SOLD 12 of my dividend stock.
SOLD 12 of my dividend stock.
Radical move - love it
I did something similar - after a couple of months of Free Trading I realised I had got a bit carried away, so for every new company I buy I make myself sell two of the old ones.
I’m curious as to how you decided your stocks when dividends are your goal. The dividend yields at the likes of Apple, Tesla, 3M, McDonald’s etc. is very low.
UK stocks tend to be better for dividends but you’re very low on them. Unilever, BP, GSK etc. all do much better.
Looks like Debinhams went up 50% today after Mike Ashley got scared of loosing his entire share and decided to offer to buy the whole company
Hey john, Tesla actually dosnt pay a dividend I only bought them for the potential huge return in the next few years. As far as Apple ,there a pure growth company which means if I buy now there’s a big chance my % of dividend will be much higher when they increase the dividend every year, again Iam in it for the long term. McDonald’s is a great dividend investment, again they consistently raise their dividend annually. As far as UK stocks, I sold them because of the brexit situation but I will be adding in near future. Also what I hate about UK stocks, 99% of them pay 1-2 times a year as aposed to 4 times like all of US stocks. Ps I own Bp
Many UK investment trusts pay quarterly dividends, including City of London (CTY), which is available on Freetrade and which has a current dividend yield of over 4% and has increased its dividend for over 50 consecutive years (although of course, past performance is not guaranteed, etc etc)
Hey guys I’ve totally changed my dividend strategy. Check my video and let me know what you think
Not sure I necessarily agree with your reason for changing the strategy but its great to see such conviction. I said it a while ago but I think its great that you share this level of detail - keep up the good work.
Just out of curiosity, are there any tax implications for saving on behalf of children in your own name?
Thanks dude As far as tax implications Iam not sure. Good question, I assumed it was tax free up to a certain point. I’d love this question to be answered.
Junior ISAs (JISAs) are available with other platforms, just not with Freetrade at the moment.
You would be able to open 3 separate ones in their names but they would be able to get their mitts on them when they turn 18, so perhaps keeping them within your own ISA might be an idea! That said, you can only put in a max £20k in your ISA, whereas you would also be able to stick in an extra £4,368 in each JISA (also all tax free).
For info, part of my own ISA has investments I’ve put aside for my nephews and nieces but I’ve decided they won’t get the proceeds until when they turn 21.
Great info. That’s £20,000 PER year right? That more than large enough for their savings. Thanks for the info
Yes, £20k per year for the ISA.
If you are planning to get that revenue in dividends are you just going to stop adding to your portfolio when you get close to £2000 per year? I just can’t see why you don’t have your investments in the ISA and Junior ISA’s elsewhere until/if Freetrade offer them
£2000 a year in dividends would be roughly 10 stocks with this strategy. What makes you think I would be stopping? I would repeat the process with another 10 stocks. I would love to have 30 or so stocks in the portfolio paying at least £200 a year in dividends. If not more. It’s mainly because freetrade don’t offer fractional shares so when receiving such little money there’s nothing you can do with it except put it in cash and wait until you’ve accumulated enough money to buy a particular stock. Putting my children’s savings in my isa is very handy having everything in one place in freetrade. Why would you advise against this?
Any dividends you receive over and above £2k will become taxable. If you are a basic tax rate payer, the rate you will be taxed is 7.5%; if you are a higher rate tax payer, you’ll be taxed at 32.5%.
However, if all your dividends were wrapped up in your ISA, none of it is taxable.
Yeah I’m no tax expert but I would try to find some advice if I were you. It sounds like you could be at the mercy of the Taxman - who will eventually catch up you believe me and will take retrospective action for any violations. It’s probably worth a read over this topic if you haven’t already - Portfolio sized ISA Pricing - There were some pretty strong opinions on ISA’s being worth the cost or not but I’ll leave you to make up your own mind.
On the face of it, you might be better having the money for your kids in the GIA & your savings in the ISA. But, might be better getting some professional advice as I’m not sure how ‘gifting’ money to kids is handled anymore.
Edit - I’m also conscious of this for you because you have a very public record of what you have done on Youtube - eg I don’t think you could hide/deny that from HMRC. Sorry mate, I sound super boring but I’m honestly just concerned about your tax implications. I don’t mean to sound negative at all.
Enjoy the videos Louis.
Personally I would put the children’s stocks and my own stocks all in the ISA and have a little black book with notes on who owns what number of each stock and update the book each time you trade.
It’s less stress than having to think about tax
Thanks Richard. I think this make the most sense. Is there an easy way to transfer my stocks or do I have to sell then rebuy them in the isa?
Pharmaceutical stocks such as AbbVie can be quite volatile - one piece of bad news ( trial failure, regulatory issues ) can send them heading south rapidly ( I’ve been stung before ).