Shandril I believe that fixed annuity rates are more tied to the current interest rates rather than the stock market. We’ve got historically low interest rates now so thus annuities are not paying well either. The 6% fixed annuities of the past were when you could get 2-4% on savings accounts.
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As I mentioned before…the best time to buy into annuities (if you must…I’m not a fan even though I own one) is when you DON’T need it. My mother had one that provided 7% for life AND had a death guarantee equal to the original amount…the 7% was also always calculated based on the highest point her account had ever reached regardless of current value…and would not drop below initial investment. I have a very similar plan that pays 6% although I’m reinvesting it since I don’t need it right now. Actually I should look if I can contribute more into that now that I think about it as I’ve already maxed my addon cd’s from macu and gte.
That makes me curious about how the insurer is making up the difference to guarantee 6-7% returns. Also 6-7% sounds about on par with immediate annuity annual payments but in this case, they do not return the initial investment so how are fixed annuities delivering the same no-risk returns?
I’m not sure on the exact % rates that banks were paying. But 4% in a savings account is relatively high. We might have been paying 8% on mortgages back then. Corporate bonds were probably 6-8%. So insurers paying 6% on annuities isn’t woudln’t be unusual.
You can get 6%+ on fixed income annuities no problem now (if you’re elderly). But they don’t generally pay back the principal. So thats not really a high return at all.
THe annuity that paid 7% and had return of principal is a higher return but the details of that annuity would be important. It might have been bought 20 years ago on someone who was 60 years old when they took it.
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It’s been right at a year so here is a quick update on the stocks I’ve previously mentioned. I originally purchased 10 and later added 3 more(SQ, TTD and AYX). I’ve since then sold Dominion Energy
and purchased Southern Company which is a similar utility stock that pays about the same return. The dividends shown are based on what m1finance.com is showing in my account. I’m unsure if it’s calculating based on my original purchase price or current price so rate may be different than you see posted on financial sites. I added 3 additional stocks yesterday (WELL, O and WBA).
Overall Return: Up 33.17% ← Both increase in value AND dividends paid factored in. (again calculated by m1finance.com)
Name
Value
Gain / Return
Actual / Target
★
SQ
Square, Inc.
▲121.90%
13.3%
13%
★
TTD
The Trade Desk, Inc.
▲89.31%
11.4%
14%
★
AYX
Alteryx, Inc.
▲44.14%
9%
13%
★
KMI - Dividend 6.97%
Kinder Morgan, Inc.
▼25.24%
8.8%
5%
★
ABBV - Dividend 4.64%
AbbVie, Inc.
▲56.13%
7.2%
15%
★
WELL - Dividend 6.36%
Welltower, Inc.
▲1.75%
6.1%
1%
★
O - Dividend 4.52%
Realty Income Corp.
▲1.49%
6.1%
1%
★
WBA - Dividend 4.45%
Walgreens Boots Alliance, Inc.
▲1.07%
6%
1%
★
BNS - Dividend 6.40%
The Bank of Nova Scotia
▼11.38%
6%
5%
★
GIS - Dividend 3.04%
General Mills, Inc.
▲19.59%
4.7%
5%
★
PEAK - Dividend 5.30%
Healthpeak Properties, Inc.
▼16.48%
3.8%
5%
★
T - Dividend 7%
AT&T
▼9.98%
3.8%
4%
★
F - Dividend 8.67%
Ford Motor Co.
▼21.86%
3.6%
4%
★
C - Dividend 3.88%
Citigroup, Inc.
▼17.58%
3.5%
4%
★
VLO - Dividend 6.17%
Valero Energy Corp.
▼22.85%
3%
5%
★
SO - Dividend 4.51%
The Southern Co.
▼1.06%
3%
5%
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How did you choose these stocks?
It was explained in the previous posts which you could look at. They link to some motley fool articles that discuss it further. Original Post: Low Risk Income Alternatives to CD's (stocks, p2p lending etc) - #21 by famewolf
The most recent 3 were collected from various articles about dividend stocks that were attractive right now based on price/dividend. I am not a motley fool customer however for those who don’t want to do their own research I DO think it’s a good service and has consistently beaten the S&P for a LONG time. I may at some point consider it as the articles I’ve used have certainly come true in the forecasts.
Discusses Southern Company and Dominion
PEAK=HCP
update I’ve scheduled a purchase for these two tomorrow.
here’s a stock on seriously looking at and very close to deciding to buy.
I’m also looking at Seagate which is stock symbol STX I believe which was recently discussed on fool.com as well.
For those who want to stay up to date on stocks that have their interest here’s how to set an unlimited amount of alerts for free which will send the news to your email (and has some other options too I think).
