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Dividend Stocks

The stock market has been a very bumpy ride for most investors, so much so that many of them are sitting on the sidelines. it’s a shame that they are doing it since there are other ways to making money than buying low and selling high. Dividend stocks are just another way to make money even when the stock market isn’t doing anything.

There are hundreds of companies that are traded on Wall Street that offer high dividend paying stocks for investors to take advantage of. What are dividends? Dividends are a way for a company to share the profit of the company with it’s shareholders. Many times a company has grown so much that they don’t need to put so much into research and development, so they will pass a portion of it to it’s shareholders on a quarterly basis (four times a year).

in doing so, an investor can make money even if the company’s stock price doesn’t change. Let’s say you buy shares in company XYZ for $100 per share and the company offers a 10% dividend. Which means that the company will give it shareholders $10 a year for each share you own. So four times a year you will receive $2.50 every three months for each share. After one year of owning the shares, your actual price per share is $90. If the price hasn’t moved over the same period, you are still up 10% on your investment. How could you go wrong with that? So where can you find stocks that pay dividends? When you do your research on a particular company, you will find the information in their chart overview.

There are also many different ETF’s that are built around this concept, but why pay a fee for something you can do yourself. Typically you can also do better than the ETF’s since you are able to get in and out easier than the big boys.

Be aware though that Washington and the present Administration is looking to raise capitol gains taxes which will include dividend payouts. Of course if it’s your IRA retirement account, it won’t affect you. Look into it for yourself to see if dividend stocks are right for you. it’s just another way to increase your profits. Espaecially when the stability of the markets are highly in question.

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Fixed Indexed Annuity Combines Fixed And Variable ...

A feature of fixed annuity contracts that many investors felt was missing was market participation. Even though variable annuities allow the investor the ability to tie their accounts to individual stocks and other market based products, variable annuities are anything but appropriate for most. For one thing, variable annuities have the ability to completely lose their value during market downturns. Couple this with notorious commission rates and unscrupulous sales pitches, and the variable annuity quickly loses its appeal. In answer to this need from the investing community, the insurance companies created a product that takes the best of both the fixed annuity world and the variable world. This product is called a fixed indexed annuity.

Fixed indexed annuities are fixed annuity contracts that participate in the market indexes. Most contracts tie their rates to the S&P 500, although other market indexes are also used. Rather than subject the contract to risk of loss, they are often given a guaranteed minimum interest rate. In market downturns, your interest rate may be at 0%, but your principal is guaranteed to not fall. Do the math on what type of interest rate you would require to restore your principal if you lost 50% of your account during a downturn. You’ll quickly see the advantage of this protection of principal.

These indexed annuities function much more similar to a fixed annuity than a variable annuity. They participate by giving account bonuses or interest rate adjustments based on the performance of the market. Although your account is tied to a market index, you will not necessarily participate in the full growth of the index. The insurance companies have built in various crediting options to help them counter the risk they take on during market downswings. Your actual participation in index growth will be limited by caps, participation rates, and spreads. How your account is credited will depend on the structure of the individual annuity and can fluctuate greatly between companies and even products within each company. As with any other financial product on the market, be sure to do your research before purchasing. Know your crediting options, and understand how your annuity is supposed to work.

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