Preface
It was a eureka moment.
I was working on a dividend spreadsheet, changing the variables, when the size of the numbers I saw surprised me. I realized that if my kids’ money was invested according to the formula I was working with, they should never have any financial problems in adulthood, no matter what job or career they chose.
I also recognized that using the same formula, my wife and I should never have to worry about income in retirement.
And last, I understood that if my parents invested according to the formula, they, too, should have no worries about income in old age.
That's when I knew I had to write this book.
Get Rich with Dividends is for the average investor—the investor who is just getting started, the investor who is playing catch‐up, the investor who has been burned by the booms and busts of the recent past, and the investor who trusted the wrong advisor and ended up paying thousands of dollars for worthless advice.
This book is for all investors who are serious about creating real wealth for themselves and their families, investors who are willing to learn a simple system for making their money work as hard as they do (or did). It's easy to learn and implement and takes very little free time. Importantly, it's not a theory. It's been proved to work over decades of bull and bear markets.
And it's designed for investors who have other things they'd rather do than spend hours on their portfolios. Implement the 10‐11‐12 System and let stocks and time work their magic. All that's required is the occasional check‐in from you to make sure the companies in your portfolio are still behaving the way you expect them to. If they are (and you'll learn how to pick companies that are most likely to meet your expectations), no further action is necessary.
As the editor of the Oxford Club's Oxford Income Letter, I receive emails every month from investors who are yearning for higher yields. Current yields aren't cutting it for many retirees. I was inspired to find a strategy that would ensure investors wouldn't be in the same boat in the future as today's income seekers, who are taking on too much risk by chasing yield.
The 10‐11‐12 System outlined in Get Rich with Dividends will enable investors to achieve yields of at least 11% (and possibly much more) in the next 10 years—all while investing in some of the most conservative stocks in the market. These are companies with track records, some decades long, of taking care of shareholders. And if you don't need the income today, 12% average annual total returns (which crush the stock market average) are easily attainable. If your money earns 12% per year, it will more than triple after 10 years, quintuple after 15 years, and grow by well over 10 times after 20 years. In other words, earning an average of 12% per year for 20 years turns a $100,000 portfolio into nearly $1.4 million. And that's with no additional investments.
What would an extra $1.4 million mean to you in retirement? First of all, it might spin off enough income that you wouldn't need to touch the principal. The money could be used for vacations with your family or a grandchild's college education, or it could give you peace of mind that you'll always have the best medical care.
Perhaps most importantly, you'll learn how my 10‐11‐12 System can still enable you to earn significant yields and double‐digit returns in flat or down markets. Despite the nastiest bear market, you'll be sleeping comfortably, even smiling, once you implement my 10‐11‐12 System.
As you make your way through this book, you'll learn everything you need to know to become a successful investor. It's easy to read and even easier to get started.
In Chapters 1 and 2, we go over why dividend stocks are the best kind of investment you can make for the long‐term health of your portfolio. Since you don't want to invest in just any old company paying a dividend, we discuss the special kind of stocks that you should select and how to find them.
I don't expect you to simply take my word for the claims I'm making, so in Chapter 3, I show you how I arrived at the various numbers, taking you through examples of how your income and total return can grow every quarter, with an example of how the 10‐11‐12 System still works and even thrives in bear markets.
In Chapter 4, we look at the big picture and the reason companies pay dividends. You'll understand why it's an important factor in determining the health of a business.
You'll see why certain conservative stocks are your best bet in Chapter 5. There's no reason to take excess risk to achieve your goals when some of the most conservative stocks on the market will achieve better results.
Chapter 6 discusses some interesting types of stocks you may not be aware of—stocks that typically yield more than regular dividend payers.
In Chapter 7, we lay the foundation for your portfolio, and then Chapter 8 is where you'll learn all about the 10‐11‐12 formula that you'll use to set you and your family up for long‐term, double‐digit yields and returns.
In Chapters 9, 10, and 11, we go over dividend reinvestment plans, options, and foreign stocks—all ways to turbocharge your returns.
Chapter 12 is about everyone's favorite subject—taxes. Even if you use a CPA to do your taxes for you, be sure to read Chapter 12, as there is important information that can make your investments much more tax‐efficient.
Chapter 13 covers “dividend” paying cryptocurrencies. Some readers may feel that if a cryptocurrency pays a dividend, it must be safer than other cryptos. I detail where these dividends come from and whether or not they are smart investments.
And we wrap it all up in the conclusion and set you on your way to a lifetime of market‐crushing returns and nights of worry‐free (at least about your portfolio) sleep.
The strongest endorsement of the 10‐11‐12 System that I can make is this: I'm using it for my investments and for my kids’ money as well.
Writing this book has been a labor of love because I know there will be thousands of families who will achieve financial freedom, be able to send a kid to college, make a down payment on a house, and enjoy retirement as a result of following the 10‐11‐12 System.
I'm glad yours will be one of them.
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