Australian (ASX) Stock Market Forum

Retirees Seeking Dividend Growth

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At my age and with time I'd rather give to other things than the market...... I am swinging to the LIC option.
However Dr Google informs me that there are huge numbers of these.
I can't see a specific recent thread on this so may start one with Joe's OK...
 
That's a good deal to digest Belli.... Maybe I'll go fishing instead :)

Being greedy I guess the following are sifters:
Low management fees
No performance fee
Growth
Dividends

As I mentioned I have ARG, MLT and WAM

Best of the rest?
BKI
MIR - higher MER?
PIC - high dividend but MER 1.0
WHF
PMC - as PIC
MFF --- good performance, low dividend.

Further comment would be great.
 
Also if you have a pool of cash that you hold, consider storing it in "rate setter loans", they pay high interest, and both principle and interest is paid back to you monthly over the life of the loan.

 
Cannot comment on much. When I do decide to invest funds, it's on the basis I'll never see it again. Usually, I look for a yield or around 4% - 4.5%, NTA close to or below price at the time depending on what the particular LIC does for a living.

Don't object to the managers making money but prefer it was only through them holding shares in the LIC and director's fees not via performance fees which seem mostly to be paid to management companies in which they also have an interest. I'm not hard and fast on that however. It's all whether I'm comfortable.

I'm 65 and have been doing this stuff since my early thirties and running the SMSF for 20 years. Not trying to shoot the lights out and keep it as simple as I can is my approach. Any gloss or excitement, if it exists, dissipated years ago. As long as the funds I invest are doing the job I want them to do, I'm not fussed.

And thank you to the tax office for the refund which will go into some more shares. Never waste a windfall. Did quite well without the dosh during the past year so may as well invest it. Kind of silly (dumb?) getting a refund when I also receive an account-based pension but that's the idiotic tax laws our Parliament has passed.
 
Thanks VH and Belli.... Think I may progress in this direction myself but seek opinions on which LICs.... I am also quite a bit older than you Belli and still doing some consultancy work, but easing off
 
Value Collector said:
Also if you have a pool of cash that you hold, consider storing it in "rate setter loans", they pay high interest, and both principle and interest is paid back to you monthly over the life of the loan.
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Hi VC, I looked around at a few youtube clips on Rate Setter and one fellow suggested to break the loans down into much smaller bite sized pieces to diversify and reduce risk. Did you consider or do this and what are your views on the loan guarantee facility, also I see there are some borrower details in recent loans created, such as use of funds and income, how did you go about deciding who got what, if you don't mind me asking?
Cheers Wyatt
 
Muschu said:
At my age and with time I'd rather give to other things than the market...... I am swinging to the LIC option.
However Dr Google informs me that there are huge numbers of these.
I can't see a specific recent thread on this so may start one with Joe's OK...
Click to expand...


At the risk of stating the obvious, to be comfortable with some certainty of a (continued) dividend payout, shouldn't we have to look very closely into the underlying business/es?

I mean if a company's financial position and performance is poor, or become poor in the future, its dividends will be reduced or cut.

With LICs or REITs... wouldn't we have to look at each and every one of the underlying assets/company that they hold to have a sense of certainty of keeping that principle and a reasonable interest/dividend?
 
Wyatt said:
Hi VC, I looked around at a few youtube clips on Rate Setter and one fellow suggested to break the loans down into much smaller bite sized pieces to diversify and reduce risk. Did you consider or do this and what are your views on the loan guarantee facility, also I see there are some borrower details in recent loans created, such as use of funds and income, how did you go about deciding who got what, if you don't mind me asking?
Cheers Wyatt
Click to expand...
Rate setter is a bit different to other peer to peer lenders, you don't get to know any details of the loan you are funding ( although you can see the historical loan book), and as you mention the provisional fund is there to protect you ( so far it seems pretty good protection)

You can break up you loans into as many small loans as you like, I generally put my money into 5 year loans, and have it set up so principle and interest payments reinvest monthly into 3 year loans, so the principle is constantly drip feeding into new loans, spreading risk.

