To be a successful investor, one needs to manage his or her
expectations. What kind of results are you seeking?
Some people expect instant results. If they buy a stock and it
doesn't go up the very first day they own it, they're disappointed.
Others are more patient, watching and waiting for good long-term
investment ideas before acting. Still others will never actually
put any money to work, and don't get much further than doing a bit
of initial research. All of these people likely had some
preconceived notions about investing that led them to where they
are today. I believe that a person's mindset is extremely important
in determining their level of success - not just in investing, but
in their career and personal lives as well.
In my newsletter, I try to make investors aware of all the
factors involved in generating wealth. I'm not here to simply tell
people that dividend stocks have outperformed the overall market
averages for decades, or how incredible compound interest is for
investors who consistently put money to work over time. I like to
closely examine the various influences around us at different
stages of our lives, and how they affect our spending and investing
I urge you to remain open-minded about all money matters. Always
be willing to learn more, and don't be afraid to reconsider a
previously-held viewpoint when new evidence emerges. Also bear in
mind that our careers, savings, spending habits, and investing
lives are all intertwined.
Success is often defined by money, and despite the fact that
money doesn't buy happiness, the truth is that money can often lead
to great opportunities to better your overall life. When you build
a solid financial foundation, you'll avoid much of the everyday
money stresses that plague so many people. Plus, you'll be able
afford the finer things in life - whatever those things are for
Once your financial "house" is in order, you should then seek to
stockpile as many income-producing assets you can afford to buy
with cash and debt. Of course, debt should only be used sparingly
and carefully. For instance, I'm a big fan of income-producing real
estate properties, and only borrowing money when a property can
carry itself with positive cash flow. Regardless of the investing
focus, your mindset should remain the same. Remember, every money
decision you make affects the other components of your financial
We can all fuss about the size of our bank accounts, our job
that is making us miserable, or other factors holding us back. Or,
we can make the changes necessary to improve our "luck."
Ultimately, your current luck in life will be built upon the
actions you take, and a solid frame of mind is a critical piece of
April 17th IRA Contribution Deadline: Last Reminder!
One of the best long-term retirement strategies an investor can
use is investing in dividend-paying stocks within a Roth IRA. Roth
IRA distributions, including capital gains, interest, and DIVIDENDS
are tax-free once you turn 59 1/2 years old, and the account has
been established for longer than five tax years. Dividends paid
into a Roth account are never taxed, even when withdrawn. This
special treatment differs from dividends accumulated in a
Traditional IRA, which would be taxed during withdrawals. The best
part of a Traditional IRA is the tax credit is counted the year you
Some accountants prefer clients to take the traditional road,
knowing it can ease one's tax burden for this year. Do remember,
though, that withdrawals taken from any IRA account before age 59
1/2, including income from dividends, are subject to a 10 percent
penalty tax in addition to ordinary income taxation.
Always consult with a tax specialist before making any moves
that may incur tax consequences. Of course, there's nothing wrong
with purchasing dividend stocks within a Traditional IRA either,
but Roth IRAs are particularly attractive to dividend investors
looking to maximize their future retirement withdrawals.
For those of you who are self-employed, you have the benefit of
building a retirement nest egg very quickly with a SEP-IRA. If
you're self-employed, you can contribute 25% of your earned income
or $50,000, whichever is less, to a SEP plan for 2012. Think of all
the high-quality dividend stocks you can be putting to work for
yourself - that's the true essence of making your money work for
you! Again, talk to your tax professional and see how you can take
advantage of this type of account.
Call your broker and find out what you need to do to make sure
you can get your IRA contribution over to them in time to beat the
Go Beyond This Newsletter
We know many of you enjoy reading the daily newsletter, but
remember that with our
service, the newsletter is just one small component of what we
offer. Here are the "Big Three" benefits of our Premium
Best Dividend Stocks List
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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!
Thank you for sharing part of your weekend with me, and please
be sure to pass this post on to anyone you think we can get
inspired and educated about money, building wealth, and using
common sense to do so.
Be sure to visit our complete recommended list of the
Best Dividend Stocks
, as well as a detailed explanation of
our ratings system here