Interview: Financial Independence Through Dividends and Thrift

Posted by 26 January, 2009

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This is an interview with William Spetrino. He is financially independent through through investing in dividends, being smart with his money, and doing right by others. You can read more about him on his Squidoo page or his blog.

Question: Can you tell us a little about yourself?

Answer: In college I was an accountant who graduated at the bottom of my class. In finance we learned the efficient market theory which meant throwing darts was as important as analyzing stocks. In 1987 I was first introduced to Warren Buffett and tried to read as much as I could. In the absence of the internet gathering information was not easy. What you are able to learn now in a month it took me over 10 years to learn. In 1988 I started with sports memorabilia but the problem is most of profits went to pay for living expenses. DON’T quit your job until you have at least 1 year of living expenses. In 1993 I finally got started with 7000 dollars and it all took off from there and was a slow steady grind until 1998 when I realized the internet’s vast amount of information was able to speed up my learning process.

Question: You have stated you are financially independent. What does that mean to you?

Answer: Financial Independence is knowing that your annual dividend income EXCEEDS your total living expenses. More importantly if you build your dividend machine “properly” the income should double every 6-10 years which should more than keep pace with inflation

Question: I really like the idea of living off of dividends. What got you interested in dividend paying stocks? Also, why dividend paying stocks? Why not real estate or some other avenue that offers cash flow while preserving the capital asset?

Answer: In 1993 I bought the stock that is now Altria when it had its dividend yield of 5.75% and a low PE. That original investment 15 years ago with reinvested dividends will pay me about 60% in 2009 of the original amount invested. That got my attention. And then if you go on my squidoo lens http://www.squidoo.com/Creating-Dividend-machine you will see Jeremy Siegel’s study of the top performing stocks with reinvested dividends. Let me just add I bought Altria more than 10 years before I read his study, but reading it made see the power of it. Siegel also said that 97% of the Dow’s gain since 1900 was because of reinvested dividends and 3% was ‘appreciation”. That made a lot of sense to me. Real estate is something that is capital intensive, you need to involve attorneys, contractors and was the way I thought wealth was to be developed in the 80s and early 90’s. But as time went on I realized that buying stakes in companies like Altria, Coca Cola, Johnson and Johnson when they are PRICED RIGHT is the easiest way to financial independence.

Question: We’ve spoken on the phone a few times and stressed the power of networking. Can you share you experiences in networking and how that has gotten you where you are today?

Answer: Networking is summarized in my book Consume Consume and Consume More which has been sold in over 15 countries and is now starting its second printing. Check out the reviews http://www.atfreeforum.com/billyticketswin/viewtopic.php?t=17&start=0&mforum=billyticketswin. Whats ironic is the 2 people who have helped me along the way were people I tried to sell an insurance policy to. Thankfully BOTH of them remembered my words. If you ever need ANYTHING at all. Please call me. Both people who are opposite as can be helped provide two separate income streams which provided me the finances to build my dividend machine. Listen closely to this story. When I used to tell one of my old mentors that I was more interested in helping others than selling he asked me if I believed in our product and I said sure. He said then well if you aren’t sharing the product WHO are YOU helping? That made me realize that waiters, construction workers and everyone I came in contact with was fair game. However I do it differently. Most people try and “push” one thing. I build a network of “generous”, positive , competent people and then I expose products to them. THEY will decide what they want. Remember No one loves to be “sold” but everyone LOVES to buy.

Question: I know that you are not a broker and can’t offer financial advice, but are there any dividend paying stocks you would suggest people investigate?

Answer: Unlike a broker who has a vested interest in what and how often you buy I will recommend companies that you understand. Pepsi Coca Cola McDonalds Altria Proctor and Gamble etc. The KEY is what PRICE you get the stocks at. In my book which can be ordered at ticketbill@aol.com gives the EXACT formula and filters to tell you WHEN and WHAT to buy.

Question: Is there anything else you’d like to add?

