32 Dividend Checks a Month

How to Turn Your Portfolio into a Daily Income Machine

If you're tired of that uneasy feeling you've got in the pit of your stomach -- worrying about the direction of the stock market, the economy, the U.S. dollar, and inflation...

Or if you're nervous about having enough cash left in your nest egg after this recession (and perhaps the next) to take care of your family and retire the way retirement ought to be -- comfortable, secure, and carefree...

Then please read on, because this report holds the solution you could be looking for...

Dear Investor,

The recent bear market just wiped out 13 years of capital gains.

Millions of baby boomers invested their 401(k) plans in aggressive growth stocks and patiently waited for the promise of a comfortable and secure retirement. Income investing was for widows, orphans and the faint of heart.

How is that working out for the boomers? 

Well, things aren't quite going according to plan. Most 401(k) plans had barely begun to recover from the tech bubble when the financial crisis came along in 2007. 

And even now, with a market rally at our backs, the Dow Jones Industrial Average is hovering around 10,000 -- right back where it was in 1999. Ten years of gains... gone.

Maybe you were among those who lost money.

Teachers, lawyers, farmers, accountants, business owners, realtors, retirees, you name it. Hardly anyone who owned stocks didn't feel the pain.

But somewhere in the outskirts of Austin, Texas... one investor was able to avoid the worst of the turmoil.

That's because -- in the depths of the worst stock market of our lifetimes -- this man's portfolio was quietly churning out "paycheck" after "paycheck" -- providing him with a steady stream of income and a healthy dose of confidence, comfort, and optimism amidst the economic panic.

He was concluding a 24-month long "real money" case study with a new investing strategy -- one that focuses on safety and security, but that also offers a steady flow of cash to your bank account -- nearly every single day.

It's proven to be an overwhelming success...

This man collected 340 dividend checks worth a total of $25,660.30 in 2009 -- the equivalent of getting a $70.10 paycheck every single day this year.

That man is my boss.

His name is Paul Tracy, and he is StreetAuthority's Co-Founder and Chief Investment Strategist. The revolutionary income strategy he's discovered can turn your portfolio into a daily income machine -- and he's tapped me to share this strategy with all of you.

Why me?

Paul wanted me on the project because he knows I have a knack for making investing simple. He just had to take one look my Stock of the Month program.

I've also spent years working with Carla Pasternak and other high-yield experts in the income investing sector.  So Paul's "daily paycheck" strategy is right up my alley.

In fact, Paul has so much confidence in my abilities that he's asked me to not only share his strategy, but actually run StreetAuthority's latest newsletter -- The Daily Paycheck.

This newsletter follows Paul's strategy to a "T". . . and even has a $200,000 real-money portfolio where I follow my own recommendations with StreetAuthority's money.

But before I get ahead of myself, I want to prove to you just how successful the "daily paycheck" strategy can be. . .

In the remaining portion of this report you'll discover the inner-workings behind Paul's revolutionary "daily paycheck" strategy... you'll see real examples from Paul's personal portfolio... and you'll have clear direction on how you too can start collecting paychecks that total up to $2,000... $3,000... even $5,000 or more a month -- all on autopilot!

The Blueprint For Getting
32 Dividend Checks a Month

Before we dive into the details of Paul's overwhelmingly successful "daily paycheck" strategy, take a look at the dividends he collected just last October by using this new strategy in his personal portfolio.

This gives you an idea of what kind of checks you could squeeze out of your own portfolio if you simply follow this proven strategy...

Remember, in 2009, Paul's average daily paycheck was $70.10. But in October alone he averaged $87.35 a day! This jump illustrates the awesome power of reinvesting your dividends -- you can literally watch your income stream grow each and every month. And these aren't insignificant little $2 and $3 checks -- these are $50... $60... even $300 checks that can pay for your groceries, your gas, your fine dining, your weekend at the spa, your holiday shopping... your country club dues... or even more shares. Keep in mind, we're only talking about dividends here... not cash from capital gains, which -- if you take into consideration -- are impressive in their own right: Several of Paul's holdings are up a total of +54%... +69%... +78%... +99%... even +108% and higher in the last 24 months.  But he's not selling -- instead, he's leveraging the dividends to buy more shares, which is quickly leading to even larger paychecks.  For example, back in September 2008 -- while Paul was still tweaking his new investing strategy -- he collected 15 dividend checks for a total of $513.44... and he put every cent back into more shares. That's why one month later, in October, he collected 17 dividend checks for a total of $985.88 -- which he also reinvested. Then, for the remaining two months of 2008, he averaged 19 paychecks -- for an average payout of $1,778.26 a month.

