What the hell is going on in the stock market these days?
Within one week the S&P 500 index dropped over 11%, however a few days later it recovered to cut that loss in half. Below S&P chart for the month of August – note the ass whoopin’ at the end.
It’s times like this I wish I didn’t check my personal portfolio regularly…I took a $4k hit investments in August, however, I invested a good chunk more which basically kept my portfolio even on the month.
When the stock market takes a dump like this people tend to panic a little, which is understandable.
If I planned to retire tomorrow I’d be devastated because I’d have to sell some of my investments to live off and swallow some of this $4k loss I just took.
I’m not retiring tomorrow, or any time within the next few years, so I don’t give a rat’s ass. In fact, now I can buy stocks at a discounted rate. As far as I’m concern CNN Money and their doom and gloom headlines for the month can suck it…
For those of you looking to retire soon and sweating market swings, check out PK’s article on this blog where he talks about investing for retirement.
My Light at the End of the Tunnel
I’ve talked a few times on this blog about my dividend growth strategy. The beauty of this investment strategy is it allows you to focus a lot more on dividend payouts rather than the volatile value of the stocks themselves. (Note: dividend paying companies typically outperform non-dividend paying companies, so I’m golden)
Each month I tally up the amount of dividends I receive. These dividend payments continue to grow for two reasons:
- I’m investing money each month, so with more shares I get more dividends
- The companies I own continue to increase the amount of dividends they are paying per stock unit
All this is great news, but it gets even better! Each time when I get paid a dividend, instead of spending it on hookers and blow (just kiddin’ Mom!!!) I reinvest them and buy even more stocks! So even in months where I may not be able to contribute new savings, my nest egg still continues to grow!
My annual dividend payments/reinvestments for 2015 will be approximately $3k. I’m planning on growing that figure to $5k in 2016. This is the beauty of having your money work for you.
My mortgage is up for renewal at the end of September.
Since buying my first house five years ago I’ve gone with a variable rate mortgage, which has served me extremely well in this low interest rate environment. I do have the option of a fixed rate, but I’ve always felt lenders typically offer fixed rates at a premium (and not just to be nice). For now I’ll stick with variable.
I continue to use a mortgage broker. As PK mentioned in an earlier post (this guy just keeps writing hit after hit!) using a broker typically provides a better rate and has someone else do the shopping around for you.
Below is my net worth update figures for the month of August: