There are so many ways to make money. Job, business, craft, skill… all add up to making money, or at least potentially. But dividend investing is special. And easiest. Let me tell you why.
Most But Not All
When you have a job, you earn based on what your time is worth or what you produce. Most jobs are based on the number of hours you do it. Or the time frame it is set at: monthly, annually and so on. So if I have an annual salary of X dollars, then I get that amount per year, broken into smaller time frames like bi-weekly or monthly. Maybe I have a job that pays commission. In such a case I earn based on what I produce.
In all of those situations, my income is limited by the time it takes me to do what I do. Once I get the income, it is mine. But no more flows to me until I put more hours in or produce more. I must constantly be working or producing to continue that income.
Why Dividend Investing Is Different
When I buy stocks that pay dividends, once I own the stock the dividends are sent to me forever. My one-time purchase is a forever purchase. The dividends roll in, quarter after quarter. They will never stop.
Of course there are situations where things can change. If a company is purchased for cash, then my stock is purchased, and I receive cash. Or in dire economic times, dividends may decline or be halted. So we diversify to avoid losing all dividend income. As long at the economy is sustainable, then dividends continue.
We choose large, stable companies with long histories of paying dividends so we we can have confidence in the their ability to continue their dividends.
Once And Done
Coming up with enough money to purchase stock is the first and only step that is needed. It might take some work to get over that hurdle. But once done, it is done forever for those shares.
Forever Mean Forever
And those stocks which you purchased produce dividends quarter after quarter, year after year. And your heirs can inherit them, and the dividends flow to them, forever as well.
And
And let’s not forget than many of these companies have increased their dividends year after year. So it stands to reason that dividends will be increasing. That means that the longer you hold these dividends, the more income you will receive.
What Is Your Dividend Way? Let me know here.
The Cabacete (Helmet) is from late 15th Century Spain. Courtesy The Cleveland Museum of Art.
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