Dildos and Dividends
The Gift that Keeps on Giving
I’m not going to lie, I’ve been nervous to write this article. Is it going to be too vulgar? Are people going to take me seriously? Am I going to completely ruin my reputation? So, I experimented... I asked all my friends and family if they wanted to talk about finance. Most often, the conversation went like this:
“I have an interesting article about dividends, do you want to read it?”
“Next.”
“I have an interesting article called ‘Dildos & Dividends - The Gift that Keeps on Giving.’ Do you want to read it?”
“Absolutely.”
Another time, I tried the experiment with a group of girlfriends. I told them about my new finance blog and they could not have been less interested. I could sense the conversation shifting to the recent WeWoreWhat drama, and just blurted out “The first article is about dildos and dividends” and every eye landed on me. At first everyone was silent, but then everyone started to die laughing and wanted to learn more. So I made a decision to push the envelope with my writing and see what happens.
I recognize this approach to financial literacy will rustle some feathers and it won’t be for everyone. But, if I end up inspiring even just one woman to start investing and feeling empowered to join the group of guys at a party that can’t stop talking about GameStop, I’ve done my job. Without further adieu - this is NYB’s Investment Advice and we’re not really in the business of boring, but I can assure you, you won’t forget what you learn today.
WTF is a dividend?
A dividend is a distribution of profits by a corporation to its shareholders.
What do Dildos and Dividends have in common?
Both aren’t that hard to grasp, gifts that keep on giving and have many different options.
They aren’t that hard to grasp - I acknowledge many of you may have limited expertise when it comes to dildos, but a quick google search will give you an idea of their soft and squishy nature. Dividends are pretty similar in my opinion. They seem really hard if you’ve never touched them but in all reality, they aren’t at all. Put simply, they are a cash payment a company will pay you to make you like them. If you buy a company’s stock and stay invested over time, they will put out for you (in dividend form).
They are a gift that keeps on giving - I’m not a massive consumer of dildos, but at around $100 a piece, I’m guessing they’re not just for single use. They are quite literally, a gift that keeps on giving. Dividends are literally the exact same. If you buy a company, let’s call them Apple, you don’t just get to hold Apple, you get the chance to earn dividends if Apple decides to pay them out. That means even if Apple’s stock price is going up or down, they might decide to give investors some money to thank them for being investors. It’s also an incentive to keep you invested. Like, hey, if you hold onto this long enough, we will give you some extra cash for sticking with us. See, we’re making hard things soft.
There are many different options - Have you ever googled dildos? Well, about 180 million searches come up. I would almost venture to say there are more dildo choices than dividend yielding stocks (yield =producing). When it comes to stocks and which ones pay dividends, there are millions. I can’t tell you which ones work best for you though, just like I cannot and will not try to recommend any product on Adam and Eve. You need to assess your financial state and determine what your goals are, but in doing so, keep the below things in mind.
Getting a Bit Deeper
Let’s say you want to start investing and you want to looking at stocks on your own. In order to do that, you have to do your research (remember, we’re no longer in the business of asking Bobby for his advice on Tesla stock). One thing you’ll want to look for in your research is Dividend Yield.
Dividend yield is the annual dividend per share divided by the stock's price per share. For instance, if a company's annual dividend is $1.50 and the stock trades at $25, the dividend yield is 6% ($1.50 ÷ $25). You can also think of it like this, if a company’s dividend yield is 6% and you own $10,000 of its stock, you would see an annual payout of $600 or quarterly installments of $150. Listen though, not every dildo or dividend is the same (regardless if they are 6 inches or 6%).
Things to Be Mindful Of
It’s important to remember a few quick things about dividends before you start stock picking for the highest yielding stocks.
They are NOT guaranteed - Even if a company previously paid a dividend, they are not required to do so. In fact, nothing in the stock market is guaranteed. Just like your TESLA stock can go up or down, dividend paying companies may or may not be profitable in a given year. If you expected a div and weren’t paid one, it might be an indicator that something going on with the company.
However, it is rare for companies not to pay - While it’s always a consideration, it’s more rare for a div yielding business not to pay you. If anything, companies try to pay a bit of the div in a down year. In fact, most companies increase the amount of their dividends over time.
Dividend Yielding Stocks MAY pay off - Over the past 93 years1 dividend stocks traded on the S&P 500 have provided investors returns close to twice those of stocks without dividends. But past performance is no guarantee of future results, so always try to gather as much information as you can before investing. Similar to thinking about dating, even if the person seems perfect, has the best teeth, makes their bed in the morning, and gets along with your mom, we all know just about anyone can have a crazy side.
Be Wary of the Big Ones - In general, a good dividend yield is about 4-6% (only slightly smaller than your average dildo size in inches.) God, the sexual innuendos really do write themselves. That said, you might come across some companies that say they are yielding 10% and above. While that might seem great in theory, remember that dividends aren’t guaranteed and this might just be a way to get you interested in a not so interesting stock. Kind of like your brother that keeps promising to pay you back for last time, but never does.
Whats next?
This is just the beginning of our friendship and I hope you enjoyed. Stay tuned for next week’s article (I’ll be dropping hints on my IG @notyourbfsinvestmentadvice). If there is a topic you want to discuss, please DM me or email me at kelsey.willock@tardiapp.com. I also host a weekly Clubhouse room on Tuesdays at 9:30am PST/12:30pm EST called Not Your Boyfriend’s Investment Advice, so you can ask me anything live. We’re just getting started.
https://www.investopedia.com/articles/investing/091015/5-reasons-why-dividends-matter-investors.asp