The principle and interest of the 3 year loans then flows to my spending money account via automatic payment.
 
Value Collector said:
Rate setter is a bit different to other peer to peer lenders, you don't get to know any details of the loan you are funding ( although you can see the historical loan book), and as you mention the provisional fund is there to protect you ( so far it seems pretty good protection)

You can break up you loans into as many small loans as you like, I generally put my money into 5 year loans, and have it set up so principle and interest payments reinvest monthly into 3 year loans, so the principle is constantly drip feeding into new loans, spreading risk.

The principle and interest of the 3 year loans then flows to my spending money account via automatic payment.
Click to expand...
I have had a look at a few of these peer to peer lender and even started one application form [as a lender] but was missing a sophisticated investor document and end up half way and forgot about it, so far VC you have had a positive experience?
 
qldfrog said:
so far VC you have had a positive experience?
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You don't need to be a sophisticated investor for rate setter.

Yeah so far so good, as I said I use it to manage my cash holding.

I typically use 50% of my dividends to live off, but I generally have about 2 years of wages in cash to act as a buffer should dividends be reduced in the short term or a have a big expense come up.

So at the moment if I get say a $20K dividends check I break it up as follows.

$10,000 gets reinvested in more shares
$ 5,000 gets put into an interest account where I store spending money
$ 5,000 gets put into rate setter loans, where it then drip feeds back to spending money account.

-------------------

As I said above, I put the rate setter funds into 5 year loans, the 5 year loan principle and interest is reinvested into 3 year loans, and the 3 year loans principle and interest drip feeds back to my spending account monthly.

So if I put $5,000K into rate setter, it will earn a bit over 8% and the principle and interest feeds back to me slowly over about 8 years.
 
luutzu said:
At the risk of stating the obvious, to be comfortable with some certainty of a (continued) dividend payout, shouldn't we have to look very closely into the underlying business/es?

I mean if a company's financial position and performance is poor, or become poor in the future, its dividends will be reduced or cut.
Click to expand...

Absolutely, I would recommend those who are disinterested In following companies to choose an index like the asx200.

Perhaps even 70% asx200 index, and 30% international index.
 
VH: The only resource stock I hold directly is S32. I've been spending some time looking at LICs but without coming to a conclusion yet.
 
Muschu said:
VH: The only resource stock I hold directly is S32. I've been spending some time looking at LICs but without coming to a conclusion yet.
Click to expand...

The only LIC I own is Berkshire Hathaway, it's the only one I would recommend, other wise just by indexes.
 
Value Collector said:
other wise just by indexes.
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Pick any random non-investment forum and have a look at their "off topic" section for anything about investing. You'll find one consistent recommendation - index funds.

It seems that everyone from mechanics to hairdressers is, to the extent they're investing in anything at all, piling into this one. Take a look at your superannuation and where it's really invested - you'll find a pretty big chunk is simply tracking various stock market indexes.

Sounds awfully like a bubble to me particularly in the context of overseas markets (USA especially). Easy money - just buy the index and never sell. What could go wrong?

Oh wait, central banks are in the process of taking away the punch bowl..... :2twocents
 
Smurf1976 said:
Pick any random non-investment forum and have a look at their "off topic" section for anything about investing. You'll find one consistent recommendation - index funds.

It seems that everyone from mechanics to hairdressers is, to the extent they're investing in anything at all, piling into this one. Take a look at your superannuation and where it's really invested - you'll find a pretty big chunk is simply tracking various stock market indexes.

Sounds awfully like a bubble to me particularly in the context of overseas markets (USA especially). Easy money - just buy the index and never sell. What could go wrong?

Oh wait, central banks are in the process of taking away the punch bowl..... :2twocents
Click to expand...
Yep as discussed on the blog linked below. Everything happens in cycles. Index funds / ETFs can potentially make for a useful core but I haven't given up on actives. A contrarian approach has typically worked well for me over a few decades of investing now as a retiree:
https://stevegreeny.com/2017/08/17/...gers-to-outperform-common-catalysts-for-lics/
 
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