Automatic Income Machine Presell Transcript #3

 

 

                   Video #1  | Video #2  |  Video #3  |  Video #4

 

 

Hi everyone.  This is Tim Plaehn again.

This is the THIRD in a series of three presentations about what I believe is the single most effective investing method for ordinary people…

…  and a sure-fire way to get both the income and the returns you need to grow your wealth and generate a substantial income.

This approach is also one of the primary secrets of some of the world’s most successful investors – such as Warren Buffett.

Now, if you’re just joining… or even if you’ve watched my previous two videos already… let me briefly recap what this approach is all about…

If you’ll recall, I told you that the single most important factor in investing is to… MAKE MONEY.

And by that I mean, your investments should generate CASH INCOME – and, what’s more, should generate MORE AND MORE cash income each and every quarter.

As I said in the first video, CASH is KING.

That is the SECRET to being successful over the longer term.

As a former F-16 fighter pilot, I learned to keep my attention on what really matters – to keep my eye on the ball, if you will.

And in investing, what really matters is INCOME… making money.

I explained in the previous videos that if a company makes you money consistently… and more importantly, makes you MORE AND MORE money each quarter… then all of that what I call “money pressure” eventually FORCES a stock price upwards.

Stock prices rise and fall depending upon the overall mood of the market… and the general economy.

But eventually, stocks that consistently make you more and more money each quarter rise in value.

And I showed you in an earlier video a simple mathematical calculation you can use to determine the RATE OF INCREASE for the income a stock makes you.

You simply take a quarterly or annual stock dividend at one point… and then the quarterly or annual dividend at another point in time, such as right now… and you use an annual compound return calculator to calculate the annual INCREASE in the dividend payments.

I explained that I want to see an annual rate of increase of AT LEAST 12% a year… for at least four quarters in a row… before I will even CONSIDER investing in a stock.

I also showed you how eventually these rapidly increasing dividend payments affect the stock prices as well – and so we can realistically shoot for an average annual return for our investments of 12% or more.

And I explained that this is ESSENTIAL going forward… because index fund investing is increasingly looking deader than a doornail… and that top experts, such as Vanguard Founder Jack Bogle, are predicting average returns for the stock market as a whole of about 6% — or about HALF of what they’ve been over the past 30 years.

However, the good news is that… using my RISING DIVIDEND method of investing…

… we can get and even beat those historic averages…

… and THAT means that, even if you don’t have a lot of cash saved yet, you CAN start right now building a steady income stream… live independently… stop worrying about money… and enjoy life.

Now, in my second video, I explained in detail how I go about finding and selecting the right RISING DIVIDEND stocks.

But in this video, I’d like to reveal how I SPEED THINGS UP…

… the tricks and techniques I use to accelerate the creation of multiple streams of income…

This is stuff I RARELY reveal to anyone… and it can be a bit technical.

Now, a little later I’ll tell you about a new service I am creating that will AUTOMATE this entire system… and make it so simple that a freshman in high school could use it.

I call this new service the AUTOMATIC INCOME MACHINE – or “AIM” for short.

I’ll tell you more about that in a moment.

But first, I want to show you how I take the RISING DIVIDEND approach I revealed in the last two presentations… and basically kick it into high gear… supercharge the results so you are able to create multiple streams of cash income with money coming in MUCH faster…

So, in the next few minutes, I’m going to show you 4 things:

FIRST, I’m going to show you…How to set up a system to find the stocks with the highest dividend growth rates.

THEN, I’m going to discuss the relationship between current yield and dividend growth.

Third, we’re going to look at… how long you should hold on to your high growth rate stocks.

And then, I’m going to put it all together and show you a different way to measure the success of your investment strategy.

Finally, I’m going to tell you a little about the Automatic Income Machine – and why I’m so excited about what it’s going to do for typical investors.

So, let’s get started.  We don’t have much time and I have A LOT of amazing things to show you…

Okay, so the first thing I want to talk about is…my system for finding and selecting high growth rate stocks to buy.

As I discussed in the last video, I build my own databases of stocks in the various high growth categories.

The key data points for these databases are those with current yield and one-year historic dividend growth rate.

I use a proprietary query to “sort” and rank them into different columns.

The usual first step is to rank by dividend growth, from high to low.

I make a point of doing my own growth calculations.

With every dividend announcement, I pull up the corresponding entry in the database and update the dividend growth percentage for that stock over the last year.

By sorting the stocks by dividend growth, those with the highest growth rates rise to the top of the list and are the stocks I review first for investment potential. These are the ones I zero in on first.

I really dig into the financials and guidance of the individual companies to see if the growth can be sustained into the future.

This is where my years of experience as an investment adviser and stock broker really pay off.

Is all that clear?  Good.

Now, the second thing I want to share with you is that you need to be aware of the relationship between current yield and dividend growth.

High growth rate stocks will often have lower yields.

The low yields make these stocks unattractive to some investors, but we are looking for 15% to 20% or higher dividend growth, which will produce those high total returns.

The “market” is aware of the growth rates, so it will price shares accordingly – low yield with high growth.

