2023-11-23 07:35:00 ET
Summary
- The market is closed today, but our minds should never be.
- I take some time to express what I'm thankful for and discuss what you can do to be thankful in the future.
- We are entering a season of giving, expressing thanks, and love to others. Let's start that season off right.
Co-authored by Treading Softly.
It's Thanksgiving in the United States today! Many of us will be coming together with family and friends to spend some much-needed quality time – maybe eat a little too much food as well.
In my house, we celebrate Thanksgiving twice a year. This is my second! As a Canadian and American citizen, I get Thanksgiving in October and November – I am not complaining!
It leaves me with a lot to be thankful for every year. The time with friends and family is essential in my mind.
Yet, even on special days, life and its demands never cease. I have chickens to feed, ducks to refresh their water, dogs to walk, and rabbits to check in on.
Likewise, we all have food to purchase, expenses that need to be paid, and bills that are accruing as we keep our lights on a little longer in the wintertime.
Today, I want to take a few moments to reflect on some things I am thankful for and share them with you – a good Thanksgiving tradition I've come to embrace.
My Portfolio's Income is Growing and Growing
To get us started, I'm thankful for my investment portfolio. I am a professional income investor – not a well-kept secret – and my portfolio is fine-tuned to produce high levels of income now and for years to come.
I recommend retirees reinvest at minimum 25% of what comes in as income back into their portfolio, and it will help keep their income growing year after year. We call this our Rule of 25 – one of two major guiding principles of our Income Method.
Furthermore, I've been blessed with various holdings in my portfolio raising their dividends. Most recently, we've seen an increase from Blue Owl Capital Corporation ( OBDC ).
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While I love any dividend increase or even additional supplemental dividends, it's rarely enough to move my income stream too strongly. I am always thankful for each one!
- Capital Southwest ( CSWC ) joined in on the fun as well. It has been a fantastic year for dividend raises from BDCs, I'm thankful to hold several of them.
- Eagle Point Credit ( ECC ) has been paying a supplemental dividend and just announced it will keep paying it for another quarter. ECC has the "problem" of having too much taxable income!
I view every dividend that arrives as cash to be thankful for. My thankfulness is compounded for any increases and supplements I've received from my holdings along the way.
Our Community is a True Blessing
Few places across the investment universe exist like Seeking Alpha. Not only do I get to interact with tens of millions of readers annually, but it hosts countless investing perspectives. If I like an investment opportunity, I can almost guarantee that there are a few people out there with the opposite opinion – I'm sure you've had the same experience!
This community allows us all to refine our perspective, test it against the perspective of others, and potentially avoid costly mistakes.
The key to success is civility. Seeking Alpha's team of editors and moderators works tirelessly to ensure we can all discuss our opinions in a calm and civil manner without personal attacks or outrageous accusations. This is key to a healthy community. When communication dies, we all suffer.
Furthermore, I am thankful for my growing community of income investors and retirees who follow our Investing Group. Both on the public and private side, this platform is a fantastic place to discuss income investments at any time and compare notes with those who are on a similar journey.
My team and I spend countless hours each month talking and discussing investments with various members, my own team, and our entire community. Their questions, comments, and words of encouragement consistently remind me why I choose to run a marketplace instead of a closed-end fund – I love to interact with people.
All that being said, I am thankful for both the Seeking Alpha public community and my privately hosted community. What makes this place worth visiting and returning to? You do. So, thank you!
I'm Thankful for the Income Method
When I was a younger man, I had big ideas on how to invest but no cohesive methodology. I often find being idealistic is a younger person's game, but one must create a methodology to make it functional.
Over time, I developed a more structured methodology and gave it a fitting name – The Income Method. It has rules that work as guardrails – like our Rule of 42, and Rule of 25 – and pillars that focus on being income-focused and ideals of when to sell an investment.
Many of you may have a general idea of the type of investor you are – growth, momentum, value, dividend growth, the list goes on – yet you don't have a methodology you ascribe to. You operate off of gut instinct or reactionary feelings. Rules and pillars may feel confining and you are more of a "free spirit."
I'd recommend you take some time this holiday season and create an outline of how you want to invest in the market and why you're doing so. The more specific, the better. I find goals or reasons like "to get rich" to be nebulous and unhelpful. Having a written down goal and method can help you stay focused and achieve success.
For income investors, having a tangible goal is essential to be able to measure your success level. I'd recommend an income-specific goal, such as "Have my portfolio generate $100,000 in dividends annually." This way, you can measure your progress toward this goal each year, and every decision is channeled through a process of determining if the outcomes of potential choices align with your greater goal and values.
If your goal is too nebulous, you will not have an effective means to determine how to achieve it, or when it has been achieved. Will you buy lottery tickets every week to hit it big and become rich? If you do, what will you do after that? Or will you buy penny stocks and flip them in the hope of finding the next big thing and hitting a home run?
Having a clearly thought out, time-tested method allows my team and I to focus on investments that will help our readers work towards a goal that fits into our perspective on the market.
We view the market as a tool and our portfolio as an extension of that. It generates income, which allows us to live freely and opens more opportunities for us to explore. The market does not consume our lives; it is a tool to be used. Just like a screwdriver doesn't take up your entire life, it's there to use when you need it.
I'm thankful for my unique Income Method, and I hope you have a methodology to follow that you can be thankful for as well.
Conclusion
On this Thanksgiving, I greatly appreciate you taking some of your valuable time and spending it with me.
I hope you enjoy your day and take some time to dwell on what we discussed.
I plan to eat a little too much food, enjoy great company, and get back to work tomorrow, talking to investors and retirees about their investments and their futures. For now, the market is closed, and you have a chance to get away from it – so embrace that fact and enjoy your day!
Consider taking some time to express what you are thankful for, and consider how you can set yourself up to have even more to be thankful for next year.
For further details see:
3 Important Thanksgiving Considerations, Tips To Unlock Abundant Income