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Multiple Purpose Stock Dividend Investment Funds

All of my stock dividend investment funds are multiple purpose investments!

By multiple purpose, I mean that while the dividends from funds may be primarily designated for one specific purpose (like paying for lunch out with the guys at work) in good times, if bad times come along (say suddenly I’m laid off), those same dividends could be used for a second or third purpose, depending of the magnitude of the bad times.

I don’t talk much about my regular dividend investments, but eventually I would like to have dividends funds that could pay for the following purposes: vacations, Christmas gifts, eating out, etc.

Now I know what people are thinking.  If I spend all the dividend money on the entertainment list above, the fund would be never grow and lose ground to inflation eventually.  That’s true, but I’m still going to be investing the money from my job into them; I want the funds to continue to grow!

So while currently the purpose of most of my stock dividend funds are for entertainment, they also have at least one other purpose that I keep in back of my head at the same time.  If my “Oh crap, that happened” fund purpose!

I also have other levels for my funds, but you get the basic idea…

So if an emergency does hit, the above funds would be uses as follows:

  • Vacation Dividends Fund would go for real estate taxes and groceries
  • Christmas Gifts Dividends Fund would go for groceries
  • Eating out Dividends Fund would also go for groceries
  • At Work Lunch Dividends Fund would go for gas for the cars

As I create more and more dividends funds, they too, would have multipurpose roles.

Ideally, I’ll be able to fix the issue that’s causing me to deviate from the intended purpose of my dividend funds.  But being able to use these funds for an emergency backup purpose give them a great degree of flexibility!

Do you have multiple purpose investments?

-MR

8 Responses to Multiple Purpose Stock Dividend Investment Funds

  1. I don’t have any targeted investments.

    Right now all our dividends except one are set to drip. (Well, technically we have one share of AOL and 4 of some kind of time warner that aren’t dripping. I guess I didn’t want to deal with the tax headache of selling those this year.) They’re all broad index funds we’d be investing in anyway (except the one that isn’t dripping) so in the absence of needing the money it might as well reinvest itself.

    The hope is that we’ll get enough money in dividend stocks that we can take more risks with our jobs (specifically DH’s job) without diminishing our quality of life. But that will take a while.

    • My trick is just fun, money is money, but it’s a good measure-stick, to motivate me.

      I also have that magic crossover point defined… I’m such a finance geek 😉

  2. Yes, we have several targeted funds, and in the event of an emergency, they would be fair game. Otherwise, I’m happy to have them continuing to fulfill their “purposes.” 🙂

    Technically, we have never “touched” dividends, but getting them do make me feel a lot more comfortable spending!

    • It probably wouldn’t surprise you to learn that I do the same huh 🙂

      The exception is my lunch dividend experiment. But I haven’t really touch that yet either, but I may in the future.

  3. I am still investigating dividend funds. I plan on making a decision by the end of the week.

    I have general investments that are there in case we need them. However, I do not have anything targeted for any one purpose, outside of college. (but that is my 529 plan)

    • I do stock dividends but I also diversify my investements in regular stocks, bonds and other such devices.

      I take it all in… 🙂

  4. Oh yeah, technically we do have targeted funds in the 529 umbrella (DS’s education) and targeted funds in the IRA/403(b) umbrella (retirement). But not outside.