How To Invest With a $100 Budget (Robinhood Dividends)

i'm so excited about today's video because i want to share with you exactly how much money i'm making from my investments and i built this small little empire of money soldiers that work super hard for me 24 7 bit by bit dollar at a time 100 at a time and my goal is to have enough passive income to never run out for the rest of my life and i want to do all this before i hit the age of 35. now i'm not there yet but maybe i'll get there sooner but the best part about all of this is that regardless if you're on a budget or not anyone can do this now i try to make videos about investing in the stock market and passive income and if you've never seen my videos then welcome and if you've seen my videos before then this may seem really random or repetitive almost like it's on a perfect loop now i try to make videos about investing in the stock market and passive income and if you've never seen my videos then welcome and if you've seen my videos before then this may seem really random or repetitive almost like it's on a perfect loop now i try to make videos about investing and no i'm kidding i'm not going to make you watch that all over again just wanted to introduce you to my two other twins and to remind you that we're still living in the matrix ala 2020 style let's begin [Music] pick a stock oh money you say that's an interesting one okay i'm sorry you've seen this trick already before but i love it just don't play it back in slow motion otherwise you still won't know how that was done hi my name is andre jake hope you had a wonderful fourth of july weekend it was my mom's birthday on july 4th first what does that even mean fourth and i remember as a kid i used to think that those fireworks were for her and i still think that and also i just got a discord channel for my patreon i'm so excited because you can finally talk about everything stock market passive income dividends robin hood and everything in between like yu-gi-oh but please be patient with me i'm still learning everything and we're building out a community but i'm so excited so to start i've chosen something called dgi which if you're not familiar with stands for dividend growth investing and basically companies make so much money they've essentially run out of ideas on how to create any more products and even if they had more of our money they still wouldn't necessarily be more profitable the downside to this is that they're not going to create the next tesla or the next product that's gonna take the world by storm but the plus side to this is that because they're so large profitable and stable they can pay us the investor a fixed income you can go to dividend.com type in the ticker symbol that you want to check and it'll show you dividend yield with a number and a percent at the end alternatively you can check with your favorite brokerage investing app it'll show you the same exact information but the general rule of thumb is the higher the percent the more that you'll get paid but there's a catch because if you only aim for the highest yielding companies you'll more than likely end up losing money now personally i aim for four percent dividend yields because they tend to be more safe but more than that totally cool you just have to be a lot more cautious with now in theory companies can pay us their dividend forever without ever actually running out of money themselves but only as long as they are profitable this is in contrast to bondholders which hold a promise that somebody will pay them back their money in contrast to dividend shareholders which are paid last that's because dividends are paid at the swole discretion of the board of directors and at any moment they can choose to cut their dividend this recently happened to me with the banks bank of wells fargo because interest rates are at zero percent so they're not making much money and also papa powell and the federal reserve told the banks that they may not increase their dividend and they can't use their money to buy back more of their own shares this also means that their stock prices likely won't be going higher anytime soon so if you believe that banks are still going to be a big part of our future banks could represent a good value buying opportunity right now so in order to avoid losing money from dividend cuts because no one likes to lose money i look at the dividend safety score which is a whole separate service that i pay for which i'm not going to try to sell you on but then i'll look at that score and i'll see how safe that dividend is of being cut now if i see a low score i don't necessarily go and sell the stock right away because i have to figure out exactly why that safety score is low and will it ever come back like in the case of disney they cut their dividend but i still held on to that stock because i do think that at some point it will eventually come back but if we look at another company that i own which is ventus that's a healthcare reit now reits you want to look at something like the ffo or the funds from operations instead of looking at p e ratios or eps the earnings per share and that's because real estate investment trusts have property values that increase in value they decrease in value they use tax write-offs to offset their income there's a lot more of a nuanced way of figuring out how those companies are making money that non-real estate investment trust companies don't really have to deal with and specifically for reits i look for an ffo of 95 or lower and in the case of ventus their ffo was 116 which is nuts that means that of all the money that they make 116 of that goes towards people