How To Invest $50,000 In The Stock Market (2018 Dividend Style)

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Let’s say I was just starting out with dividend growth investing in 2018, with $50,000 of capital (hypothetically speaking). It’s a unique time to start because the stock market is at all time highs. For this very reason, especially when starting out with larger capital investments (such as $50,000 or more), I would be incredibly focused on risk management and dollar cost averaging over time.

Importantly, today’s video builds on others in the same series. If you have not yet seen my videos on how to invest $1,000, $5,000, $10,000, and $25,000, you may want to check those out first (links to those videos below). Since I don’t want to repeat myself, as I know your time is valuable, today’s video offers net new perspectives for one investing $50,000. (Of course, my video has a dividend focus, as that’s my personal strategy.)

When investing $25,000 or less, I more or less would just go for it. I would want my dividend income to start building immediately. However, $50,000 is a serious amount of money. It’s a high enough sum that I would introduce some serious multi-year averaging. Today’s video discusses:

* The current state of the stock market. We are near all time highs. The market will correct at some point, in my opinion. As such, I would avoid a lump sum investment with this amount of money. Rather, I would average in over two or three years.
* That being said, my averaging schedule would depend on how much future capital I have to invest. If I have an incremental $1 million coming my way, for example, I would deploy my $50,000 faster. If I have $5,000/year to invest in the future, by contrast, I would average my $50,000 over a longer time period.
* Learn why dividend investing is the strategy of choice, especially in a late stage bull market. Buy low and sell high is going to be very difficult in this market. Investing for income (especially when averaging in) could work quite well.
* Learn why it’s going to require rock solid discipline to start investing $50,000 in 2018. One will need to be ready for the correction, and potentially short term “loss” of capital. That said, corrections are often the best time for dividend investors to acquire positions. (I personally love corrections since starting yield goes up as share prices go down.)
* See how great companies tend to raise and grow their dividends despite overall stock market performance. As long as business fundamentals are solid, dividends can increase each year. For this reason, it’s a lot of fun to buy dividend stocks during bear market sales.

If you enjoyed today’s video, I have a multitude of related videos that I’m sure will add value!

Here’s my video on investing one’s first $1,000 in dividend paying stocks:
https://www.youtube.com/watch?v=Iijz-5vGSh0

Want to learn how to invest $5,000 in the stock market? Here you go:
https://www.youtube.com/watch?v=5Bp0TzQKRr0

How about $10,000? This video is one of my most popular ones:
https://www.youtube.com/watch?v=4i_3KAY1ZMo

Finally, here is how I would hypothetically invest $25,000 in dividend stocks, if I were starting all over again:
https://www.youtube.com/watch?v=CGrf5He8ieU

In 2018, I’m really focused on investing in core positions that are also exhibit value. Procter & Gamble and Kimberly Clark are two of my favorites this year. Learn more in this video:
https://www.youtube.com/watch?v=uGRmIeiep1g

With interest rates increasing, utilities are under a lot of pressure. This creates a nice buying opportunity, in my opinion. Learn more about my position in Southern Company in 2018 and beyond:
https://www.youtube.com/watch?v=SW_jAVvhEqw

I am also finding value right now in REITs, especially Realty Income. Learn more in this video:
https://www.youtube.com/watch?v=P-ANUrAsqMc

Want to connect with me on social media? (Make sure to reach out via a public comment, so everyone can benefit from our discussion. I don’t check private comments as frequently.)
Instagram – https://www.instagram.com/ianlopuch/
Twitter – https://twitter.com/ianlopuch
Facebook – https://www.facebook.com/ppcian

Disclosure: I am long Procter & Gamble (PG), Kimberly-Clark (KMB), Realty Income (O), and Southern Company (SO). I own all four of these stocks in my dividend stock portfolio.

Disclaimer: I’m not a licensed investment advisor, and today’s video is just for entertainment and fun. This video is NOT investment advice. Also, I’m not a tax advisor and today’s video is NOT tax advice. Please talk to your licensed investment advisor before making any financial decisions.

