Comments on: 3. The Dividend Guy’s Guide to Building a Dividend Portfolio: Asset Allocation

By: Raj

Raj — Tue, 20 Feb 2007 11:59:14 +0000

Have you given any thought to optimal sectoral allocation for dividend-paying strategy – in order to reduce risk. S&P 500 sectoral percentages would not be appropriate because they include non-dividend stocks.

Is there an index of just of dividend-paying stocks? If so, how much in each sector? I wonder what is the max % prudent for banks, utilities and telecom, for example?

By: Rob in Madrid

Rob in Madrid — Sat, 10 Feb 2007 18:07:06 +0000

My Dad is 75 years old and is 100% invested in the stock market. He has about 500.000 CDN all in DRIP stocks, currently he is receiving about 25.000 a year in dividends. other than cash in the bank he has no bonds, MFs or RSPs RIFs.

Personally considering increasing longivity moving into cash as we age is losing stagegy as you need as much income as possible. I considering DRIP stocks to be a conserative move

By: Oilguy44

Oilguy44 — Thu, 23 Nov 2006 03:28:23 +0000

I have the same dilemma with my company, they have pretty lousy funds to chose from, but I max out the free money aspect and put it in their money market account. I then transfer the money to my own self directed account so as not to trigger any taxes, I usually do this twice a year.

By: The Dividend Guy

The Dividend Guy — Mon, 19 Dec 2005 04:50:33 +0000

Hi Dave,

First, if your employer is giving you free money to invest, take as much of it as possible. It doesn’t matter if it is in a RSP or a non-RSP account. My personal opinion is to max out as much as you can afford so as to get the most “free” money from your employer. I do. Just pick the cheapest funds (in terms of MERs) you can and go from there.

Second, in terms of the whole RSP vs. non-RSP debate I am undecided. I tend to focus more on my RSP just because I like the tax refund it can generate. However, this may be weak argument. I do however have a non-RSP account as well but it is quite a bit less than my RSP. Why not have both? Put as much as you want into the RSP and the rest into the non-RSP account. I am sorry that this doesn’t answer your question specifically, but I really don’t have a clear cut answer to this question – I am still trying to figure it out myself.

By: Dave

Dave — Fri, 16 Dec 2005 21:48:32 +0000

I would be curious to know your position on registered vs. non-registered accounts. I have an RSP account that my employer matches to a certain limit. Though the choices of funds aren’t great (high MERs, etc.) the free money aspect help make up for it. I would like to open a new account that’s a little more self-directed (i.e. either specific dividend paying equities or index funds (like TD e-Series) and have a number of choices:

1. Restrict my employmment related RSP and open a new registered account as my main long-term savings account.

2. Keep my work RSP and open a non-registered account.

What are your thoughts? What issues should I be considering?

Thanks, and I’ve really enjoyed your blog.

David