Short Takes: Sponsored Post Crackdown, Dividend Investing, and more

Here are my posts for the past two weeks:

Thinking Differently about Investing

Adventures in Credit Reports

Here are some short takes and some weekend reading:

CBC News reports that Advertising Standards Canada will be cracking down on sponsored posts on blogs. This sounds great to me. I’m tired of getting part way through a blog post and realizing that I’m reading paid-for dreck.

Boomer and Echo explain why Echo made the switch from dividend investing to index investing. The comments are civil, and in a few cases they illustrate some dividend investors’ beliefs that can only be true if dividend stocks earn higher total returns than other stocks. One example is “In an upcoming age of slower growth, I believe it’s important to own birds in hand (dividends) vs. two in the bush (capital gains). If I’m correct, dividend investing will be more beneficial.” Another example is “it’s simply not true to generalize that a dividend stock’s price will be held back by its dividend.”

Canadian Couch Potato begins a series of articles explaining smart beta.

Potato reviews The One-Page Financial Plan and finds he is torn between praising it and damning it. He notes that the book “has been out for a little over a year so this isn’t exactly a fresh review.” This doesn’t concern me. If a book isn’t worth reading after a year or even a decade, it probably wasn’t worth reading when it first came out. Authors crave positive reviews at a book’s launch, but I write my reviews for readers.

Big Cajun Man says textbooks are too expensive and that students are a captive market being exploited.

Million Dollar Journey offers wealth-building tips for a friend (Gary) for taking advantage of free money. The only one I take issue with is the cash-back credit cards. If Gary has built a life using cash and debit cards, perhaps the reason is that it helps him avoid overspending as happens with so many of us when we use credit cards. The cash back is a small consideration compared to spending more or paying interest. Don’t spend any time thinking about cash back until you are certain you don’t spend more when using credit cards. One test of this is to imagine buying a $200 item with a credit card and then fan out ten $20 bills and imagine handing them over.