like me so instead of bleeding money right out of the company their board of directors said off with their head and they cut the dividend now as an investor i had two decisions that i was faced with i could have either sold that stock preemptively before they cut the dividend and i still would have lost money or number two i could have hung on to that stock and waited for the dividend to come back which is exactly what i did and time will tell if i made a mistake i told you this is going to get complex fast but let me know in the comments below is this too fast is it too complicated i remember it was daunting for me when i was trying to learn because i had to reread everything like 300 times so don't feel too bad if you have to rewatch it several times i feel your struggle but there's a lot more ground to cover so let's keep going now normally with dividend growth investing i don't only focus on stocks that pay me dividends i also want to see increased dividends and share prices increasing as well think of it like a triple threat like triple chocolate flavor for people with a sweet tooth for uh diabetes but the triple threat is dividend increases dividend payouts and share price growth in comparison to growth stocks which only focus on price growth which of course they see more of but that's it now once the dividend is paid to us though the stock may fall in price by the same amount that we were paid other times nothing happens to the stock price and other times the stock price can actually increase but generally speaking the stock price will fall by the same amount it was paid to us and then it'll generally over time recover now once i'm paid i get a little statement like the one you see on robinhood on the side right now and then i take that money and i reinvest it back into more stocks but not through drip which is the dividend reinvestment plan which is where as soon as you get paid you put that same dollar back to work into the same company that paid you instead i'll wait until i have enough money to buy more shares of a different undervalued stock at that time but if you're young and you don't have much time to deal with all this stuff then instead drip is an amazing option to look into you can also avoid paying taxes on dividends if you hold those dividend stocks in a roth ira account because as soon as you get paid those dividends you have to pay taxes based on your income tax bracket which for most people isn't a huge deal the good thing is that you'll save money on taxes but the bad thing is that you can only shelter six thousand dollars per year which for some people may not be enough and they want to invest more than that but that's why it's generally recommended to max out the roth ira first before going to a taxable account option like i have if you have no more other tax advantaged accounts to take advantage of if that makes sense now having said all that let me show you exactly how i'm budget investing because i want to compare this year's june to last year's june because we had a lot of dividend cuts and last year's june i made 800 and 24 cents which is awesome but then the yorana happened and scared off a lot of these dividends and i want to compare did i do better worse or am i about the same so now let's test the power of dividend investing so first i want to show you my dividend increases which remember is one of three things increases payouts and stock price growth the first one is target for six dollars second one is one dollar from wp carry and the third one is for six dollars again from vti now total that's 13 extra for the year that i get paid which i know that all happened automatically but i would tell you that i was going to be honest 100 no matter the good or the bad i would share with you and this is the first month in my investing career that my dividend decreases were higher than my dividend increases which makes sense but i actually lost 15 from ventus thanks a lot man not playing you from kingdom hearts anymore but that 15 while doesn't sound like a lot represents 428 at three and a half percent that i just lost which doesn't feel good and i suspect that maybe next month it might be even worse depending on if things improve or not now the second thing i want to look at is price growth and in the month of june the stock market gained 1.8 percent and my portfolio gained 0.3 percent which means i lost on 1.5 which may not sound like a lot but that is an enormous amount of money that i didn't get to make and the reason for that is because i'm really heavy on real estate financials and energy and none of those things are doing well right now the third thing that i look at is probably one of the most important ones and i don't blame you if you want to skip right past this point even though i do this in every one of my videos but there's only so many aflac duck jokes i can make about the same companies so feel free to do that but this past month of june i was paid 44 times which i think is a record for me and you know what they say a recycled joke and a paycheck a day keep the unwanted job away and remember one star means it's expensive to buy the stock right now and five stars means it's a good place to start doing your research but don't just buy a five-star stock just because it's five stars it's only just a good place to start all right one take rapid fire here we go june first four solid pairs they are wells fargo 1530 granger 720 then we have the aflac duck for 1960 and enbridge 1771. it was a good year way to start the day june 4th is three almost as impressive unilever 43.95 cumins cummins 393 and discover financial services 396 which is interesting because i