Spain banking concerns added to recent investors' fears this
morning, with the markets once again opening sharply lower. The
markets staged a late-morning comeback (as news began to spread
Greece would be receiving further relief - i.e.m another bailout of
some sort), but couldn't come full-circle as the averages ended in
the red. As usual, we'll be looking closely at some potential
portfolio shifts (subtractions, additions) where we see fit.
The recent volatility we've been seeing in the markets could be
a sign of things to come this summer. Volume tends to be much lower
during the summer months, with money managers on vacation. Hence
the importance of owning high-quality dividend stocks, which have
large long-term shareholder bases and offer a haven from the manic
price movements of growth-oriented names.
Looking at today's big movers, earnings results caused some
investors to trim shares in the likes of Mercadolibre (
), Agrium (
), Macy's (
), and Teva Pharmaceuticals (
). On the flipside, shares of Walt Disney Company (
) and Toyota Motor (
) attracted some buying on their earnings reports. Meanwhile, Wall
Street analyst downgrades pushed down shares of CF Industries (
) and Ace Ltd. (
). Finally, Gold (
) prices continue to meander despite the murky global economic
picture. Warren Buffett's bearish opinion of gold as an investment
this past weekend is holding up.
How's Your Retirement Picture?
Here's some eye-opening retirement data I recently came
- Americans 10 years away from retirement have saved just
$78,000 on average, even though the Employment Benefit Research
Institute says the average worker will need to have saved $900,000
to maintain his or her lifestyle after retirement at 65.
- The average American has saved just 7% of what he or she hoped
to retire on.
- 25% of middle-class Americans now say they plan to work until
- The Center for Mature Consumer Studies at Georgia State
University reports that the average boomer has assets of just 10 to
15 percent of what their parents had - and far more debt!
If you find yourself falling into the categories mentioned
above, don't worry yourself sick about it. A few simple changes
will set you on the right track.
Start cutting debt immediately, especially high interest debt
(credit cards, etc.). Keep your living expenses as low as possible,
so you can free up money every month that can then be invested into
income-producing assets (dividend stocks). The power of compound
will be your greatest ally in generating long-term wealth.
If your home is your biggest expense as you near retirement,
think about downsizing or even relocating to an area where the cost
of living is much lower. Taking on a part-time job can also help
pad your income and even provide health insurance (yes, some
companies provide benefits even for part-time workers).
Remember, the retirement picture hasn't suddenly started
deteriorating overnight. We've been seeing gloomy data for years
indicating how poorly-prepared Americans are for their later years.
You won't find much help from the business media, as the experts on
television are mainly concerned about which stocks will work for
the next morning or the next earnings report.
To be successful in long-term investing, you need a plan. Let's
take a look at some of the basics that any financial plan should
include. First of all, you must have ultimate goals in order to put
together a financial map to follow. Understand your risk profile
and where you are in life, in relation to what the top-line goals
are. For example, if you are afraid to take on much risk in your
later years, you could consider taking on less exposure to
The key thing to remember about a financial plan is to be
flexible. Your life changes, and so should your plan. There is no
reason to roll the dice if you're about to cross the finish line
with a great record to show for it. Greed can often get in the way
of using smart financial sense. As families come into play, you'll
eventually need to consider your estate situation, identifying the
beneficiaries for specific holdings, and make sure you have enough
insurance to protect your loved ones. Make it a habit to perform an
annual evaluation of where you are financially, as well as the
situation regarding the economy and how that could affect your
investment holdings. You can also work with a financial planner
that is cognizant of these factors. When working with a planner,
holding information back is never a smart thing. Don't ever let
pride get in the way of you or your family's financial
A good financial planner will help you construct your short-term
and long-term goals, analyze where your money is currently being
spent, as well as figuring out where you may want to look for
investment ideas that fit your risk profile. Too many marriages
fall apart as a result of money issues. Having the guts to lay your
cards on the table and see what needs to be done can help avoid
further financial hardship that a marriage split will certainly
At the end of the day, taking financial responsibility and
knowing what you can afford to do is essential. I talk about
investing in quality dividend-paying stocks as a great way to build
up your future income, but if you are spending like there's no
tomorrow, then you risk negating all the good you've done on the
investment side of things. We'll continue to do our best at
Dividend.com to help you find new income sources you can begin to
build or add to positions in, but the rest of your financial health
will depend on some of the things I mentioned above. Get to it as
fast as you can and you'll be happy you did.
Special Players Have Bad Games - But Not Very Often
Even the best athletes sometimes put in some bad performances.
It's impossible to play at an extremely high level in every single
game. Similarly, as investors, we need to understand that not every
stock we buy will be a home run. There are bound to be some duds
along the way.
If you study your investing mistakes closely, you'll likely
avoid the same missteps in the future. Thus, your overall
performance will remain remarkably consistent year after year.
Failure is a natural part of any ultimately successful process.
It's impossible to be perfect. The key is sticking with your game
plan and trusting your investing skills.
On Wall Street, you'll hear about how many of the greatest
traders who rose and fell over time. Their manic approach is quite
different from our message here at Dividend.com. We tend to avoid
the all-in and all-out timing calls that can make or break the best
of traders. We also accept the fact the markets will sometimes toss
us a curve ball that requires us to make adjustments. We don't
hesitate to make those difficult calls when the situation warrants
- and neither should you.
An Important Note Regarding the Best Dividend Stocks List
We want to make sure everyone understands that the stocks on our
Best Dividend Stocks List
are the names we currently like for new investor capital,
regardless of what date the stock was first recommended on. If and
when a stock is removed from the list, we will clearly state
whether the stock should be sold (which is rare but occasionally
will happen), or simply held in one's account until we see a better
entry point or catalyst.
And here's one last thing to remember about what we do here at
Dividend.com: it's not just the names that we recommend that can
help you build wealth, but also the things we try to steer you away
from that are just as important. Forget about speculative or penny
stocks, chasing unprofitable IPOs, and listening to the manic
talking heads in the business media!
Beat The Markets with Dividend Stocks
eBook Has Arrived!
We just debuted our brand new 275-page eBook, exclusively on
Dividend.com! In this digital-only book, we look ahead to 2012 and
the main factors that could affect dividend investors. A $39.95
value, the eBook is a
Beat The Markets with Dividend Stocks
contains a full economic forecast for 2012, including in-depth
analysis on 65 of the biggest dividend stocks out there. It's a
great way to get prepared for your investing next year! So head
over to the
Dividend.com Premium homepage
now to download your copy.
A Dividend Capture Strategy for Active Investors
We now offer complete U.S. dividend data for all
members, so anyone that focuses on "Dividend Capture" trading
strategies should have plenty of good stuff to research each day.
Just check our enhanced
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Speaking of dividend capture, Dividend.com Premium members can
also access a 9-page report we published on the essential elements
to any successful dividend capture strategy. Be sure to check it
out here on the
Dividend.com's Very Own National TV Commercial Has Debuted
Our first-ever television commercial! has started running on
CNBC and the feedback has been wonderful. If you haven't seen the
you can check out our commercial here
Thanks for reading everybody. I'll see you tomorrow!
Be sure to visit our complete recommended list of the
Best Dividend Stocks
, as well as a detailed explanation of
our ratings system here