Lux Investing - $7K to invest. What would a good long term dividend yielding portfolio look like?

$7K to invest. What would a good long term dividend yielding portfolio look like?

I plan on holding it forever with dividend reinvestment (whenver possible) until such time as I can retire (in about 25 years). Any suggestions? As an aside, how much diversity should one get with only $7K USD.

Public Comments

Put your money into cd's. Charles Schwab or Fidelity. 5% interest on 5 year cd's. The highest paying dividend companies are losing the most money. /
General Electric, Johnson & Johnson and so on.
Standard investment advice is that you should invest in a diversified mix of stocks, bonds, and money market funds. If you are like most people you will invest part of your money aggressively in stocks, and part conservatively in money market funds and bond funds. However, some young people will go all stocks, and some very conservative people will go all money markets. The links below have on-line questionnaires which will give you an idea of how to do "Asset Allocation," determining how much to put in each type of investment. You want to buy a diversified portfolio of stocks as individual stocks are too risky. Highly knowledgeable people can buy a properly balanced portfolio, but most folks have a difficult time balancing things on their own. They will misbalance their portfolio by buying all small stocks or all growth stocks, or some other misbalanced assortment of stocks. Back in 2000, Some people bought all Internet stocks; they got burnt when they all crashed together. You have to diversify across industries. Unless you know what you are doing, it is best to buy mutual funds that will diversify for you. Also with only 7K, it is hard to buy a diversified portfolio of stocks. Buy no-load, low cost funds. Mutual funds should have expense ratios of less than 0.5%. If your company offers a 401K plan at work, try to invest the most you can. The money grows tax free, and some companies will match your contribution. Investing in a mutual fund IRA is also a good idea. If you have children, you may want to consider a 529 plan or other college savings plan that grows tax free. I like index funds. Because of their broad diversification, you are less likely to have a dramatic drop in value. They also have the lowest expenses. For stock funds, I would suggest putting ~70-80% of your money in the Vanguard Total Stock Market Index Fund. and ~20-30% in a foreign stock index fund. However, there are many different opinions out there on what the best mutual funds are. Read the links below and form your own opinion. If you have high-interest debt, like credit cards, it is best to pay this off first before trying most of the investment ideas above. You should also have 3-6 months of salary saved up as an emergency fund in a bank or money market fund before trying more risky investments. Believing advice you get on Yahoo answers can be risky, so read these websites for further information. If you find it too confusing, contact a professional financial advisor. They will charge you significant commissions, however. I will warn you that there is a tremendous amount of stock investing books and websites that teach stock investing strategies that don't work. Particularly bad are people that teach "technical analysis" systems that sound impressive, but don't work.
With only 7k you can not get a great deal of diversity unless you invest in a mutual fund. And the way the economy is going long term you may wind up bonkers. But nevertheless I will attempt to provide you with a decent answer. There are quite a few relatively sound companies that are paying decent dividends and have a history of raising their dividends. For diversity you need at least 5 different companies. I know the banking industry is in the crapper right now, but that does make it a pretty good time to pick up a bank for a song. There are two that are relatively sound. At least I think they are relatively sound. I could be wrong. BBT and USB. They both pay dividends of better than 6% and they both have a long history of increasing their dividends. Or they have up until now. Maybe $1000 into one of those two. The next stock you want in your portfolio should be one in a completely different industry. KMB fits the bill. Household products. It has a history of raising its dividend annually. WMT does not pay all that great a dividend but it does have a history of raising the dividend and after the dust has settled, it might be the only retailer left. So that is my pick for the retail industry. T in telecommunications. FPL for utility. MMM for manufacturing
Easy answer - just invest in any stable mutual fund which has income or growth and income as its objective. Go to the websites for Fidelity, T Rowe Price, and Vanguard - you'll find plenty of Income and Growth and Income funds. If you are looking to invest in individual stocks, I particularly favor dividend reinvestment plans. Many are managed by ComputerShare (you can look up all their plans at https://www-us.computershare.com/Investor/Plans/buyshares.asp ). For a long term diversified porfolio, you might consider Pfizer, Exxon, Verizon, Bank of America (if you want a little excitement), Boeing, and Walmart (or Walgreen as an alternative) or many of the others they manage - but stick to well-known stable companies. You can spread your $7k among them. Key to making it work though, is consistent long-term contributions so you will be slowly accumulating shares over time. Dividends automatically get reinvested, and over time will grow. In 25 years, you'll be well set. If you invest in a mutual fund you won't have to worry about the diversification you'll get with only $7k - you'll have plenty.
Check out QuantumOnline.com and shop for preferred stocks in companies that have a lot of equity and cash. You might pick two or three (but make sure that they are in different industries and that none of them are banks or financial companies).
You can achieve a reasonably diversified portfolio of high quality companies with this allocation: 90 shares of MO Altria 80 shares of PFE Pfizer 30 shares of BP 40 shares of NSRGY Nestles 50 shares of T AT&T total cost $6,846.70 + commissions Annual dividends = $444.40 Portfolio yield = 6.49%
Some of these answers are good, such as muncie's. However, a simpler technique is to invest the entire amount you intend to dedicate to stocks, to a specialty dividend ETF. The Vanguard High Yield Dividend ETF (VYM) is really good, as is the Powershares High Yield Equity Dividend Achievers Portfolio (PEY) . The Powershares has a higher concentration of financials. The State Street Dividend SPDR (SDY) is interesting as well. If you use one of these for the stock portion of your portfolio, you will be somewhat diversified (VYM, for example, has over 500 stocks). However, they are I believe limited to US stocks. Powershares also has an international equivalent in the International Dividend Achievers Portfolio (PID). So you could combine one of the US ETFs with this one to increase diversification.
depends on what is a good yield for you. email me more details
google for HSFX Asset Management , simply the best make 3% to 10% monthly out of your capital and what are you waiting for?