26 PM)ChadR Wrote: Welcome to the forum.  If you're only looking at doing $1,000/month in salary, it might be cheaper to just do an IRA instead of a 401k.  Not sure what the fees for a Betterment 401k are, but it won't be cheaper than a the $0 annual fee that most brokerage houses charge for a traditional IRA or a ROTH IRA.  On a minimum amount to start investing in a position, starting off with 1 share is better than not having any shares.  With $0 trading fees, don't feel the need to wait till you have $1,000 or more to invest into an individual stock.  With the name of texsubmariner, I'm guessing you're living in Texas.

Thanks Chad.  The reason I thought of 401k is I could put more than $7,000 a year into it. But, I fully undrstand the cost side of it that the business would have to pay to have a  place lije Betterment to set up and tun it.  But, this would also give me the option to add other members (family) down the road if I decided. 

And yes, I live in the great State of Texas ? and served on nuclear-powered submarines while in the Navy.

[ChadR]

(08-09-2021, 04:07 PM)texsubmariner Wrote:

(08-08-2021, 06:26 PM)ChadR Wrote: Welcome to the forum.  If you're only looking at doing $1,000/month in salary, it might be cheaper to just do an IRA instead of a 401k.  Not sure what the fees for a Betterment 401k are, but it won't be cheaper than a the $0 annual fee that most brokerage houses charge for a traditional IRA or a ROTH IRA.  On a minimum amount to start investing in a position, starting off with 1 share is better than not having any shares.  With $0 trading fees, don't feel the need to wait till you have $1,000 or more to invest into an individual stock.  With the name of texsubmariner, I'm guessing you're living in Texas.

Thanks Chad.  The reason I thought of 401k is I could put more than $7,000 a year into it. But, I fully undrstand the cost side of it that the business would have to pay to have a  place lije Betterment to set up and tun it.  But, this would also give me the option to add other members (family) down the road if I decided. 

And yes, I live in the great State of Texas ? and served on nuclear-powered submarines while in the Navy.

Just make sure the costs are too high.  The tax savings don't always cover what the cost to run it could be.   Not the end of the world to put anything over $7k into a taxable account instead of retirement.

Glad to have another Texan on the forum.  Fort Worth here.