hbkx5 t1_j6beuoh wrote on January 29, 2023 at 3:09 AM

Reply to comment by Yoda2000675 in I'M FUCKING BACK BOYS $TSLA by iefhno

Yes and no, dividends are great to live off of and invest with. They would still have extra money from the amount they listed to invest and grow with if they pleased. If they live cheaply for the next 10 years of their life they could pay off a home and a car from the dividend. The remainder of their life could just be passive dividend money they mostly invest with.

Over the course of their life time (if they are somewhat young) It is a much better investment than most, however I do agree they should diversify. A mix between stocks for dividend, some stocks for growth, a small business with little to no maintenance / rental property, high interest hedge fund, alternative investments (something collectable that goes up in value over time, comics, lego's ect.), personal checking /savings / cash and finally a small amount of crypto (about 1% of total wealth) would be ideal IMO.

I am also big on generational wealth and building a better tomorrow for your descendants so that hopefully they can live a better life and in turn pass that wealth and tutelage on to their kids, so on and so forth.

Yoda2000675 t1_j6bm8zd wrote on January 29, 2023 at 4:10 AM

I just meant that they’d average out to get better returns by focusing on growth stocks and ETFs long term.

Dividend stocks tend to underperform just slightly because they generally aren’t going to grow much. Having dividends auto buy partial shares is by far the best way to use them and ends up avoiding the issue of dividend cash income being taxed at the rate of income tax rather than capital gains.