You can go here: https://www.google.com/alerts
and setup however many you want of anything…I have alerts that search for my name, email, street address etc and am now adding ones that list the stock name and symbol ie “Kinder Morgan Inc KML” and choosing “only the best results” will weed out weird sites. For my name/address/email alerts I take ALL results. I also select “as it happens” to be notified.
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Things that could have been brought to my attention YESTERDAY!!! 
I’m pretty sure there are scripts / bots that crawl the web, then create mostly random documents on hacked or temporary domains for no apparent reason. You wouldn’t know this was happening if you never used Google Alerts.
Have you ever caught anything? My guess is that when info leaks, it ends up on the dark web, i.e., password-protected or otherwise non-searchable by web crawlers.
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I’ll preface this by saying I don’t pick individual stocks anymore and never had that great of a record, but… I consider Seagate a huge loser in drive wars. First, they never had appealing HDD products (I’ve never owned one, I’ve only bought WDC and IBM). And second, they missed the ball on SSDs. By the time they get in (say via acquisition, as is their tradition), SSDs could cheap and with low margins just like HDDs. It’s a real gamble.
Have you guys looked at Uber? Any thoughts?
I enter alot of sweepstakes…and win occasionally. The search notifies me if it see’s several combinations of my name/location in case they post it and you have to claim the prize.
As for seagate, it’s alot more than JUST hard drives which I’m also not that fond of. They also do cloud storage [ Personal Cloud Hard Drive | Support Seagate US ] and several other things. With the largest ssd at a reasonable price ($175) being 2TB hard drives will continue to be in demand for archival and backup purposes. Additionally seagate is using new technology to release much larger hard drives that have the same footprint. [ Seagate Will Ship 18TB and 20TB Hard Drives in 2020 | PCMag ] It’s also down 30-40% related to covid and pays out a 5.76% dividend. (calculated from today’s closing price I assume since the article mentione 5.9%)
From the article:
HDDs are bigger, slower, less power-efficient, and more prone to damage than SSDs, but they’re significantly cheaper. Instead of competing against SSD makers, Seagate pivoted away from the lower-capacity consumer market and focused on higher-capacity HDDs for enterprise and data center customers – which often prioritize prices over raw speed.
Uber isn’t paying a dividend and has pretty much already recovered from it’s march crash.(so growth potential is limited…doesn’t mean it won’t go up more but it’s nowhere near it’s 52 week low) I’m looking for stable dividends or stocks that have not yet recovered but should after the pandemic goes away or are recession proof…for example AT&T which has both a nice dividend and will continue to have revenue whether we are in a recession or not as people will continue to use phones and internet etc.
Oh I’ll add I’m not taking any credit for picking these stocks. I followed alot of the posts from motley fool and paid attention to stocks that were repeatedly mentioned across multiple articles. The 3 that took off like they were on fire, The Trade Desk, Square Inc and Alteryx (and slightly further back AbbVie) were all mentioned multiple times as “mush buy’s” across months.
I’ll throw an idea out there… Cigarette stocks like MO BTI PM.
They pay 8.5% dividends that are easily covered by cash flows. In the US they are a government protected oligopoly protected from competition due to the Master Settlement Agreement.
When the share prices start to recover it could end up providing 15-20% annualized returns.
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I know they pay well but I have difficulty being in stocks that I know kill people. My own father died as a result of lung cancer even after he had quit smoking for 15 years because of the length of time he did smoke before that and had to deal with emphysema.
For something similar but less morally troubling you might try this: (these are diversified CEF’s [Closed End Funds])
Wells Fargo is another I know is well liked and in funds like Berkshire Hathaway. It has a great dividend but my experience with the company has been CRAPPY to the point I pulled ALOT of money out of their bank and brokerage services and moved it to a roboadvisor. I can’t make myself buy their stock. Add in the scandals and it’s one I’ll personally avoid like the plague.
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That’s a home “cloud” – a consumer NAS. I don’t think it’s a very big market, and it’ll get smaller as SSDs become cheaper.
Businesses are moving their “data centers” to the cloud, so the biggest customers are probably the few cloud storage providers.
The dividend yield is high because the market expects the dividend to not last, and the shares to lose value. I mentioned in the COVID thread that more people quit smoking because of this epidemic than for any other reason ever before.
If you read the articles I linked it indicates they are doing enterprise level cloud storage as well. So don’t invest in it. I make no money based on whether you do or don’t…my portfolio is up 38.80% as of today.That’s not counting the ongoing reinvested dividends. Set one up and we can compare in a year using percentages so the amount of funds for each doesn’t matter.