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Mutual Fund News


Special to The Globe and Mail



Semi-retired freelance writer

The portfolio

Includes shares in Exxon Mobil Corp., Johnson & Johnson, Procter & Gamble Co., Bank of Nova Scotia, Royal Bank of Canada, BCE Inc., Chevron Corp., General Mills Inc., Coca-Cola Co. and General Electric Co.

The investor

Mike Nadel was a newspaper journalist for 30 years until he was laid off in the 2008 recession. Now he writes freelance articles for investment website and works part-time at a golf course. The kids are grown up, there are no debts to pay and his wife has a secure job.

How he invests

Mr. Nadel and his wife are invested in several dozen blue-chip corporations with "long histories of dividend increases." Along with a modest pension and social security payments, the dividends are expected to provide enough income for a comfortable retirement in the United States.

They are already receiving $25,000 (U.S.) annually from their portfolio. Its average dividend yield is greater than 3 per cent and growing at more than 5.5 per cent a year.

Their target is $36,000. It won't take long - just reinvesting the dividends will get them there within five years, as calculations by Mr. Nadel show. What about inflation? Then it would take about 10 years to reach their "number" in today's dollars (assuming inflation of 4 per cent). Add in the couple's annual contributions and the journey should be a lot shorter.

"While market forces will move the portfolio's value up and down on paper, I expect our income to grow through good times and bad," Mr. Nadel says.

"We never should have to dip into the principal for our needs and wants, and we should be able to leave a financial legacy to our heirs."

Best move

It was being a good saver while working as a newspaper journalist and investing "no matter what was happening in the world around him."

Worst move

"... getting swept-up in dot-com fever just before the tech bubble burst in 2000."


"Buy only what you understand, have investments that let you sleep at night and make decisions for yourself after doing your own homework."

Want to share your strategies?


© 2007 The Globe and Mail. All rights reserved.

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