don't have their credit card but they still pay me because i'm a g and i don't know what that means june 5th is paid by pfizer june 8th 25.60 cents amgen 16 june 9th haynes brands three dollars and one of my favorites johnson johnson 70 and 70 cents then we got june 10th otis one dollar sold that stock because ain't nobody got time for free stocks i wish robin hood would include trading stocks but that's just the pokemon master in me then we got emerson electric at 45.50 exxonmobil hanging in there by a thread 48.72 chevron which is doing better than exxon mobil at 86.43 target 46.20 norfolk southern 47.94 ibm 815 and x 4 cents which i also sold june 11th cnp counterpoint energy 10 35 from 69 shares june 12th mm 1470 june 15th eight times one shy of becoming 50 cent again lion dale basil 2.10 oh realty 1095 stag 6 mickey d's 1250 ip205 polaris 1240 colin frost bank 781 and key 1.8 june 16th duck energy duke energy eight dollars and fifty one cents june 17th lind 963 i had a subscriber say they worked for them which is pretty cool then we got june 18th raytheon technologies at 475 prospect capital 18 pennies june 19th flow 42.00 bp oil 43.75 june 22nd three dividends from shell 2080 vf 24 and d dominion energy 940 june 24th shallow hal nine pennies qualcomm 13. june 27th i got paid from an orc six pennies because they're really frugal i remember that from skyrim june 30th union pacific 30 ch robinson three dollars and six cents and that is all of it and i've got caught in mouth one take wonder now this past month of june the grand total was eight hundred twenty four dollars and fifty cents pause for just a second i got paid almost one thousand dollars to just breathe and do nothing there are some people around the world that are doing academic work that get paid less than half of that i know because i've got relatives in russia that are naval engineers that get paid less than half of that so that may not sound like a lot that is a lot of money in different parts of the world now in comparison to last year's june i was paid 800 and 24 cents that's a 24 difference or three percent which is amazing considering the economy right now when i was predicting this last month i actually thought this month i was going to make less but i didn't and that is why i love dividend growth investing so much also this past month of june i had three stock purchases they were all on patreon and they are as follows 50 shares of sphd at 33 dollars and 24 cents for a grand total of 1 661. and 43 cents i love sphd because it's a monthly payer but i also want to own more vym which is vanguard's high dividend yield etf this adds 88 dollars and five cents to my annual income the second stock i bought was 20 shares of philip morris at exactly 71.69 for a grand total of 1 433 dollars and 80 cents bad for your health to smoke but it's good for my wallet so i'm in a little bit of a pickle here because i really want to add more to this position because it's got a pretty safe different safety score good growth and already a high dividend yield the third stock i purchased is medtronic 17 shares at 91 dollars and 22 cents for a grand total of 1 550 and 48 cents get this dividend safety score of 99 which means their dividend is not going anywhere with 43 years of consecutive dividend raises but overall it would add 39.38 cents to my annual income now all of these purchases will get plugged into my handy-dandy spreadsheet which i will leave a link down below for my patreon no one sponsors my videos so i gotta sponsor my very own but it's really cool because it tells me exactly when i'm gonna get paid how much i get paid my diversity and a few other cool features plus a bag of chips i made that last part up you're not gonna get a bag of chips but it's really cool because it tells me the annual income that i've added overall is 220.97 which is awesome but if you've got 100 to invest right now you can get started with even far less with something called fractional shares now you don't have to use robinhood for this but most brokerages already have and have had this feature available for a long time but if you want to use robinhood you can check by going to trade and then if you hit buy and in the upper right hand corner you can select buy in dollars and you can put in as little as you want as little as a dollar ten dollars a hundred dollars the best part about this is that you can buy a hundred dollars of this stock in question right here and if you buy it it'll give you a fraction of that share but you'll still collect a fraction of the dividends in proportion to however much you own and i think that's a super cool way to get started better yet you can get started with two free stocks from weeble but make sure to fund your account 100 and you'll get a free stock valued up to 1 400 in value get another free stock from robinhood and that's three free stocks to get you started love you thank you so much for watching i will see you back here on monday and friday i post on my instagram from time to time of course join my discord channel we can all chat love you again stay safe stay kind stay legend wait for it dairy bye

Channel: Andrei Jikh

Views: 546,884

Rating: 4.8817878 out of 5

Keywords: How to invest, $100, Robinhood, dividend, dividends, dividend investing, stock market, how to be a millionaire, recession 2020, stocks to buy, best investment, investing for beginners, how to start investing, stocks for beginners, robinhood app, how to, invest, stocks, andrei jikh, Passive income, credit cards, how to invest in stocks, how to invest money, selling my stocks

Id: 9ayR6kZX0VQ

Length: 15min 41sec (941 seconds)

Published: Mon Jul 06 2020