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Staying cool, minus the air-con

My goal is to “retire” early in a few years and just work part-time or do online stuff a few hours a week. To reach this goal, I do three things: 1. Invest my money in dividend paying stocks. 2. Build Passive Income Streams, like Squidoo. 3. Live frugally, so that I have more money to do #1. Part of living frugally in Korea in the summertime is living without an air-con in my apartment,…

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Ethical Investing

When I talk to friends and acquaintances about investing and personal finance related things, one of the questions that I’m often asked is about what kinds of companies I hold stock in. I list things like Mcondalds, Chevron, Pfizer and Wal-mart and one of the comments is inevitably, “Those companies are evil and harmful to the world!” My short answer is that nothing is black and white and that the world I live in is…

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Real Estate or Stock Market Investing?

I was just listening to the Suze Orman Show on Podcast and she was talking about how she prefers stocks to real estate when it comes to investing. I most definitely agree with her, and my reasoning is exactly the same as hers. By real estate investing, I’m not referring to the house that you live in, but additional ones that you buy and rent out to others. When you have real estate, it comes…

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The Rule of 72

A simple way to estimate the time it will take for a sum of money to double is to use the rule of 72. Basically, you divide 72 by the interest rate, per year and the result is the number of years it will take for your money to double. For example: $10 000 invested at a 3% interest rate will take 24 years to become $20 000. Invested at 8%, it will take 9…

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How often I look at my portfolio

I’m a long-term investor, which means that I’m more worried about what my dividend stock portfolio is going to look like in 10 or 20 or 30 years from now than I am about it in this current year. I know that there are lots of people who look at the market news and their brokerage account every single day and are paying attention to even little fluctuations in value. I would consider many of…

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Stocks are at record highs: what I’m doing about it

The stock market indices such as the Dow Jones Industrial Average and the S&P 500 are at some record breaking highs. At times like this, people often get into a frenzied like state and throw money around trying to get in on the action. What am I doing about it? Basically nothing. Although I do have a good amount of cash sitting in my bank account here in Korea earning 2% interest or so, it…

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Payout Ratio

One of my favorite metrics that I use when determining which dividend paying stocks to buy is the payout ratio, which according to Investopedia is: “The proportion of earnings paid out as dividends to shareholders, typically expressed as a percentage.” It’s maybe helpful to think of it as similar to finances on a personal level. You have some money coming in each month and you can either spend or save it. Maybe you spend 50%…

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May 2014 Passive Income Report

This month, I earned $310.41 in passive income. Everything was pretty normal except for my Iherb earnings, which increased significantly to $24.99, mostly due to their free shipping special for most of May. Anytime I can earn over $300 for very little effort on my part is good news! Here’s how May 2014 compared to previous years. May 2013: $386.06 May 2012: $380.02 May 2011: $243.11 May 2010: $49.22 Please like & share:

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How much income?

One of my friends recently asked me about how much money I would need to invest to earn a certain amount of money each month. It’s actually quite easy to explain, but the actual calculations are a little bit complicated. I invest in dividend paying stocks and ETFs that pay a certain amount of money out in dividends/year. I hold some things on the lower end, such as VWO (Vanguard Emerging Markets ETF) at 1.2%…

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How to Buy Stocks: A Simple Explanation

how-to-buy-stocks

How to Buy Stocks: Explained Simply  I get a lot of questions from my friends and readers of this blog who are new to the investing world about how to buy stocks. There are a few options for buying stocks, but the one I like the best (by far) is using an online discount brokerage. You can go with a full-service brokerage, but they are far more expensive and also quite unnecessary. Full-service brokers help…

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Dividend Reinvestment

When you have dividend paying stocks in your portfolio, you get a share of the earnings paid back to you in the form of a dividend, usually around 3-4 times/ year (although it ranges from monthly to annually). They will automatically be added to your stock brokerage account and will impact the positive (you don’t have leverage), or negative balance (you are using debt/leverage). The exception to this is if you have an automatic dividend…

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Passive Income Report: April 2014

My passive income for the month of April 2014 was $274.64. You can see the breakdown of that in this Passive Income Report, as well as compared to previous months. Here is the data from previous Aprils: April 2010: 5.29 April 2011: 214.34 April 2012: 328.1 April 2013: 251.97 Overall, this month was a bit lower than other years due to decreased dividends. This year, March was a huge month for dividends, so it was…

