Before we moved to CA, we were looking at 1BD/1Bath apartments in the midwest for $400 ($200 each). For a long time I had no idea how to hack that on the coast until I fell over the RV idea.

@tightfistedmiser – As I see it (from a yield perspective), what costed $175,000 last year is only $85,000 today. From a fundamental safety perspective, it is less likely to see future declines currently, than it was a year ago. In short, it just got easier (unless actually selling stocks is part of the plan (it’s not part of mine).

@Jacob – Just keep in mind which companies are now more likely to cut dividends due to the current business climate.

Jacob,

Isn’t 6% – 7% a rather high current yield for the moment? The sectors that could provide such current yields include utilities, reits, mlps, some financials, and then you also have tankers, canroys, BDC’s which offer much higher yields.

I am mostly concentrating my dividend portfolio in the dividend aristocrats stocks ( not all of them however).

I disagree with you on the total return issue. As a dividend investor i do want to get a nice total return to match at least the market average. But dividend investors got a nice year to date performance as some bechmarks like the dividend aristocrats have outperformed S&P 500 YTD..

Anyways i would be interested in hearing more about your portfolio. E-mail me if you are interested about sharing dividend stock picks 🙂

I’m 33. In very good shape, non-smoker, etc. and willing to change my behavior radically to avoid medications (for instance, I’d rather sneeze or stay inside than eat allergy pills). I pay $72/month which is below 75, so apparently it is realistic, at least for me. I think my plan has a $3500 deductible; I can look it up. I found it on hasinsider.com (it’s blue anthem). To actually pay for something, I would take it out of the HSA account. It’s a nice tax-advantaged place to keep money. It functions much like an IRA with the tax advantage. If you consider the tax savings, it almost pays the premium. As far as I understand, I can even use it for general living expenses once I’m old enough. I intend to remain vigilant/proactive about my health.

Of the MLPs I watch, most are currently yielding 8+% and have a good track record for increasing the distributions. NRP is paying over 10% if you pick the right day to buy, but the asset price is down compared to 5-yrs ago. OKS is my current favorite and APU is okay.

For normal stocks, PEP substantially increased it’s dividend over the prior 5 yr bull market and isn’t likely to cut it. Imagine if you’d had your salary increased by 2.6x?!? It’s that sort of income growth that will make Jacob’s portfolio soar over time without much effort.

Since I wrote back in November, Johnny’s post reminded me that it’s probably time to revisit the dividends.

So far, so good on my dividend payers… they all increased or held their dividends except for Unilever (UL), which was down a little (<10%). In the MLPs, OKS dropped their distribution a little (<10%), but the others increased.

My one clunker has been Alliance Bernstein (AB), which manages mutual funds. Their payouts are tied to “assets under management”, so if the market falls, so does their payout.

With AB, I’ve frustratingly learned a lesson here… In December 2007, the recession was pretty much a foregone conclusion, so staying with AB entailed an obvious risk. My reasoning, at the time, was that even if AB’s assets under management lost 30-50% of their value that their distribution would be cut accordingly. And, to me, that was acceptable.

The lesson I painfully learned was that I forgot to factor in how the clients would redeem their money if the market fell too quickly… or if there was a credit crunch and the clients suddenly needed cash. Both of which are exactly what happened and the distribution for the most recent quarter was brutally slashed by over 80% compared to last year!

@martin When I quote numbers, I typically quote for one person only.

@Maus – There’s is simply no way that health care costs can outpace inflation in the long run. If it was true, it would come to completely dominate the economy and general inflation would EQUAL health cost inflation.

Health care is in a bubble. Once the boomers start dying off, I expect costs to normalize.

Incidentally, this post was written in 2008. It would be hard to get 7% or 6% yield today at the same risk levels.. it would cost almost twice as much now—the opportunity is gone.

But it will probably be back within 5-10 years.

I believe you always compute for a single. That would mean ERE for a couple would require $170,000. That is so attainable for so many. For a backup, let’s add another $85,000: $255,000. Still attainable.

I think many people wouldn’t want to know how attainable an ER goal is.

The lesson I painfully learned was that I forgot to factor in how the clients would redeem their money if the market fell too quickly… or if there was a credit crunch and the clients suddenly needed cash. Both of which are exactly what happened and the distribution for the most recent quarter was brutally slashed by over 80% compared to last year!

I’d be curious to see these numbers revisited with “affordable” health care (Obamacare) prices taken into consideration. Also, are these numbers for 1 person? I would love for us to be able to retire early, but as a family of 4 (with kids who won’t graduate and move out for at least 10 more years) I don’t see us being able to live on that little (yet). Our goal is to get our monthly expenses down to around $2000 a month (with kids still at home), but we aren’t there yet due to debt.