With each month that passes, this "daily paycheck" strategy can pay you larger and larger dividends!

To look at it another way, consider how much your income can grow on a year-over-year basis...

Over the entire 12 months of 2008, Paul "only" collected 180 dividend checks -- with each check averaging $35.53.

Instead of spending his dividends, he reinvested them, helping him earn even bigger paychecks this year: So far he's already collected 281 checks this year, averaging $76.48 each.

And this is just the beginning. . .

"By following Paul's eight 'no-brainer' dividend investing rules... and then reinvesting those earned dividends... you're able to get a more frequent income stream that grows larger and larger each month."

He swears that your income stream can become more frequent and grow larger by the month, too -- just like his. 

And the best part is, you can start with a portfolio of ANY size.

Just follow the same eight "no-brainer" rules that Paul does... and within weeks your nest egg could transform into a daily income machine that dishes out up to 30 or more checks a month.

And keep in mind, these are the rules that govern my new Daily Paycheck newsletter. If you'd like to learn more about The Daily Paycheck, simply visit this link.

Otherwise, keep reading to see all eight of the "No-Brainer" rules for building an increasing income stream with your portfolio. . .

It's a rule that should be etched into the granite walls of the NYSE: Never underestimate the power of the lowly dividend.

Although little respected and often ignored, more than 137 years of data point to the inescapable conclusion that owning humdrum dividend-paying stocks... and then reinvesting those dividends... beats all other investment approaches hands down. So if dividend-paying stocks make you yawn, it's time to wake up and smell the cash.

In the go-go high-tech boom 10 years ago income investors were laughed at as fuddy duddies.

Guess who's laughing now? With the markets near where they were a decade ago, dividends have been just about the only return seen by many investors.

Don't be surprised. Since 1926 dividends have contributed 42% of the total return delivered by the markets. This makes a massive difference over the long haul. Underestimating the awesome edge income-paying securities give you is the biggest mistake you can make in your investing life.

In fact, the odds are so heavily stacked in their favor that income investors almost always come out ahead.

In the 100-yard dash to wealth, income investors start on the 50-yardline. What's more, every time the stock market corrects, growth investors are forced to run backwards for 10 yards. How can they win?

That's why The Daily Paycheck doesn't chase growth. If it comes with a fat dividend, I'll be more than happy to put my money in a fast-growing stock. . . but if not, then it's to the back of the line.

When you start collecting $60... $70... $80... even $300 dividend checks on a daily basis, your first instinct will be to cash them.

But unless you really need to, don't.

Dividends are one of the most powerful wealth-building tools in an investor's arsenal because of the phenomenon of compounding.

By reinvesting your dividend checks (instead of cashing them), you can buy more shares, which leads to even larger dividend checks.

These larger checks can then be used to buy even more shares and so on. In time, even a small stake in such stocks can grow into a tidy sum. 

(Reinvesting your dividends is a cinch. In fact, many dividend payers do it automatically -- and if they don't, just give your broker a call and he'll take care of it for you in a matter of seconds.)

Look what happens to a $20,000 investment earning a 7% annual yield that's reinvested.

As you can see, steady compounding yields amazing results over the long haul.

Thanks to the power of reinvested dividends and dividend growth, after 10 years your portfolio could be generating $5,299 in annual income -- that's +278.5% more income when compared to an investor who doesn't reinvest. 

In fact, it could be generating an effective yield of 26.5% based on your initial $20,000 investment.

It doesn't take a genius to see how quickly your income stream can grow when you invest this way.

That's why my $200,000 real-money portfolio always reinvests dividends.

It's tempting to take the cash, but I know a little patience will only lead to larger paychecks.

One of the easiest ways to increase your income stream is to invest in high-yielding securities.