Answer: My book will teach you how to start with NOTHING and achieve financial independence by following each step that is SIMPLY stated. The book is less than 50 pages but is full with MEAT which took me 20 years and over 1000 articles and books worth of reading to amass. There is a case study from almost 4 years ago where I analyzed 5 stocks and the 2 stocks I “recommended” are BOTH up even though the stock market is down drastically in that time span. My blog is at www.billytickets.blogspot.com. Feel free to submit questions an we can see how many we can get to. Peace.

Contact Information:

William Spetrino

E-mail: ticketbill@aol.com

Squidoo Lens: http://www.squidoo.com/Creating-Dividend-machine

Blogs: www.billytickets.blogspot.com

His Forum: http://www.atfreeforum.com

Photo by: Epicharmus

Other Posts:

10 Ways to Become Financially Independent
What Would Happen if More People Were Financially Independent?
10 Reasons Why I Want You to Be Financially Independent
Will Your Ambition Beat You?
What’s the Best Financial Decision You’ve Made?


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Comments
January 26, 2009

I bought PFE and a few other high yield stocks and got screwed when they cut the dividends.

Nothing works all the time.

Posted by Mary King
January 27, 2009

Hello Mary!
I don’t think he intended to say that all dividends work and all companies are applicable all of the time. Bill employed a methodical routine in choosing the stocks that he chose.

A lot of companies are cutting their dividends right now, but a lot of companies dividends are doing just fine. Be sure to do your homework before investing in a company. You’re right, nothing works all of the time and there are always exceptions to the rule. Thanks for the comment!

Posted by admin
January 28, 2009

Interesting interview. Dividend Growth Investing does work, but one has to look for stocks that continuously increase their dividends every year, and whose business models support such an increase.

Dividend Growth Investor’s last blog post..Dividends and The Great Depression

January 28, 2009

This was a nice look into exactly what I want to do. Though I’m hoping to achieve this with a mixture of appropriate stock investments, and real estate that should recover.

Thanks for a good read.

PennySeeds.com’s last blog post..A little birdie told me to day trade with Twitter.

Posted by PennySeeds.com
January 28, 2009

The way you present your ideas can truly inspire and empower your readers. You may be interested in reading some of Stephen Hopson’s posts at the Adversity University blog. He used to be a wall street stock broker himself until he changed his career focus. Stephen has recently interviewed a man named Michael who also left wall street to pursue a different dream. Let him know your thoughts. You may find you have a lot in common.

Liara Covert’s last blog post..How do you discern your lessons?

Posted by Liara Covert
January 28, 2009

@ Dividend Growth Investor – I most certainly agree. I’m not sure banks would qualify as a strong dividend play at this point given their vulnerability. Thanks for the comment!

@ Penny – We own quite a few dividend paying stocks now, but I hope real estate is my focus in the near future. I agree that a mixture of investments is a must. Thanks!

@ Liara – I will definitely have to check out Stephen’s blog. Sounds very interesting. Thanks for the tip!

Posted by admin
January 28, 2009

Very interesting interview. I have to agree with Williams comments about networking as a powerful relationship builder.

The key is that powerful relationships are built by simply “being of value to others” rather than trying to sell your wares.
It’s important to focus on how you can help others reach their goals and ambitions. Just my 2 cents!

Monica’s last blog post..7 Keys To Turn a Financial Crisis Into Your Best Opportunity

Posted by Monica
February 2, 2009

Mary I don’t just buy stocks based on the dividend.I think management was wrong to cut the dividend but buying PFE below 15 will work out fine if you a long term investor IMO.

Posted by Bill Spetrino
February 2, 2009

Dividend Growth Investor what you say is true. The key is choosing stocks with predicible earnings that are priced right. My book has a formula that helps you.

Posted by Bill Spetrino
February 2, 2009

Thanks Penny. Remember I started at age with 9000 dollars. It can be done with the patience and pesistnce.I know beause it happened to me

Posted by Bill Spetrino
February 2, 2009

Thanks Liara.As amotivational speaker and someone who has become financially independent,I enjoy “meeting” those with similar goals.Thanks for the headsup

Posted by Bill Spetrino
February 2, 2009

Monica couldn’t agree more. Most sales people concentrate on themselves and their product. Love what you do and deliver more than you promise

Posted by Bill Spetrino
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