Matthew O. Jacobs - Beginners Guide to Dividend Investing 2020: How to Retire with Dividends

Matthew O. Jacobs

Beginners Guide to Dividend Investing 2020

How to Retire with Dividends

2020 Matthew O. Jacobs

All rights reserved. No portion of this book may be reproduced in any form without permission from the publisher, except as permitted by U.S. copyright law.

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W elcome to your guide to taking your first steps in Dividend Investing. If you never done it before, investing in shares and earn dividends might seem difficult to understand, so in this guide I will share with you my knowledge and experience regarding stock market investing as well as insights and expertise from the world most successful stock market investors, to make it simply easier for you to start.

The most common question all beginners ask before they even reconsider the thought of stock market investing is Why invest in the stock market? Simple answer to this question is that investing gives you a great opportunity to gain your financial freedom and build your wealth through dividends. Stock market investing gives your money the potential to grow fast!

There are many reasons why people invest in stock market, as well as from my experience I can tell you the most common examples: Build wealth for financial freedom and provide passive income.

The next thing beginners want to know is when is the right time to start investing in stocks? Am I being late? The answer is Now! Now is the right time! The sooner you start investing the more money you could make in the long term. Regarding 2020 Market crash, now is definitely the best opportunity to start investing in stocks and it is definitely worth it!

Note to the Reader : This book will not tell you how to beat the market. No truthful book can. Instead, this book will teach you simple and powerful lessons how to make money with investing in stock market:

how it all works and what are the first steps you need to take to start investing in the stock market;

how you can maximize the chances of achieving long-lasting gains, what are the best strategies for your success;

how you can control the self-defeating behaviour that keeps the most Investors from reaching their full potential.

In this book you will learn that Stock Market Investing and earning dividends is the best and easiest way to Passive Income and Financial Freedom.

Following these simple steps that have been distilled from the world most successful stock market players, I promise you that you and your family will win this game and I assure you that you will win big!

Second note to the Reader : You should bear in mind that you do not work for your money, let your money work for you! Remember, the moment is right now!

Chapter 1
Dividend Investing Basic Ideas

T he basic consideration is that in recent years the benefits provided by the statutory pension insurance have steadily decreased and will continue to decrease. The retirement age has been raised to 67 years and pension increases are often not enough to at least compensate for the inflation rate. The resulting pension gap must be closed somehow.

Because of the population structure, I don't expect the situation to improve, but rather further reductions. I distrust all systems in which the state has a hand. I even go so far as to say that our politicians will reduce the statutory pension to a basic pension if sufficient income is generated by a supplementary pension. That is why I believe it is essential to take action ourselves, while maintaining the greatest possible flexibility. The aim must therefore be to create passive income in order to ultimately enjoy financial freedom. Financial freedom does not necessarily have to be achieved only at retirement age. Surely it would be wonderful not to have to work from the age of 40 onwards. So it does no harm to start saving as soon as possible in order to be able to make a living from the earnings. In the end, it is important to define a goal. If you know where you want to go, a plan can be drawn up to achieve this goal.

The goal

Everyone must decide for themselves how much they need to live, depending on their own standard of living and their own demands. Whether this is 500 $/month or 5.000 $/month is ultimately irrelevant. It just has to be realistic and achievable. After analysing my own situation and maintaining my current standard of living, my goal is to have a high passive income at retirement age (preferably earlier).

The plan

Like a long journey with a fixed destination, you have to plan it to arrive. What are the options? Car, bus, train or plane? The question is also how do I reach my financial goal? Savings book, bonds, stocks or real estate?

In my opinion, participation in productive capital, i.e. shares of different economies, is the right way for me.

Since the implementation should only be based on a manageable amount of time and I intend to use my free time for other purposes, the investments should be "self-runners" if possible.

As a basis for calculation, I assume an initial net return of between 2 % and 3 % and an annual increase in the dividend of between 10 % and 20 %. In order to keep the risks within limits, I have set myself a maximum of 50 individual values, i.e. each investment represents 2% of the desired investment of 10,000 $. In the long term, each company should bring me at least 20 $ net per month. In order to achieve my goal, a high savings rate and a reallocation from other investments is necessary, especially at the beginning.

I prefer American companies because they usually pay out dividends quarterly. This is primarily for psychological reasons, I simply find it more pleasant to receive a dividend several times a year than just once.