Yoda2000675

Yoda2000675 t1_j6brbem wrote

Reply to comment by codemonkey14 in I'M FUCKING BACK BOYS $TSLA by iefhno

Not with inflation. If you pocket your dividends every time instead of reinvesting; then you will end up making less as those stocks wont grow to keep up with it.

Companies only pay big dividends when they’re effectively done growing.

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Yoda2000675 t1_j6bm8zd wrote

Reply to comment by hbkx5 in I'M FUCKING BACK BOYS $TSLA by iefhno

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.

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