The Writer’s Coin

I’ve been meaning to learn more and more about a few things lately, including investing in the energy sector and taking advantage of stocks with a solid dividend.

For those that don’t know, dividends are “payments” that a company returns to its stockholders. You can either use that money to simply buy more of the stock (called dividend reinvestment) or you can take that money and keep it (but you’ll have to pay capital-gains taxes on it) .

Since the economy is apparently going into a recession and stocks in general are expected to be pretty flat, dividends are a great way to hedge against this, provided you pick the right securities (stocks, ETFs, or mutual/index funds).

It’s something I’m familiar with at an intro level, but I haven’t really gone into my obsessive research mode—which needs to happen before I make any money decision.

So it’s nice to bump into a fellow blogger who shares these and other concerns: Living Off Dividends is exactly what it sounds like and we both share an affinity for Warren Buffett. We both got started in all this after reading Kiyosaki’s book Rich Dad, Poor Dad, too.

So if you want to know more about dividends definitely check out his site.

As for energy stocks, this is one of those things that, years from now, people will be saying “Duh, you didn’t invest in alternative-energy stocks back then? It was so obvious!”

This is the sense I’m getting for reading finance-related magazines and websites, but maybe I’m totally wrong. Being an index-fund fanatic, I don’t think I’m ready to make the commitment to one or two specific stocks, so this article really lays out some good options in terms of which ETFs are good possibilities.

A lot of them are small-cap businesses, which means they are more risky but have the capacity to grow more than established stocks. It’s one of those high risk, high reward deals.

If you have any good websites, articles, or blog posts relating to these two topics, please post them in the comments section and we’ll see what’s out there that may help us all out.

Tags: alternative energy stocks, dividends