dividend investing and Real-estate investing / general advice

[BORN SAVER]

Hey guys wanted some input form you guys about dividend investing and Real-estate investing.

1. I wanted to get your thoughts on dividend growth investing. Is it good or not? I like the concept of it since you don't have to sell off the principle. i typically buy ETF such as VTI or VYM where there 1 and 3% divided and 8-15% growth return. ideally end up with 1.7m before retirement
2. I also have started to get into real-estate investing and if there any any good taxed advantaged ways to combine to 2 strategies. Ideally i think i would like to buy single family homes that are fixer uppers. fix them and rent them out or flip them (mainly rent out).
3. What the best thing to do with my 401ks? roll them into a IRA and put it in VTI?
4. What do you guys do for health insurance when retiring early?
5. General advice

background info:

I'm 30 my wife is 31. I have 2 boys. A 3 year old and 1 year old. I currently work at a steel mill and made 92k this year. My wife is a nanny and will probably clear 12k and gets to take the kids with her and watch them too. I absolutely hate my current job get 1 personal day and 1 week of vacation but i can only use that week of vacation during there shut down which is a 2 week period. I am also required to be on call at any given point and have been on  the overtime schedule for 2 months and have 0 life when I'm on overtime schedule. This does not work with my goals as I am trying to get as much freedom and family time as possible as i get older. I am planning on paying my cars off here in the next few days. This is because i want to get out of there ASAP hopefully with in 2-3 months. This is so that I can lower my bills and opens more jobs for me to take. The goal would be anything with $25 or more an hour. Ideally With a renovation compony just so I can get more practice and cause I got a lot of satisfaction from doing my house. The goal is to retire at 45 if i can manage that some how. After i change jobs and take the pay cut I will be able to save 500-1000 a month till we get the kids in school. then my wife can get a full time job hopefully in the 15-20$ an hour range at which point we will be able to $1500- $2300 a month.

I bought a fixer upper with cash from selling half my tesla stock bonuses when it peaked ruffly 40k and profited 60k from my last house sale. i bought a  3bed 1 bath bank owned property. renovated the inside completely minus the kitchen and I still have to do the outside and kitchen. I bought the house for 78k i have put 24k into it and will probably to another 15 to 20k into it. I will probably sell between 150k to 175k in todays market if I were to have everything done. It will probably would probably rent out for 1,200 a month but i don't think the rental market would be the best here. So we will see what we do if we decided to move out in the future if we have another kid. Or if ill just save up and get another property.

other investment
everything i have is 100% stocks / etf I believe
29k in an old 401k with fidelity in (25% small cap 25% mid 25% large 25% international)
6k in roth ira in (VTI)
20k tesla stock from stock bonuses
15k current 401k with t rowe price
17k wifes old 401k not sure with how


88k in total from these

i have 29k between my robin hood account and bank account but these will be getting drained to pay off the cars. i will probably have 3k-5k cash reserves buy the time i leave.

[Stimpy]

1.  Stick to ETF investing unless you really want to take the time to figure out DGI.  Not to put DGI down, though I know some here will, but unless your really interested in picking stocks, which is sound like you are not.   ETF's are just an easier way to go.
2.  I am aware that some IRA's allow you to use the money for real estate BUT I am unfamiliar with the specifics.  Beyond that, I'm sure there are more aggressive tax strategies of some sort but I have yet to dig deep into those.


As for the rest, I am not sure I can say much beyond that these forums are full of good advice. 

[ATtiny85]

Dividend investing vs not investing = good
Dividend investing vs total market investing = taxes if in taxable and likely worse returns in practice.

[Mr Mark]

I would say Dividend Investing is better when you're near or post FIRE. Then, a solid company cash cow paying solid ~5% dividends (and growing them) gives you some reliable regular income and exposure to the general stock market (tho long term probably under performs equity index, medium term who knows?).

And even then, you want them in a tax protected account.

For you, at your age, I'd go 90% total market index buddy. If you can, meanwhile buy and live in a run down house with solid bones in a growing area, fix it up, sell after 2 years (tax free cap gains), and repeat.

[ATtiny85]

I would say Dividend Investing is better when you're near or post FIRE. Then, a solid company cash cow paying solid ~5% dividends (and growing them) gives you some reliable regular income and exposure to the general stock market (tho long term probably under performs equity index, medium term who knows?).

Better than what? Not investing? No such thing as a solid dividend any more than any other investment being solid. But I am done with the topic. (Appreciate you say 90% index as recommendation)

[Must_ache]

Agree with everyone that with that long of a time horizon I would skip the dividend focus. 

Dividends aren't particularly magical.  When a company coughs up a dividend payment, it gives money away and theoretically the stock price goes down accordingly.

Growth companies tend to hang on to their capital, as they think can do better reinvesting their money into their growing business.  The companies that spew out dividends tend to be established money makers, but give back lots of that capital.  Dividend companies will probably will not grow as fast during good times, but might also be less prone to contraction in bad times (maybe)?

Also, beware really high dividends.  If a company is paying our 8%/yr check the 5-yr chart to see if the stock value is plummeting.  I think DVY is great if you're 50+ when you have a lot of money and are happy to trade lower returns for  lower volatility.  But I wouldn't be keen to purchase it at 30.

[ATtiny85]

When a company coughs up a dividend payment, it gives money away and theoretically the stock price goes down accordingly.

Ain’t no theory to it, it’s simply a simple fact.

[Abe]

Hey guys wanted some input form you guys about dividend investing and Real-estate investing.

1. I wanted to get your thoughts on dividend growth investing. Is it good or not? I like the concept of it since you don't have to sell off the principle. i typically buy ETF such as VTI or VYM where there 1 and 3% divided and 8-15% growth return. ideally end up with 1.7m before retirement
2. I also have started to get into real-estate investing and if there any any good taxed advantaged ways to combine to 2 strategies. Ideally i think i would like to buy single family homes that are fixer uppers. fix them and rent them out or flip them (mainly rent out).
3. What the best thing to do with my 401ks? roll them into a IRA and put it in VTI?
4. What do you guys do for health insurance when retiring early?
5. General advice

5. General advice - look up the case study format and get more details about your finances. It'll probably be helpful for you to see your true savings/spending (every dollar going in and out).

For the others:
1. Lot of stock picking, probably not worth it if you have a full-time job otherwise. If you are looking for capital preservation to some extent, consider investing into bonds (especially TIPS). As the others have noted, there are a few flaws in this strategy regarding what you're actually growing vs. just redistributing when a dividend is paid out. 
2. There's a whole subsection devoted to real estate, may want to post specifics there. You will need a lot of data to support a business plan in real estate.
3. Sure, make sure you want to remain 100% VTI, but that seems fine once you leave and will decrease fees to some extent. 
4. A lot of people go on ACA plans if they are reasonably healthy.