The Little Book of Big Dividends: A Safe Formula for Guaranteed Returns

by Charles B. Carlson, Terry Savage (Foreword)

Everyone needs to invest, but where do you invest during bear markets?

The massive stock declines over the past year have eroded savings, but this doesn't mean you should stuff your money under a mattress. It needs to be put to work getting some return so that it will grow.Smart investors will turn to high dividend paying stocks to get a stable and growing stream of income. Dividend investing-that provides an income beyond any gain in the share price-may be the investor's best weapon. Dividends are safe, largely reliable, and maybe at the their cheapest levels in many years. While the best paying dividend stocks of recent years, such as financials, took a huge beating in 2008, opportunities will abound in 2010 and beyond-if you know where to look.In The Little Book of Big Dividends, dividend stock expert Chuck Carlson presents an action plan for dividend-hungry investors. You'll learn about the pitfalls, how to find the opportunities, and will learn how to construct a portfolio that generates big, safe dividends easily through the BSD (Big, Safe Dividends) formula. If you're a bit adventurous, Carlson has you covered, and will teach you how to find big, safe dividends in foreign stocks, preferred stocks, ETFs, real estate investment trusts, and more.Contains the simple tools, strategies, and recommendations for finding big, safe dividendsHelps you put a complete portfolio together that pays dividends every monthShow you the top dividend paying stocks with their dividend payment datesIt doesn't get any easier than this, and in these turbulent times, you can't afford to ignore the power of dividends. Read The Little Book of Big Dividends and gain a better perspective of how you can protect yourself for the future.

Genres: Finance, Business, Nonfiction, Audiobook, Money, Economics, Personal Finance

208 pages, Hardcover

First published January 21, 2010

About the author

chartered financial analyst

Reviews

[Jay French · Rating 2 out of 5]

I have enjoyed Charles Carlson’s books over the years as I introduced myself to investing. I read this book, now ten years old, to see if I could learn something new or to get a reminder of the right way to invest in individual stocks. The thing is that the world has changed in the past ten years. There are now more ETFs and mutual funds that have a variety of dividend-based investing that embody something akin to Carlson’s algorithm. That’s for those that will consider these kinds of investment choices. This is now the era of index investing for many investors, limiting their interest in these kinds of sub-optimizing methods. It seems there’s less of a case to be made to use his website to help chose specific investments. Another difference is the lowering of stock purchase transaction costs to near zero. This fee reduction, along with fee additions and even cancellation for some DRIP programs also hurts Carlson’s thesis that DRIPS (dividend reinvestment programs) are great investments. And Carlson has a habit of providing specific stock advice which never ages well over a decade. So overall, while I liked reviewing Carlson’s take on evaluating stocks based on a variety of value and accounting measures, I’m not feeling the need as much as in past decades.

[Rob · Rating 2 out of 5]

Meh. If you've read a few articles on seeking alpha or other websites about dividends, you're probably familiar with everything this book will explain. I was turned off by the fact that there was a lot of repetition in an already brief book, that the author kept emphasizing the name of his website, but encoding it in the text" 'big, safe dividends', and that he proposed a 'simple formula' for stock valuation that was (A) payout ratio and (B) a rating number offered by (guess who?) his company. Also almost every other page mentions the crash in 2008, which means that this book probably won't age well.

Not worth it.

[Wilson Lei · Rating 3 out of 5]

The information given is pretty basic, with perhaps the formula at appendix B being reference-able. Some of the common sense and safety/risk knowledge are arguably timeless though and can serve as a nice introductory book. The stock picks offered in the book are probably dated though with the book seemingly written near 2008. Lastly the repeated mention of the authors website, and even the stock picks, are a bit of a turn off as these information doesn't teach the readers anything.

[Bobbie McLeod · Rating 4 out of 5]

Chuck Carelson
Dividend paying stocks will make you rich and they are available
Find stocks with above average appreciation and safe and growing dividends and buy at attractive prices
Through Brokers, or buy stocks directly
Get companies that increase dividends with inflation
Dividend reinvesting - forced buying
bigsafedividends.com
Dividend payments vary months
Larger firms are the ones that pay dividends
Payout ratio has highest weight for big safe dividend formula
Yield shouldn’t be the biggest determinant. High yield is predictor of dividend cuts
But before ex divided date and hold for 61 days
If a yield is too good to be true it is
Dividend growth potential
Rule of 72 divide yield by 72
Yield should be your second filter
More than 3% just say no
For stock selection
A company can’t pay if it doesn’t have the money
Stocks with total return potential
1. pay out ratio - measures how much of the company pays out. Can it maintain and grow. Stocks anual divided/full year estimate Available at Yahoo finance (earning estimate) Use 60% as upper payout ratio
2. Overall quadrant score - stocks total return potential. Momentum, quality, value, financial strength, performance
Focus on stocks that pay out 60% or lower
Want a quadrix score of 75% or higher
(Rates how well a stock will do)
Don’t pick stocks based on yields
Novomortis? - invest in pharmaceuticals (diabetes just keep increasing)
You can buy straight from the company and not pay fees for a broker
BUY DIRECT
Direct stock purchase plans (DRIPS)
To buy direct: contact company, read plan brochure (some have minimums, some have fees…) make initial investment, keep records

[Jeremy Gardiner · Rating 3 out of 5]

I just checked off "a book about money or finance" from my 2018 reading challenge. I read "The Little Book of Big Dividends" by Charles B. Carlson. I love compounding money and wish I was taught it earlier in life. Earning dividends is definitely one of the main strategies I plan to use for the rest of my life. I did learn a few things in this book which I was grateful for but I was expecting more (especially was hoping for some motivational content). The portfolio advice he gives is far too conservative for my liking (he likes 2-4% yield). My own recommendation if you're Canadian is to open a Tax Free Savings Account (TFSA) through Questrade. I like buying Exchange Traded Funds (ETF's) primarily as they don't incur trade commissions (on Questrade at least) and they are diversified. Won't go into specific recommendations on picks as I'm not an expert in this area. Put your money to work for you!

[Nagesh · Rating 1 out of 5]

This is not a book, it's a SCAM!
I'd have given a zero star rating if it were allowed. The utility of this expensive book is because of a website - created by the author - called http://bigsafedividends.com. Guess what, the website is unavailable or shutdown. Without the website, this book is useless as it asks readers to refer the rating of a stock, on this website, in order to make a final buy or don't buy decision.

The other information provided by the author is worth zilch. I don't know why anybody who's purchased this book has not sued the author, the publishing house & amazon.com for selling or participating in this scam.

Most importantly, Amazon.com did not post this review. They asked me to "edit and resubmit your review." Obviously, they want to sell & scam more people. Customers can go to hell.

[Jason W · Rating 5 out of 5]

Practical for most personal investor, esp for the retired, retiring and gonna be.

I like the Little Book series coz it’s practical. For this book, I must say, the title sounds dull but indeed extraordinarily practical, especially for the retired, retiring, and gonna-be. It helps to navigate thru out the minefield and literally share the manual for building your own fortress (sounds like Minecraft right). More importantly, author’s touch on portfolio construction and rebalancing helps the most. However, the tough part is we can stick with it, at least for that designated portion of the portfolio. .)

[kz · Rating 3 out of 5]

The little book on value investing was a better read with this work. There was some good tips for investing in this but most them have become mostly outdated since written (2010) as now there are commission-free brokerages that anybody can get on now like Robinhood or Webull (if you want a reference we can both get free stocks lol). A lot of his principles are fine. Not a complete waste of my time lol

[Brad Bevers · Rating 4 out of 5]

Interesting read, but dated now. He spends a lot of time talking about the dangers of brokerage fees, which are virtually nothing now if you want them to be. I mainly bought this because I have a couple of dividend stocks and was looking for a way to evaluate them - his system on his website that is referenced in this book was just what I was looking for. This is one I'll save and return to later when I want to focus on more dividend stocks. Recommended.

