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?