The Ultimate Dividend Portfolio

How to make the most from the payers among the stocks you own.

Feb 2, 2014 at 3:06PM

There's no better place to hold dividend-paying stocks than in the confines of a retirement account, Fool contributor Tim Beyers says in the following video.

Why? Taxes. Each time you receive a dividend -- or a distribution from a publicly traded partnership or real estate investment trust, or REIT -- you're receiving income that can be taxed. That's true even if you reinvest the dividends to buy new fractional shares in the company paying you. (Pro tip: Many brokerages provide dividend reinvesting as a free service!)

As such, Tim says investors might do best to use a retirement accounts such as an IRA or a self-directed 401(k) to invest in dividend payers. You'll enjoy deferred taxes on all distributions, which means you can reinvest 100% of the proceeds in pursuit of ever-higher levels of income. Tim says following this very strategy has allowed him and his wife to develop a long-term position in Prospect Capital that, today, pays a better-than-20% effective yield.

He advises those just starting their pursuit of dividend payers to take a closer look at American Tower (NYSE:AMT), a Rule Breaking REIT whose principal business is to construct towers that host wireless radios for distributing cell service and other forms of broadband to areas that need it. How big is the opportunity? More than 4 billion people remain disconnected from the Internet as of this writing, a huge gap that American Tower can help to bridge.

Now it's your turn to weigh in. Which stocks are in your dividend portfolio? Please watch the video for Tim's full take and then leave a comment to let us know what you think.

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Tim Beyers is a member of the Motley Fool Rule Breakers stock-picking team and the Motley Fool Supernova Odyssey I mission. He owned shares of Prospect Capital at the time of publication. Check out Tim's Web home and portfolio holdings, or connect with him on Google+Tumblr, or Twitter, where he goes by @milehighfool. You can also get his insights delivered directly to your RSS reader.

The Motley Fool recommends and owns shares of American Tower. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

Click here to learn about this incredible technology before Buffett stops being scared and starts buying!

David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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