How I Made Stock Investing Work for Me
In my home, there is barely enough money to cover the bills and grocery needs. So, when things need to be repaired or updated–I have always had to take out a loan. Then, it just made this vicious cycle worse. Because, on top of my regular bills, I had loan payments to make.
I just couldn’t seem to get out of the spinning wheel of financial depression. So, I started looking for ways to make extra income for needs such as home projects. I came across a Timothy Sykes interview on stock trading. I thought, this was something I could do.
And, I started investing for dividend income. Here’s how.
Research Stocks that Pay Consistent Dividends
With a bit of research, you can find a large number of stocks that pay steady dividends. Dividend stocks pay out a portion of company profits at consistent intervals. So, if you start with one dividend stock, you will get a small pay out. This is sort of similar to profit sharing.
The company will send you payments based on the number of shares you have. The more shares you have in one dividend-paying company, the more money you will get.
My goal was to get enough stocks to eventually make a small monthly side income.
Look Up a Company’s Earnings Per Share
All you have to do is look at their annual report on their website. Then, look at their dividend per share. The dividend per share should not equal more than 80 percent of its earnings per share.
You want to ensure you make enough to start saving for home projects such as updating your kitchen or fixing the roof.
Think of How Much You Can Afford to Invest Each Month
Even if you think you can’t afford to invest, it is important to find a way. You might have no more than $50 to invest each month. Even if you can only invest $20 each month, that is better than nothing. You might save it up until you have enough to buy the dividend stock you prefer.
Think of this as a long-term portfolio. With dividend paying stocks, you can also buy partial shares so you don’t need to buy an entire share at once. You can also direct the company to reinvest your dividends into more shares.
Then, just leave it alone and let it grow. It will be just a matter of time before you have extra income for renovating your bathroom or adding a deck to your home.
I’m glad I started investing now rather than later. The sooner you invest, the more you can make. If you bought $1,000 shares of a stock that pays a $.40 dividend every quarter, then you would make $400 per quarter. In 10 years, that amount could go up to $16,000 per quarter.
When you invest, you get to decide how much to spend on the stock of your choice. Investing is easy to put off, but once you see the rewards–you’ll want to keep investing.