[Ivan Kuznetsov · Rating 1 out of 5]

Dangerous and misleading book... I feel the author does not really understand the capital allocation framework, and misses some of the fundamental principles of trade-offs (capital reinvestment vs share buybacks vs dividends). Basic and fundamental concepts like "intrinsic value", "margin of safety" are mentioned en passant, if at all.... The title "Safe Formula for Guaranteed Returns" should have, in itself, screamed red flags... Written by a CFA!!! Truly shocking

[Binfei · Rating 3 out of 5]

Good starting point for understanding dividends. It gave an idea and information on where to find key information about dividends. It also touched a little bit on building investing portfolio. However, this book will work better for whoever invest in US market as it provided a lot recommendation. For others, it is good guide to find a good dividend stock in your own market.

[Shum Wing · Rating 4 out of 5]

Great read even you’re not investing on the US market

I always wanted a easy to follow guide on evaluating stocks book. This gives me insight and easy to follow guide on how to evaluate stock performance, taking into consideration their future growth anticipation, not just on past and current performance unlike other books suggest.

[Hercules Merscher · Rating 3 out of 5]

It's a basic book to get you started on investiments thinking on dividends, and the things you need to pay attention to.
Definitely read it if you are a novice! If you have already read some books and understand a bit about the topic, it's not going to be useful for you, maybe 1 or 2 tips here and there but overall nothing that much helpful.

[Steven Dobrzynski · Rating 3 out of 5]

Not bad, but repetitive and half of the information is dated. It may have been more useful for a complete beginner or for the time it was written. It’s really one star for the amount of new information I got from it, but for a person new to dividend investing it may be a little more beneficial hence the 3 stars.

[Abdulrahman · Rating 3 out of 5]

لا بأس به كونه يحمل بعض الافكار الذي يمكن تطبيقها حتى وقتنا هذا و تناسب السوق السعودي. لكن جزء كبير منه اصبح )(عتيق) بسرعه مع تطور السوق حاليا. و ايضا كثير من الادوات و الافكار لايمكن تطبيقها هنا في السعوديه

[GEOFF · Rating 3 out of 5]

Quick read. Good investing philosophy for both dividend reinvestment or to create steady cash flow. Some formulas included to help find companies who have growth potential, while increasing dividend payouts. Also lists of companies that at the time of writing this book were top performers.

[Ryan Scott Drew · Rating 5 out of 5]

Easy quick informative read.

This book is a good foundation for formulating a dividend portfolio based on general guidelines that are plain and simple. He provides the reader with hazards to avoid and options to fit your personal situation and risk tolerance.

[فيصل كركري · Rating 4 out of 5]

A good book for those who are looking to enter the world of dividend investing. The author gave a wide range of ideas surrounding stock investing emphasizing on the role of steady stream of cash from dividends. This may change your way of investment strategy.

Worth the money and time.

[Arun Narayanaswamy · Rating 4 out of 5]

Though this is a very straightforward book on learning about dividends, it’s quite insightful and detailed.
It’s USA focused though and you will have to do your research if you are looking to map it to any other country

[Jack · Rating 4 out of 5]

OK, I liked Dividends Don't Lie (Geraldine Weiss) better

[Rae (Rachel) Lipkin-Bajor · Rating 3 out of 5]

I’m learning how to best understand my investing portfolio and this book feels out dated and the language isn’t very intuitive. But overall it’s helpful in a way.

[Mick · Rating 3 out of 5]

Nice read but too short

Not a bad book.
Would like to see a chapter on covered calls as well.
I believe the price is too high vs what’s on offer

[Yue Zhou · Rating 3 out of 5]

This book do mention some key points about dividend investment, but it is mainly directed towards US investors only.

[Kiril · Rating 4 out of 5]

3 stars for the book + 1 more star for the free website.
The comments of the other users say enough, so I'll spare my ink.

[Ivan Rocha Jr. · Rating 4 out of 5]

Nice book. Basic concepts of Dividends stocks.

[Fredrick Niles · Rating 4 out of 5]

A bit dated but the formulas, terms, and philosophy in general are all still solid.

[Dan · Rating 3 out of 5]

Great book that covers all the basics of dividend investing. Unfortunately, it is US-centric.

[Murtaza · Rating 1 out of 5]

The information is outdated

[Emily · Rating 4 out of 5]

I think Mr. Carlson did a great job explaining everything. If you aren't a math person he does an excellent job breaking down formulas without being condescending.

[Peter · Rating 1 out of 5]

Dated.