All else equal, higher yields will pay you more.

This rule is such a "no-brainer" that it doesn't require further explanation. Clearly, higher yields put more cash in your pocket....

Just a word of caution: One of the biggest mistakes income investors make is to flip open their copy of The Wall Street Journal and only buy the securities with the highest yields.

Although ultra-high-yielding securities paying 20% or more are tempting, keep in mind that common stocks don't guarantee yields or payouts. At any time, a company's board of directors can decide to cut its dividend distributions or eliminate them entirely.

So if you want to separate the high-yield gems from the high-yield junk you need to look for a few traits of strong dividend payers. These include payout ratios below 80%, a strong history of payments, and strong cash positions.

Fortunately, there are still plenty of companies that meet this criteria AND pay out hefty double-digit yields.

These are exactly the kinds of securities you'll want in your portfolio if you want to collect monthly dividend checks of $2,000... $3,000... even $5,000 or more.

No-Brainer Rule #4 "Small-caps beat large-caps.  So invest in the small guys."

It's only common sense that a small company with $10 million in earnings can double or triple that figure much easier and faster than a corporate giant with $10 billion in earnings.

And history agrees...

Over a recent 33-year period, small-cap stocks outperformed their large-cap counterparts, averaging +14.8% annual gains vs. +10.8% annual gains.

Over the long haul, that difference can add up to a substantial amount of money -- money that you can either spend or reinvest to grow your income stream even more.

Long-term Growth of Investing in Small-Caps vs. Large-Caps Growth of $10,000 10 Years 20 Years 30 Years 40 Years Large-Cap (+10.8%/yr) $27,886 $77,766 $216,866 $604,770 Small-Cap (+14.8%/yr) $39,757 $158,065 $628,429 $2,498,477

That's why, if given the choice, I prefer to skew my Daily Paycheck portfolio toward promising small-caps... especially high-yielding ones, like Main Street Capital (Nasdaq: MAIN), which yields 9.7%, makes monthly payments, and has returned +58% so far this year.

You're Halfway Through the 8 "No-Brainer" Rules I Follow in The Daily Paycheck... I hope you're enjoying this special report and find plenty of solid ideas you can use to transform your portfolio into a daily paycheck machine. There are still four more rules left... but if you'd like to learn more about The Daily Paycheck this instant, I invite you to follow this link. P.S. I published my inaugural issue just a few days ago. For my top picks, I selected seven of my favorite income stocks that will put my portfolio on track to become a daily income machine.

No-Brainer Rule #5 "Look overseas for higher income."

It's a cash-flow desert here in America for anyone who needs to bank an income off their portfolio.

The average U.S. stock pays just 2.2%. (We now have one of the stingiest stock markets in the world, apart from Japan's.)

While you can find the occasional high-yielding stock, odds are that anything paying above say, 15%, is a basket case. In fact, once you weed out the money losers, only 8 stocks in the entire United States pay more than 15%. Just 8 lonely survivors. But guess what? Expand your horizon a bit and it's a completely different story. Right now, there are actually 99 profitable companies yielding more than 15% -- they just don't happen to be in the U.S. Eight here versus 99 abroad -- where do you think the best hunting ground is for a yield-hungry investor? 93% of the jaw-dropping yields these days are abroad. Meanwhile, the dollar is weakening, boosting the value of those dividends month after month. And not only are the yields higher overseas, but foreign markets are growing much faster than the U.S.

Dividend Yields of Major Stock Indices The average dividend yield of the S&P 500 today is just 2.2%. That's peanuts compared to yields in other developed nations... Australia 4.0% Brazil 2.9% Czech Republic 5.3% Egypt 4.7% Finland 3.7% France 3.7% Germany 3.6% Italy 3.4% New Zealand 4.8% Portugal 3.2% Spain 4.7% Sweden 2.9% Taiwan 2.5% U.K. 3.5% U.S. 2.2%

Why keep your money in U.S. stocks paying 2.2% in a flat economy... when you can buy stocks yielding up to 15% or more in countries that are growing +5%, +6% and +7% a year?

That's why one of my first additions to my real-money portfolio was a fund focused on the Pacific Rim. . . that pays 7.2% in monthly installments.

