Last week in the New York Times was an article about the cost of owning a sailboat. If you have been near a marina you have seen many sailboats in the marina. Those that own the boats, love being on the water, and the great majority have traded up. They started with smaller boats, examined the expenses and the time they spend on the water and over time moved up to the size they really want and enjoy. Similarly most people do not buy one home and live there forever. They tend to move 5 times before they settle for a number of years.

Linking to dividend producing stocks, you might ask where do I start? The best place to start is the industry or service which you make a living at. Those companies are the ones you have an “insider” view of how they are doing financially. Next look at your monthly payments, those companies should have many people similar to you making monthly payments – ie the gas, electricity, oil, banks, whoever it is. Next look at your kitchen – what companies dominate your pantry? Food and food distribution tend to have reasonably consistent earnings. Unless you believe you are the exception, many of the things you regularly do, others also do. After determining the starting place, narrow the criteria to companies that have paid a dividend for longer than 10 years. There will still be choice but it will be a good choice when there is no wrong answer..

There are always more questions than answers, till the next time – to raising questions