So then, what else? I would argue that a company that just pays a dividend isn’t good enough. Instead, I will only purchase those companies that have a long history of raising their dividend every year. This will eliminate a whole bunch of risk. It would eliminate possibility that company is ‘cooking their books;’ after all, money has to be there to pay shareholder. And because this company has been raising their dividend every year for many years, it eliminates risk of investing in a start-up company that may not even be around in a year or so.

Also, rising dividend every year would help off-set risk of inflation and risk of a lower stock price during year would actually accelerate my income from security.

Since I would want my position in stock to grow through years, thus increasing my dividend income, all dividends would be reinvested into stock, until retirement. A lower stock price, therefore, would purchase more shares, at a higher dividend yield and would simply accelerate my dividend income.

Now question may arise, when would I want to sell a stock? Certainly not because a Merrill Lynch has downgraded whole sector – that’s a blessing in disguise – a temporary lower stock price just means a higher dividend yield, allowing my dividend to purchasing more shares.

The question of when to sell a stock puts me in mind of a quote I once read by Jacobsen – “Judgment is one thing you cannot learn at college. You either have it or you don’t have it.” The time/reason to sell a stock varies. If there comes a time when you have so much money tied up in just one stock position that it’s making you feel uncomfortable, sell some of it. If company you purchased stopped raising its dividend you may want to lighten up and/or divert funds you were putting into that security into one that is continuing its program of increasing their dividend every year.

A company may trim their dividend – when and if this happens (and it does) my advice is not to be overly anxious to sell stock. Find reason why company is trimming their dividend. It may be to reduce debt or for possibility of acquisitions. The company’s dividend yield may have been around 6 percent, and all their peers’ dividend yields are around 4 percent. Certainly do not add to your holdings in this company, but give management a chance to see how they handle extra cash, since they appear to have better use for money, other than to pay their shareholders. The resulting growth in that company may make up for lower dividend yield and two or three years later you’ll get a better perspective on whether to sell company or not (or to continue adding more shares through new monies, or simply to allow dividends to continue purchasing stock).

For more excerpts from book ‘The Stockopoly Plan’ visit http://www.thestockopolyplan.com

It reminds me of movie from a few years ago, "Hunt for Red October".

You might remember scene where American officers have just come onboard Russian sub. In process of turning over his ship, sub is attacked by another Russian sub. With Americans at helm and on sonar station Russian sub captain assumes command. He orders sub turned toward direction of fired torpedo and moves toward it.

The American officer is yelling and threatening sailors. He is certain this is not course of action to follow. However they obey instructions of Russian officer. They meet torpedo head on and it bounces harmlessly off hull of sub.

The American officer realizes what has happened. They were able to close distance with torpedo before it had a chance to arm itself. Upon reflection, his response was two words, "Combat Tactics".

How does this apply to you? You need to meet your debt head on, not run from it. Take care of it before it has capacity to destroy you. Even with family members "screaming and threatening" you need to turn your ship to decrease distance debt stretches in your future and assume "Combat Tactics".

This is a great challenge. That's why you should carefully decide how you spend your money. It is why you need to track your spending. It is why you should engage in aggressively paying down your debt. These things are "Combat Tactics" against debt. When that battle is over they can become your peacetime policy to purchase and ensure your future.

David Wilding http://www.debtattack.com Changing Attitudes Toward And Acceptance Of Personal Debt

David Wilding has, for the past ten years, been trying to help people rid their lives of debt. Through changing their attitudes towards, and their acceptance of, debt in their lives, he has help many to reach the goal : living debt free. Visit his website http://www.debtattack.com.