Dividends are an excellent source of income. A reliable income is important for your financial independence. Here are 7 steps to setting up a source of income and receive a monthly dividend check.
1. The amount of the monthly income you received. Have you want how much money or must each month? A goal that you believe is reasonable. You can adjust to the amount as you go along. Once it has adopted the idea of your mind, you can take the steps to reach your goal.
2. Choose an investment fund, which pays monthly dividends. An investment fund that specializes on monthly dividend is useful for several reasons: a. the objective of the Fund agrees with the long-term objectives, b. Fund has professional management of the investment portfolio and (c) monitor. You have to deliver a larger and more diverse pool of securities, as you for yourself, a benefit for risk reduction.
3. Estimate the number of shares, you need to your desired monthly dividend income. An investment fund income distributed dividends to the participants, based on the number of shares. For example, if a monthly dividend of 2 cents per share will pay 50,000 shares of a Fund and the Fund, you will receive $1,000 per month. Of course, amounts are modified to the dividend. However you get an idea of how many shares, that you could want on the basis of the Fund history of dividends. The prospectus and additional investor information should have a record of the Fund's performance. Keep in mind that the historical performance is no prediction for future results.
4. Start investing an affordable amount. If you are new to investing, you are not familiar with a specific fund or if you are on a tight budget, it is a good idea, the structure of shares each month starting with a small amount. Most investment funds have an automatic investment plan allow that check by transfer from your ongoing monthly investment or savings account. The minimum amount of automatic investment plan may be as low as $50 per month. By start small can you risk distributed accustomed to the operation of the respective fund.
5. Reinvest dividends and capital gains. One of the best features of a dividend income fund is that you can invest through acquisitions of shares with the proceeds of dividends and capital gains. In addition to your monthly investment, your dividends that are reinvested build continuously additional shares in your account. These additional shares pay dividends also. Reinvestment of the dividend can continue to grow the number of shares in your account, even if you stop contributing to the Fund.
6. Increase monthly payments in the course of time reach desired goal. You do if you see your share balance grows, and if your budget allows it, regular deposit increases. You are encouraged, check your account statement, where you see the dollar amount of the dividends every month.
7. Requesting the payment of dividends. When you are ready, you can investment funds to stop reinvestment of dividend distributions and provide you with a monthly payment questions. Enjoy the satisfaction in knowing that every month there is a payment to your bank account or a check in the mail from the shares you have collected.
Howard Feigenbaum is registered principal and owner of SharePoint master, a broker-dealer company, the monthly dividend funds.
"You know, the only, what makes me joy?" It is to see, my dividends come inch "-John D. Rockefeller"
This article is a general discussion on the topic and it should not prompt or specific investment advice.
Copyright 2011 SharePoint master
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