All content on my YouTube channel is (c) Copyright IJL Productions LLC.

19 COMMENTS

  1. Hi dear. I love your video and I watch them all. I'm 18 y old and leaving high school this year as i'm ending it in italy and i'm thinking on what would be best doing next. Do you think that starting to work asap and saving something like 6000€ every year to dividend invest it before the market starts to grow again (3/5 years) would be a right decision? Thank you!

  2. Hello Ian. Thanks for these videos. I find them helpful. My question to you is what about dividend funds like SWDSX (just an example). Would you go for those?

  3. In my first month, invested in stocks, I learned it by myself…. do not put in large %-Amounts of your money in a short time.

  4. Curious what you make a year strictly off dividend payouts? And what the magic number is for you to retire and live off them entirely?

  5. Ian – Thanks so much. You are SO TRUE to your word, I asked you this questions a few weeks back (Selling my business for a lump sum) and you told me you hoped to do a video on it soon and just a few short weeks later – here it is! Thanks so much.

  6. First off, enjoy your videos.

    I do however disagree with your approach, but that is just my opinion. What happens if market keeps going up and dividend yelds go down?

    You can't time the market !!!!!

    I would develop an asset allocation strategy of stock/cash percentage based on your risk. Then deploy right away. After a year and stocks go down, buy more stocks from your cash to rebalance.

    Also focus on trading as less as possible to avoid commission charges. Fees can add up fast.

  7. My only criticism is your second to last sentence go consult with a financial advisor. Self directed investing is the only way to go to avoid fee's and tax protect your investments.

  8. my 50k portfolio is aple,glad,pflt,reit,gov. been holding it and collecting dividend …but lately it losing so much in capital but the dividend still good.

  9. Hey Ian.. excellent video ! I’m actually in this exact situation ! I’m wondering about your thoughts on some of the energy LP’s out there. It’s seems like there’s several nice looking midstream energy companies such as EPD that have very nice dividends (which are increasing).
    Keep up the excellent work !!

  10. its evident you have no timing skills, just buy ge 15 years ago and get killed and average down and when its in the basement guess what they cut the dividend your plan blows up. PG is in a down trend and being a dow stock will get killed in this bear market. this is the biggest top since 1937 this time it will work if your viewer is 20 years old and has patience one in a million.If you love buying good div stocks on the decline do you write covered calls?

  11. Not really sure how I found your channel but boy I'm glad I did. I been having a really hard time switching from capital growth to dividend growth investing. I finally understand it better and already got some PG, MO, SO, KMB, GIS, ED, PFE during the past few days and keeping my eye on a few more. My question is once I sell my other growth stocks does it make sense to have around 20 or so Blue Chip stocks/REITs in my portfolio (buy as the long the valuation makes sense) with around 6k each and deploy (average down) my second half of the money as the market keeps dropping or collapse? I really enjoy your detailed explanation of how this dg thing works. Thanks!

  12. Hi ppician , greetings from Singapore! Just wanted to say I appreciate how you continuously share your thoughts and experiences on youtube! I like the concept of dividend investing, but I do however would like to seek your opinion on the following:

    1) P&G’s dividend may have been rising for a past many years, but so has its payout ratio. Between 2006 to 2017, its dividend payout ratio has moved up from approximately 40% – 70% range over 11 years. My concerns are this may limit their dividend growth moving forward as their earnings do not grow in tandem with their dividends payouts.

    2) Just food for thought along the lines of dividend investing, but assuming one is vested in a REITs with:

    – Fixed interest rate loans
    – Yearly rental Escalations 2-3% per year
    – Weighted Average Lease Expiry >5years
    – Secured a strong diversified tenant base
    – Dividend yields of 6%

    Assuming a crash happens, and the REITs share prices are halved. But assuming most tenancies remain and few defaults – Does the dividend yield on cost double if I enter after the crash? i.e 12% yield.

    Not sure if that makes sense!

    Thanks would be great to have your view!

    Regards,
    Shawn

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