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Invest like a Grandma: Dividend Stock Investing

There are a million and one things to invest in that are far sexier than Dividend Paying Stocks. A quick list off the top of my head: IPO’s, options contracts, shorting, commodities, emerging markets, Bit coin and day trading. A lot of these things can actually make you a lot of money IF you know what you’re doing. And while I know the basics of most of that stuff, I’m certainly no expert and would…

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Stock Market Pyschology: Greed and Fear

When it comes to how psychology relates to the stock market, there are 2 emotions that dictate most individual investor’s decision: fear and greed. The so-called “Smart-Money” (hedge fund/mutual fund managers) should be making better decisions than the individual investor, but not always. Fear is rampant when the stock market is in fast decline and it leads people to do crazy things such as sell when stocks have hit their lowest points (ie: the crash…

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What’s in my Portfolio: Industrials

I have a few holdings that fall under the category of “industrials” and I love them because they just seem to plug along, making me money off dividends, increasing their earnings and causing me no stress or worry. Exactly the kind of companies I want in my portfolio. 1. Boeing Airlines(BA): 2.7% of my portfolio. Although they’ve had some problems in the past few years with their new airplane catching on fire, etc, they’re still…

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Trading vs. Investing

I’m an investor, which means that I invest my money in the stock market for the long-haul and don’t really care about the short-term fluctuations in the market. I lose no sleep if there is a crash and actually feel quite happy because I can pick up stocks that I want cheaply. Trading, on the other hand is for the purpose of making money off the fluctuations in the market. You can make money when the…

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What’s in my Portfolio: Consumer Staples

I have a few things in my portfolio that are kind of hard to classify, so I’ve just included them under the category, “Consumer Staples.” They are things that consumers buy, usually habitually and over long periods of time. 1. Kimberly Clark (KMB): 4.8% of my portfolio. Everyone uses things from this company: tissues/feminine products/baby stuff, etc, which is basically the reason that I bought it. This company is one of the most “recession-proof” companies…

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Frugal Living: lifestyle creep

I’ve lived in South Korea, working as an English teacher for almost 10 years. For the first 7 years or so, I lived extremely frugally. Like, I always rode public transport and tried to avoid taxis, didn’t have a smart-phone, stayed in the school provided housing and had no pets. And like I would really consider it seriously any time that I spent more than about $5. My weakness was travel, but I almost always…

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What’s in my portfolio: ETFs

ETFs are basically an alternative to mutual funds that have emerged in the past 10 years or so.  Instead of active management like a mutual fund, they follow the passive approach.  That is, they just follow and index of some sort, such as the S&P 500 or only buy a certain type of bonds or something like that.  They can help a dividend stock investor by providing much needed diversification and it’s a much better…

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What’s in my Portfolio: Financial Stocks

Financial companies get a bad rap- often for good reason The whole financial sector gets a bit of a bad rap from the press, investors as well as the general public and for good reason: ridiculous compensation packages/poor financial management/extreme risk-taking/government bailouts.  However, it’s too big of a sector to overlook and the key is looking for the less-risky companies that have a proven record of good management. Here are the financial stocks in my…

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OT at the day-job vs. Passive Income Building

One of the big debates that I have in my head all the time is whether to work more at my day-job, or whether to spend more time building up my passive income streams  through things like building niche websites, self-publishing books and HubPages. My job at a Korean university is kind of ideal actually because according to my contract, I only have 9 teaching hours, although I usually get forced to do 11 or…

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Passive Income Report: March 2014

For my February report, please see this post. But, onwards to March.  You can see all the details here, but the total minus interest paid to my broker was $466.44 US.  The large majority of it was in Dividends, and a big portion of that was NPK (National Presto Industries), which paid a special dividend of over $100. Compared to previous years: March 2013: 251.97 March 2012: 455.72 March 2011: 156.86 March 2010: 7.02 Similar…

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What’s in my portfolio: Tech

I’ve talked previously about my pharmaceutical holdings as well as the oil & gas companies that I hold.  You can also check out my complete portfolio, but today I’m going to talk tech. AAPL (Apple): 5% of my portfolio.  Check out the Dividend Monk’s AAPL report. INTC (Intel): 2.5% of my portfolio.  Check out the Dividend Monk’s INTC report. Tech companies are generally thought to be the high-flyers, which means that they often warrant a…

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