Author Topic: VTSAX vs Dividend Stocks  (Read 2707 times)

BTDretire

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VTSAX vs Dividend Stocks
« on: September 06, 2015, 08:39:30 AM »
Hi all,
 I'm 60yrs young with the following portfolio about 64% invested in VTSAX,
about 13% in dividend stocks, 12% in a land contract,
the remaining 11% in interest bearing accounts.
  Most of the dividend stocks (60%) are REITs, paying very high dividends
and therefore a bit risky but, I think they have taken most of their hit already,
actually doing well with the market down for the year and generating 12% dividend.
 The others 40% is in paper, bank, and tech, pay about 6%.
 I'm trying to decide if I should get into more dividend stocks.
If I did, it would not be in these high payers, it would be in what are
called 'The Aristocrats', stocks that have paid an increasing dividend for
25 years or more. They generally only pay 1% to 6%, but can also be
expected to have price appreciation. If interested Google dividend aristocrats.
Here are the 52 S&P 500 Dividend Aristocrats, there are others,
http://www.buyupside.com/dividendaristocrats/displayalldividendaristocrats.php
 Now, the confusing part, as if I'm not already confused, I'll be retiring it
18mo or less, my wife probably 5 to 10 yrs. Since her income will be enough
to live on, I already question the idea of dividends.
 I started dabbling with individual stocks for fun and got lucky with several
even through this downturn, I'm good, but I don't need the dividend income.
 So, I have about 11% in basically cash, when this downturn settles,
I'd like to put the little soldiers to work, but where?
VTSAX or income stocks?

I find writers saying dividend stocks out perform the S&P and
writers saying just the opposite, but I haven't found how they are
calculating different.


Seppia

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Re: VTSAX vs Dividend Stocks
« Reply #1 on: September 06, 2015, 09:01:44 AM »
I personally like to do a bit (a bit) of stock picking, a habit I started in Europe where I didn't even know what vanguard was.
Since here in the U.S. I have switched to mostly index and 401k, but I enjoy some individual stocks with my spare money, it satisfies my irrational need for market timing.
To minimize risk I own mostly S&P 500 aristocrats (Exxon, coca cola and P&G represent approximately 60% of my individual stocks), and try to buy them when they're low.
I personally think that buying the largest oil company in the world at 5 year low prices can hardly be a bad idea in the long run

BTDretire

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Re: VTSAX vs Dividend Stocks
« Reply #2 on: September 06, 2015, 09:23:19 AM »
I personally like to do a bit (a bit) of stock picking, a habit I started in Europe where I didn't even know what vanguard was.
Since here in the U.S. I have switched to mostly index and 401k, but I enjoy some individual stocks with my spare money, it satisfies my irrational need for market timing.
To minimize risk I own mostly S&P 500 aristocrats (Exxon, coca cola and P&G represent approximately 60% of my individual stocks), and try to buy them when they're low.
I personally think that buying the largest oil company in the world at 5 year low prices can hardly be a bad idea in the long run

  I certaily have been watching oil stocks, not sure which is the largest, (easy to find)
XOM (3.96%), CVX (5.47%) and BP (?) are the ones I'm watching, but the divi on
CVX (5.47%) pushes me that way.
Ah, largest is XOM?
 I suspect a mix of VTSAX and dividends stocks would be a bit of comfort in any market downturn.
A person could always cut back on spending live on divi's until market comes back.

Seppia

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Re: VTSAX vs Dividend Stocks
« Reply #3 on: September 06, 2015, 09:29:58 AM »
Personally the only two oil stocks I would own are Exxon and Royal Dutch, as they are the two largest oil companies in the world and known "buyers" who have a close to zero risk of being bought themselves.
RD is also at a 5 year low by the way.

BTDretire

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Re: VTSAX vs Dividend Stocks
« Reply #4 on: September 06, 2015, 09:54:39 AM »
Personally the only two oil stocks I would own are Exxon and Royal Dutch, as they are the two largest oil companies in the world and known "buyers" who have a close to zero risk of being bought themselves.
RD is also at a 5 year low by the way.

RD also known as Royal Dutch Shell plc (RDS-A). Anything special about the plc or RDS-A,
that makes it different to own?

Seppia

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Re: VTSAX vs Dividend Stocks
« Reply #5 on: September 06, 2015, 12:37:02 PM »
Currency.
You can buy Royal Dutch:
In US dollars

In GBP

In euros