Is anyone using "801K" plans?

[JBond]

I have been doing a bit of reading and there are a lot of pro's and con's. I wanted to know if anyone here had has long term success with this method of investing and any advice they may have.

http://stockgumshoe.com/reviews/12-letter/us-801k-plans-double-returns-from-401ks/

 

[WV Cowboy]

I have been doing a bit of reading and there are a lot of pro's and con's. I wanted to know if anyone here had has long term success with this method of investing and any advice they may have.

http://stockgumshoe.com/reviews/12-letter/us-801k-plans-double-returns-from-401ks/

Do you do dividend reinvest for all of your stocks currently?

 

[Yeagermeister]

Mine is barely a 201k

 

[Meat-O-Rama]

Sounds like they've come up with a fancy name for DRIPs and would be glad to charge you for it. You can do DRIPs yourself with just the smallest bit of research and keep the fees for yourself. It's not a sexy form of investing, but it's great long term.

 

[Dallas]

Mine is barely a 201k

You barely have an AK....47...

 

[JBond]

Do you do dividend reinvest for all of your stocks currently?

No...Needed cash flow for various reasons. I no longer need that cash flow. The rest of my investment experience is in precious metals using several different methods.

Sounds like they've come up with a fancy name for DRIPs and would be glad to charge you for it. You can do DRIPs yourself with just the smallest bit of research and keep the fees for yourself. It's not a sexy form of investing, but it's great long term.

That is my understanding also. I am almost 41 and need to get serious about my retirments plans. I am looking for long term (20-25 years) types investments that make good use of compounding. I want to try this on my own and as you suggest keep the fees for myself.

 

[Meat-O-Rama]

I am almost 41 and need to get serious about my retirments plans. I am looking for long term (20-25 years) types investments that make good use of compounding. I want to try this on my own and as you suggest keep the fees for myself.

I was about to recommend maxing out your 401k contributions before contributing to DRIPs, then I decided to research it a bit. Here's a pretty nice article comparing the two, and it sound like if you are getting an employer match on your 401k, that's still the way to go. If you still have money left over DRIPs are a great way to go to complement that.

http://www.getmoneyenergy.com/2008/06/invest-in-dividend-reinvestment-plans-drips/

 

[JBond]

I was about to recommend maxing out your 401k contributions before contributing to DRIPs, then I decided to research it a bit. Here's a pretty nice article comparing the two, and it sound like if you are getting an employer match on your 401k, that's still the way to go. If you still have money left over DRIPs are a great way to go to complement that.

http://www.getmoneyenergy.com/2008/06/invest-in-dividend-reinvestment-plans-drips/

I am my own employer. No matching 401k for me. Most of the revenue from my little enterprise is put right back into the company towards expansion costs. That is why I was considering the DRIP/801k investment strategy. I have limited experince in picking stocks, but I plan on learning as much as I can. Sticking with the big boys that pay out consistant dividends seems to be the way to go. Not sexy or exciting, but it seems to make sense long term.

Thank you for the link.

 

[Yeagermeister]

You barely have an AK....47...

There's not enough money in it to be considered a 401k :

 

[WV Cowboy]

I'm a little confused, .. I'm not a stock guru or anything.

Is there a difference between a DRIP, and just having the dividend paying stocks that you own automatically reinvest your dividends instead of receiving that money in a check once a quarter or whatever?

I have my 401k set up to reinvest my dividends automatically. And the 3 or 4 dividend stocks that I own outside of my 401k are set up the same way.

Is this different than having a DRIP stock?

With one of my stocks outside of my 401, I have purchased 18 additional shares of stock, at $55 dollars a share, simply by doing nothing myself and letting the dividend reinvest buy the extra shares.

 

[JBond]

I'm a little confused, .. I'm not a stock guru or anything.

Is there a difference between a DRIP, and just having the dividend paying stocks that you own automatically reinvest your dividends instead of receiving that money in a check once a quarter or whatever?

I have my 401k set up to reinvest my dividends automatically. And the 3 or 4 dividend stocks that I own outside of my 401k are set up the same way.

Is this different than having a DRIP stock?

With one of my stocks outside of my 401, I have purchased 18 additional shares of stock, at $55 dollars a share, simply by doing nothing myself and letting the dividend reinvest buy the extra shares.

Basically I have a "friend" that wants me to invest through him. I feel that with a bit of education on the topic, I can do it on my own.

 

[WV Cowboy]

Basically I have a "friend" that wants me to invest through him. I feel that with a bit of education on the topic, I can do it on my own.

Well, I've never heard of the 801k, but I am enjoying dividend reinvestment I know that.

I wish I had known about it when I was younger.

 

[JBond]

Well, I've never heard of the 801k, but I am enjoying dividend reinvestment I know that.

I wish I had known about it when I was younger.

How long have you been reinvesting the dividends and has it grown as you expected? I am considering ultra stable companies that have a strong dividend history like Microsoft, Walmart, Sycco, Coke etc.

 

[WV Cowboy]

How long have you been reinvesting the dividends and has it grown as you expected? I am considering ultra stable companies that have a strong dividend history like Microsoft, Walmart, Sycco, Coke etc.

I'm not real sure how long, each stock is different based on when I bought it. I know not long enough though.

That is with the individual stocks that I have purchased, ... my 401K has been reinvesting for 23 years though.

Look around and you can probably find some strong companys that are paying higher dividends than Microsoft(2.59 yield), Walmart(2.20) Coke(2.57)

Like BP right now is 4.49

Man, BP was 'killing' for me until the Gulf spill. I bought it at 41, it was up to 59 and paying a good dividend all along, .. and then, thud!

Like you say, make sure they are stable companys and you are good.

I love the dividend reinvest because I just forget about it, and it grows.