Which of the following are true? There’s no secret to dividend investing. There is a secret secret to dividend investing.
Not a trick question, because both are true.
Let’s look at this situation.
There Is No Secret
Dividend investing is simple. Here’s what to do: buy some high quality dividend paying stocks. Let the dividends roll in, quarter after quarter, Keep reinvesting. After some years, you have two great things: [1] Ever-increasing dividends, and [2] A nice pile of assets.
There Is A Secret
Dividend investing is mysterious. People say to do things, nobody gets the whole picture.
The Answer
So you may ask, how can both be true? My reply is that both are true.
It is the same question as when asked: is light a particle or a wave?
The scientists can tell you: it is both. If you set up an experiment to prove it is a wave, you will see results that say it is a wave. If you set up and experiment to prove it is a particle, you will see results that say is is a particle.
So Where Does That Leave Us?
Since we can see that contradictory viewpoints can exist at the same time, then a resolution can be to: [1] live with the contradictions, and [2] do not let the contraditions divert you from your goals.
We know that life is uncertain. There are no guarantees. In the realm of investing and dividends specifically, we can never be sure of any specific event until it happens. Some companies will do explosively well, some companies will wither, many companies will do just satisfactorily. In the face of this uncertainty, what do we do? We diversify.
What Is The One True Thing That Never Fails?
There is one thing we can bank on. It is Time. The earlier we start with our endeavors, the more time we have to grow.
So it is with investing. Starting to save and invest in one’s twenties is worth many times starting to save and invest in one’s thirties. Start early. That is the first secret.
Next is to let it grow. Don’t squander gains for frivolous things. Let it accumulate and compound. That is the second secret.
The secret is out. What will you be doing? You can let me know your thoughts here.
The illusttration of the Aurora Borealis was made by French artist, astronomer and amateur entomologist Étienne Léopold Trouvelot in 1882.
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