No-Brainer Rule #6 "Choose fast-growing foreign markets over developed markets."

To say foreign markets are on fire is an understatement.

The benchmark MSCI Emerging Markets Index is up +63.6% year to date -- more than double the S&P 500's +24.1%

And that +63.6% is an average. Individual emerging markets have topped those gains, like Peru, which is up +122% in dollar terms... Russia, up +116... Indonesia, up +117%... India, up +87%... and Brazil, up +110% in dollar terms.

These markets are also among the fastest-growing economies on the planet. The IMF says emerging markets will account for all the growth in the global economy this year and most of the growth in 2010 as well.

Investing in high-yielders in emerging markets really is a "no-brainer."
 

No-Brainer Rule #7 "It's not what you earn, it's what you keep. Avoid taxes, legally."

Most of us consider ourselves patriotic citizens. But that doesn't mean we have to pay Uncle Sam any more than his fair share of our investment income. 

Unfortunately, when building income-oriented portfolios, many investors get blinded by high yields on fully-taxable investments without stopping to consider how much cash will be left over after the government takes its cut.

Although tax-advantaged securities typically offer lower yields, in many cases they will put more cash in your pocket at the end of the day. This is particularly true for investors in higher tax brackets. 

For example, if you're in the 35% tax bracket -- a tax-free investment paying 7% has a taxable equivalent yield of 10.8%. And a tax-free company paying 10%, has a taxable equivalent yield of 15.4%.

These are precisely the types of tax-advantaged situations that can transform your portfolio into a daily income machine.

In fact, my Daily Paycheck "Income Security of the Month" for January is a tax-advantaged fund. By investing in tax-free munis, this fund's 6.2% yield turns into a taxable equivalent yield of 9.5%! 

No-Brainer Rule #8 "Load your portfolio with monthly payers."

A key aspect of the Victorian definition of a gentleman was someone able to generate enough income to live on from their existing fortune without eating into their seed capital.

Back then it was called "living off your four percents" -- which referred to government bonds that paid around four percent.

Today, Paul's coined a new phrase for this lifestyle. He calls it "living off your monthlies." 

That's because a critical component of the "daily paycheck" strategy calls for skewing your investments toward companies that pay regularly monthly dividends.

The idea is to load your portfolio with enough of these monthly payers so that you get paid nearly every single day of the month... or more.

When you make the choice to invest in a stock that pays a monthly dividend, you'll probably be surprised when your first check shows up soon.

And you'll be surprised the next month, too, when another check arrives.

After the third month, you'll be spoiled -- you'll find it's easy to grow accustomed to this lucrative new source of passive income. Especially when you load your portfolio with monthly payers and you start getting these checks nearly every day.

And it's not just more convenient to be paid this often, you actually earn more that way. Thanks to the compounding phenomenon we talked about earlier, a stock paying out 1% monthly doesn't have a yield of 12%, but actually 12.68% -- a big difference over time.

Plus, many of the best stocks offer extremely stable -- and growing -- income. Several of the monthly payers we've profiled in our StreetAuthority income advisories like High-Yield Investing and High-Yield International have seen their dividends surge up to +130% over the past few years.

This combination of convenience, stability, and growing payouts make monthly dividend-payers an absolute "no-brainer" for your new "daily paycheck" portfolio.
 

Next Step: Transform YOUR Portfolio Into a
"Daily Income Machine" That Pays You Up To
30 Dividend Checks a Month or More

In the report above, I revealed the inner-workings of the "daily paycheck" strategy. 
Now it's YOUR chance to transform your own portfolio into a daily income machine...

At StreetAuthority, we're always looking for new ways to help our readers make more money. And because of the overwhelming success of this real-money case study, we've decided to offer a brand-new service -- based entirely on the proven "daily paycheck" concept.

Over the past several weeks Paul has been working closely with me to develop this brand new income service -- The Daily Paycheck.

And it's still early enough for you to get in on the ground floor. I published my inaugural issue just days ago!

To get all the details on this brand new service -- including an exclusive inaugural discount available for a very limited time only -- click right here.

 

 

 

Amy Calistri
Chief Investment Strategist -- The Daily Paycheck

Next Step: Click Here