How To Keep & Grow Your Money #22

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In this letter, we analyze the Vanguard High Dividend Yield ETF (VYM).

Ticker: VYM | Price: $131.87 | Market Cap: $76.5B | Average 10-Year Annual Return: ~10.17% (as of December 2024)

What is it (short)?

The Vanguard High Dividend Yield Index ETF (VYM) focuses on U.S. companies with higher-than-average dividend yields, offering investors steady income and exposure to mature, established businesses.

What is it (long)?

VYM tracks the FTSE High Dividend Yield Index, which includes large- and mid-cap U.S. companies that pay above-average dividends. It excludes REITs and prioritizes sectors like financials, healthcare, and consumer goods. With a diverse portfolio of stable companies, VYM is designed for investors seeking a blend of income and moderate capital appreciation. Its low expense ratio and passive management make it a cost-effective choice.

Our thoughts:

VYM is a great option for income-focused investors looking to balance consistent cash flow with long-term growth. It works well in retirement portfolios or for those aiming to reinvest dividends.

Do your own research and if you would like to take our free course to learn how to invest into ETFs and Index Funds at Index Institution™ go here.

Exploring Alternative Citizenship Options

Safe… Stress-Free… Future-Proof…

That’s what the right second citizenship can do for you.

But there’s no one-size-fits-all solution. Here’s a breakdown of popular options in 2024 for second citizenship programs that cater to different needs:

1. Malta Exceptional Investor Naturalisation (MEIN): Offers an EU passport with visa-free travel to 180+ countries. It’s costly (~€700,000+), but ideal for those prioritizing EU mobility, top healthcare, and education.

2. Turkey Citizenship by Investment: A strategic passport with real estate investments starting at $400,000. Benefits include access to the U.S. E-2 visa and visa-free travel to 110+ destinations.

3. St. Lucia Citizenship by Investment: A budget-friendly option (~$240,000 donation or bonds). Perfect for individuals seeking simplicity, speed, and strong global mobility.

4. Grenada Citizenship by Investment: Unique for its E-2 Visa treaty with the U.S., Grenada also offers visa-free access to Russia and China. Investments start at $220,000.

Other notable programs include Antigua & Barbuda (family-friendly and affordable at ~$260,000) and Dominica (affordable, with no minimum stay required). Each program varies based on costs, benefits, and processing times​.

Choosing the right program depends on your goals, from enhanced travel freedom to better investment opportunities.

If you would like to explore legally paying less taxes and maximizing your freedom check out Global Optimizer™ or click here.

Financial concept to learn in this edition: Opportunity Cost

What Is an Opportunity Cost and Why Does It Matter for Investing?

Definition: Opportunity cost represents the potential benefits or returns you miss out on when choosing one option over another. In investing, it’s about weighing the value of an alternative investment you forgo when committing your resources elsewhere.

Types of Opportunity Costs in Investing:

• Forgone Returns: Choosing low-risk bonds over stocks may mean sacrificing higher potential returns.

• Lost Time Value: Holding cash instead of investing can result in missed compounding opportunities.

• Trade-Offs in Asset Classes: Investing in real estate might mean forgoing liquidity and faster returns available in equities.

Why Investors Care:

Understanding opportunity cost ensures you’re maximizing the value of your financial decisions. It helps in evaluating whether sticking with one investment strategy is worth the potential gains from another.

Key Considerations for Investors:

1. Compare Alternatives: Always assess the potential returns and risks of each option.

2. Factor in Time Horizon: Opportunity cost grows over time, so long-term decisions are critical.

3. Use Data: Rely on financial metrics and trends to estimate potential returns accurately.

Opportunity cost ensures smarter allocation of resources, helping investors make more informed choices.

To learn more about Opportunity Cost read more on Investopedia here or learn more from our full FREE investing course & community here.