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NMX*Dividend Machine - How to Reach Absolute Financial Security

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Hi, my name is Bill Spetrino, and I found a way to have America's largest companies completely fund my retirement. In fact, they have done so ever since I turned 42 years of age.

What's amazing is that I have never made a six-figure salary . . . yet, I reached millionaire status long ago. And currently all of my living expenses are paid for, plus some!

I live a life that most envy.

So, how did I do it? And probably more important for our readers, how can they garner a 100% annual return, and what tip can I give them that will add an extra $175,000 to their retirement accounts?

Let’s get started . . .

Implementing my 18-point proprietary system has allowed me to achieve the lifestyle I have.

We don't have time to go over all of these today, but here are three cornerstone rules to follow that will go a long way! I am going to go over these quickly, so pay close attention, and I would encourage you to take notes.

Rule No. 1: Find Warhorse Stocks That Pay You

See, 150 years ago, companies paid you money.

Investors didn't watch their stocks go up and down in value every day. Heck, they didn't even do that on a quarterly basis. They just wanted to make sure the companies they owned paid them cash.

Nowadays, people trade stocks on their cellphones based on a rumor they heard on the subway from an inexperienced broker who just passed his Series 7. This kind of easy access to trades has made the market volatile.

But you have to ignore that volatility, and you do that by owning companies that retain their value and pay you money.

There are several companies you can buy today that survived world wars, depressions, recessions, the tech bust, the real estate crisis, and more . . . and they still pay you to own them.

I am talking about companies like Coca-Cola.

Read More: Discover How You Can Become “Rich By Friday” with The NMX*Dividend Machine

A lot of these companies don't really seem to pay much. Coke pays about a 2.5 percent dividend . . .

And at first sight, you are right.

And that brings me to the second point

Rule No. 2: Find Stocks That Regularly Increase Their Dividends

This is incredibly important, so listen closely.

We will use two fictional characters — Bob and Tom — to illustrate this.

Bob and Tom each have $10,000 to invest, and they each find a $10 stock that pays a 5% dividend, or 50 cents, annually. That is a pretty nice dividend to take home.

Their stocks both increase in value at a 6% clip per year . . . so 30 years later, they are both valued at about $60,000.

That's great. Now let's look at the dividend payments.

Bob's stock keeps paying that 50-cent dividend. It never wavers. So over the course of 30 years, Bob collects $15,000 in dividend income.

That is pretty awesome.

So when you add up the dividends paid out and the value of the stock, Bob's $10,000 investment is eventually worth just shy of 75 grand.

Now let's look at Tom.

Tom's stock actually increases its dividend at 6% per year in order to keep up with the increase in the stock's value.

Sure, a 6% bump in year one means Tom's dividend merely goes from 50 cents to 53 cents. No big deal. But guess what — by year 30, Tom is collecting a whopping $2.84 per share.

Now this is where most people get fooled. Because 30 years from now, the average person will look up that company on his fancy-pants iPhone and he will see that the stock pays a 5% dividend.

What that average person doesn't see is that Tom bought that stock 30 years ago for 10 bucks, and that the dividend of $2.84 a share is actually a 28% effective annual yield for Tom . . . that's $2,840 per year from an original investment of $10,000.

So when you add up the dividends paid out and the value of the stock, Tom's original investments vaults up to $100,638.

That's about $26,000 more than Bob.

Read More: Discover How You Can Become “Rich By Friday” with The NMX*Dividend Machine

And yes, that's a 28% dividend. You probably think that no stock that can generate this type of return.

Actually, I already mentioned one: Coca-Cola.

This stock currently pays a yield of 2.77%.

But, let's say you bought $10,000 of this stock 30 years ago. The total dividend payout per year would actually be $11,190.

That's not in total, that is per year. So literally, every year you get paid over 100% of your original investment for holding a "boring" stock.

By owning these types of stocks, anyone can live with absolute financial security.

Several other stocks have done the same. I have a list of four that have done even better than Coke.

Hopefully now I have you convinced. It's important to follow rule #2 — pay attention to dividend increases. You may also be wondering how you can find information regarding the historical dividend payment.

It's easy. For example, Yahoo Finance allows you to do it. When you look up a stock, click on the "historical prices" tab, and then click on dividends. It will show you each and every dividend ever paid out in the history of the company.

But, if you think those returns are nice, you haven't seen anything yet, because I haven't even talked about my third rule of investing.

Rule No. 3: Harness the Power of Compound Returns

Say you have $10,000 and you make 6% on it. That is a $600 profit. Instead of spending the 600 bucks, reinvest it — or compound it — and keep doing that.

So, year 2, instead of investing just $10,000, you are investing $10,600. That small interest adds up real quick.

Let's bring back the example of Bob and Tom.

And let's assume they both reinvest their money by taking that dividend and buying more stock with it.

This really changes the results.

Over the course of 30 years, Bob's total return is $119,158.

Tom's total return — get this — Tom's total return balloons to $254,788. That's $154,000 more than he would have received if he didn't compound his returns.

And, since I know you will ask, if a person bought Coca-Cola 30 years ago and compounded those returns, they would be sitting on a whopping $513,000.

Yes, $10,000 turns into $513,000. It's amazing to see the returns grow.

And remember when I told you I would reveal how to make 100% per year off your investments?

Well, because Tom is compounding his returns by purchasing more stock, he now earns a whopping $10,192 a year from his original investment of 10,000 bucks.

So he is essentially making a 100% annual return each and every year at this point.

Bob, on the other hand, because his dividends did not increase, earns only $3,000 a year.
And what about the $175,000 tip I mentioned?

It's right there in front of you.

Many people may think they are investing the right way by purchasing warhorse stocks that hold their value.

But by simply looking at the dividend history and by compounding their returns, a person can amass roughly $250,000 instead of $74,693.

That is a difference of $176,095.

If you are interested in learning more about The Dividend Machine newsletter, and getting a copy of Bill’s special report Rich By Friday, click here.

To contact Newsmax Customer Service regarding The Dividend Machine, click here.

Read More: What Is NMX*Dividend Machine?


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Tuesday, 27 Aug 2013 10:28 AM
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