If you find a stock that has a high historic dividend growth rate and an above average yield, that is actually a warning flag NOT to buy the stock. The high yield tells us that the growth has most likely stopped or slowed significantly.  These are the high-yield stocks that typically plummet in value after you chase the double-digit payment rates.

The next important thing for you to know is how long you want to hold on to the shares of the stocks you select.

Stocks like Kinder Morgan Energy Partners that grow dividends at a high rate for a couple of decades – the so-called “Dividend Aristocrats” you sometimes hear about – are rare.

More typically, a high growth rate can be sustained only for several years. At some point, the company will enter a slower growth middle stage.

My system sets an initial hold target of around two years.

By then I will have a good handle on the company’s continued growth trajectory.

If the growth in the dividend is slowing after two years, it’s time to sell and replace that stock with a new, higher growth rate prospect.

Remember that these are often new companies spun off by larger “parent” or sponsor corporations.

This is very important to remember: There will always be new, high-growth-rate income prospects coming into the market with IPOs and spin-offs that go into our databases to be followed as they develop a growth track record.

Following me so far?  I realize we’re covering a lot of ground very quickly… but I want to give you as much useful information as I can.

The last piece of the puzzle is a different and unique way to track your investment results.

If you have been in the market long enough, you know that there are times when share prices drop, and sometimes drop rapidly.

I am like every investor and I hate the feeling I get when I see a lot of red in my brokerage account returns screen.

However, I know that with my rising dividend strategy, the growing dividend payments will eventually pull the share prices out of whatever temporary market correction is going on and produce positive returns over a longer time frame.

To make sure I remain on track with the strategy and don’t let my emotions cloud my judgment, I track my dividend earnings in detail.

Each quarter I total the dividends paid by my high dividend growth rate stocks.

That dollar amount of cash earnings goes up every quarter, usually by several percentage points quarter-over-quarter.

Each year, I compare the dividends earned to a year ago and make sure that I earned at least 12% or more than what I earned a year earlier.

This is real, cash income growth.

I know without a trace of doubt that this rising pile of cash income will eventually raise the underlying prices of the shares. The share prices may lead or lag the dividend growth… but what I know for certain is that math is math, and dividend growth will eventually generate the total returns we want for building real wealth.

Now, as you can see, some of this gets a little complicated.

You can definitely do all this on your own… but it does take quite a bit of time and more than a little analysis and thought.

I’ve given many live public presentations and held seminars about my RISING DIVIDEND investing method – when I didn’t even share all of what I’ve shared with you today.

And people come up to me afterwards and say, “Tim, this is what I’ve been looking for… for YEARS… but I don’t know if I can do this on my own.”

And trust me, I get that.

There’s a lot to absorb.  I’ve been developing this automatic income machine over the past 20 years.

What’s more, when you realize that INDEX INVESTING just isn’t going to give you the returns you need… and that you can create multiple streams of cash income while ALSO building up your core wealth step by step…

I understand why people are frustrated.

So after many months of planning, I’m about to launch a “done for you” version of the accelerated automatic income method I’ve shown you in these videos.

As I said, I decided to call it the Automatic Income Machine… because that is precisely what it is:  an advanced technology for creating multiple streams of automatic income…

… income that can support you… whether you’re already retired… just a few years away from retirement… or even decades away… and that will build wealth along the way.

Now, as someone who has taken the time to read one or more of these presentations, I want to give you a substantial reward.

And that reward is this:  I’m going to let you CUT TO THE FRONT of the line and be among the very first to learn about the Automatic Income Machine.

This is NOT going to be a mass market investing service.

Far from it.

In fact, it’s designed to be a VIP private coaching program.

I’m going to allow a limited number of people to literally look over my shoulder and put into practice the IDENTICAL investing program I use for myself… the same program that lets me earn MORE than 12% a year consistently… year after year… even in a down market.

I’m going to show you EXACTLY what to do… exactly what stocks to use… and how to set it up so you create multiple, growing streams of automatic income… no matter what.

So, here’s something very, very important: Please keep a lookout for an email with the code word [AIM] in the subject line.

This is my way of signaling to people who have watched these videos and know what I’m talking about.

I’ll send this email in the next day or two… so keep an eye out.

Not only will it give you all the details about my Automatic Income Machine service… but it will also let you try it without any risk whatsoever.

So, that’s that.

In the meantime, I’d like you to do some homework.  If you haven’t done so already, spend some time on the Mutual of Omaha’s “Are My Retirement Savings Sufficient” calculator. You’ll find a link at the bottom of this presentation.

Plug in some of the variables: your age, when you want to retire, how much money you’ve saved, and so on.

If you’ve got 30 years before you retire, find out how much money you’ll end up with if you can make 12% a year CONSISTENTLY.

If you’re already retired or only have five years before you retire, take a look what a 12% annual return can do for your overall financial situation.

And then… spend some time thinking about what all this means for you and for all those you care about.

As I said earlier:  returns matter… a lot.

And keep an eye out for that email with [AIM] in the subject line.

This is Tim Plaehn again.  Thank you for reading.

Click here for the “Are My Retirement Savings Sufficient” calculator