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...If you have some useful rule of thumb, methodology or math formula that incorporates that 25% tax, and/or suggested method of thought about how to select those II recs that will be an optimal addition in favor of a non-dividend-paying rec, I will be grateful if you share it....


I'm not familiar with the rules of your tax situation, so one thing I would ask is whether the 25% tax applies to MLP distributions as well as normal dividends.

Another thought ( from a net dividend after taxes standpoint ) is that you may want to look at the normally higher dividends from REITS, if they are all taxed the same.

As I understand it, your strategy focuses primarily on capital gains versus "current income". However, please understand that many of us here are not focused on "current income"; rather on building a dividend stream that grows faster than inflation so that when we retire/start to use these funds, they cover most/all of our living expenses without regard to stock prices at the time. The dividends we receive are plowed back into building this stream versus spending the dividends now.

Another thought for you: many studies have shown that over the long run, dividend paying stocks have outperformed non-dividend payers in total return. Indeed, some 40% of the markets returns over the long run have come from dividends.

Certainly other TMF services focus more on capital gains than II does (SA, HG, IV, etc.,), but for me, I wish I had adopted the dividend growth strategy when I was 35 versus at 57 when I did ( now 67 )....because I would be a whole lot better off. ;-)

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