Lessons from Millionaire Teacher
In Millionaire Teacher, Andrew Hallam recommends a portfolio of ETFs (national and international total stock index) and short-term government bonds. For a 30-year old he recommends 30% bonds; for a 40-year old 40% etc.
Given that shares tend to do better than bonds over time, and given that I still have a long way to go until retirement, I am not sure a youngish investor would need any bonds at all, at least not such a huge portion. I will therefore, at least initially, invest only a small amount in bonds, perhaps 5% of my portfolio, to evaluate how they perform over time against ETFs and dividend shares.
I will keep looking for other bonds, but for now the one on my radar is iShares Euro Government Bond 7-10yr UCITS ETF (IBGM), which can be bought on the Amsterdam stock exchange.
My main focus will be ETFs and dividend stocks.
I am considering the following ETFs for about 70% of my portfolio. I have selected these ETFs based mainly on charges, liquidity, yield, performance and current discount/premium. http://etfdb.com/ is great for screening ETFs.
VAN FTSE EU ETF EUR (VEUR) seeks to provide long-term growth of capital by tracking the performance a market-capitalisation-weighted index of common stocks of large- and mid-cap companies in sixteen European countries.
U.S. Large-Cap ETF (SCHX) seeks to track as closely as possible, before fees and expenses, the total return of the Dow Jones U.S. Large-Cap Total Stock Market Index. The annual charge is only 0.04% and it's currently trading at a 0.61% discount.
The Vanguard High Dividend Yield ETF (VYM) seeks to track the performance of the FTSE® High Dividend Yield Index. The current yield is 3.13% and it's currently trading at a 0.43% discount. The annual charge is 0.1%.
I will also keep adding to QQQ whenever the price seems right.
About 20% of my portfolio should consist of dividend stocks.
I am considering four shares at the moment, in no particular order.
Realty Income Corp (O) is a REIT (Real Estate Investment Trust). Current yield is 4.58%, dividend is paid monthly and dividend has grown for 19 years.
AT&T (T) offers a 5,57% yield, just posted a good result and has a record of increasing dividend for 30 years.
TAG Immobilien AG (TEG) is a German real-estate owner and developer, which means no currency issues. However, the stock is listed on the Xetra exchange, so DeGiro charges €4 + 0.04% (up to a maximum of €60).
Greet REIT plc (GRN) is an Irish REIT which offers many of the same advantages as the German REIT with a cheaper charge of €2 + 0.04%.
EPR Properties (EPR) is a US REIT. Yield is 6.41%. Dividend growth is only 4 years. The share price seems to be on the way up.
The remaining 5% will consist of other shares, preferably paying dividend.
I will also take the EUR-USD exchange rate into account. Days when the dollar is relatively strong are good for selling US equities and buying eurozone equities. A weak dollar is a good opportunity for buying US equities.
In January, I intend to do a €100 challenge to see how much I can grow €100 in one year. That should be fun! Please let me know if you would like to join me.
Given that shares tend to do better than bonds over time, and given that I still have a long way to go until retirement, I am not sure a youngish investor would need any bonds at all, at least not such a huge portion. I will therefore, at least initially, invest only a small amount in bonds, perhaps 5% of my portfolio, to evaluate how they perform over time against ETFs and dividend shares.
I will keep looking for other bonds, but for now the one on my radar is iShares Euro Government Bond 7-10yr UCITS ETF (IBGM), which can be bought on the Amsterdam stock exchange.
My main focus will be ETFs and dividend stocks.
I am considering the following ETFs for about 70% of my portfolio. I have selected these ETFs based mainly on charges, liquidity, yield, performance and current discount/premium. http://etfdb.com/ is great for screening ETFs.
VAN FTSE EU ETF EUR (VEUR) seeks to provide long-term growth of capital by tracking the performance a market-capitalisation-weighted index of common stocks of large- and mid-cap companies in sixteen European countries.
U.S. Large-Cap ETF (SCHX) seeks to track as closely as possible, before fees and expenses, the total return of the Dow Jones U.S. Large-Cap Total Stock Market Index. The annual charge is only 0.04% and it's currently trading at a 0.61% discount.
The Vanguard High Dividend Yield ETF (VYM) seeks to track the performance of the FTSE® High Dividend Yield Index. The current yield is 3.13% and it's currently trading at a 0.43% discount. The annual charge is 0.1%.
I will also keep adding to QQQ whenever the price seems right.
About 20% of my portfolio should consist of dividend stocks.
I am considering four shares at the moment, in no particular order.
Realty Income Corp (O) is a REIT (Real Estate Investment Trust). Current yield is 4.58%, dividend is paid monthly and dividend has grown for 19 years.
AT&T (T) offers a 5,57% yield, just posted a good result and has a record of increasing dividend for 30 years.
TAG Immobilien AG (TEG) is a German real-estate owner and developer, which means no currency issues. However, the stock is listed on the Xetra exchange, so DeGiro charges €4 + 0.04% (up to a maximum of €60).
Greet REIT plc (GRN) is an Irish REIT which offers many of the same advantages as the German REIT with a cheaper charge of €2 + 0.04%.
EPR Properties (EPR) is a US REIT. Yield is 6.41%. Dividend growth is only 4 years. The share price seems to be on the way up.
The remaining 5% will consist of other shares, preferably paying dividend.
I will also take the EUR-USD exchange rate into account. Days when the dollar is relatively strong are good for selling US equities and buying eurozone equities. A weak dollar is a good opportunity for buying US equities.
In January, I intend to do a €100 challenge to see how much I can grow €100 in one year. That should be fun! Please let me know if you would like to join me.
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