Even though I spend a lot of my time thinking about and writing about dividend-focused strategies, I’m definitely not opposed to strategies that involve focusing on profit growth in general without much consideration of the dividend. How can I criticize people who have been holding Berkshire stock for 30+ years? They are more financially successful now than I will ever be. I don’t want to throw stones at people who are better than I am at investing.
But I do think there is an appeal in having cash come your way on a regular basis, organically through the profit sharing structure of dividends at the high-grade American companies. If you accumulate 25,000 shares of Philip Morris International, you are going to collect $94,000 in dividends (plus you pay taxes). That creates options for you–without working, you get to live on the salary of the average American household (low $50k’s) and you get $20,000+ coming your way each year to fund new investments. If you want to spend your life being a capital allocator, it seems to me that income investing is the way to go.