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Collin Harness

@harnessmoney

Should you invest in growth or dividend stocks

Should you invest growth, dividends or both?

Curious what other people think.

Growth stocks may increase in value more than dividend stocks, but dividend stocks provide cash flow. That cash flow can be reinvested to create more cash flow.

    1. Growth stocks are generally younger and have a lower current valuation, but higher long term return potential

    2. Established business like Walmart and Coca-Cola pay dividends, but maybe not as much growth

    Is it better to receive cash and then reinvest it?

    3. Both dividends and capital gains are taxed at a lower rate than personal income

    4. In theory a person could live off dividend income, if they own enough shares

    5. With growth stocks you would need to sell off your stocks in retirement to live

    6. Do growth stocks actually grow faster than older established stocks or is that a myth?

    7. I don't want to invest in businesses that I do believe in via an ETF, but I also want a little bit of diversification and not be too concentrated. How many assets should I hold?

    8. Are dividends better or worse than share buybacks for a business?

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