@cbPM51 wrote:
Yes, is this for you?
Buy 100 Telus shares in your TFSA at 24$ and let the quarterly dividend pay your mobile bill.
24$ x 100=2400
100 x .375c/quarter =
100x.375x3=112$
112$/3 = 37.5$ for your
Cell plan
Withdraw dividend and pay your bills.
(With the end of legacy rewards, If you can't beat em, join em.
Unfortunately, that isn't how a quarterly dividend works and the dividend payment has been overstated by approximately 3x. When a stock pays a quarterly dividend, the declared dividend is the total amount paid per payout per share. That $0.375 per share (the number is actually $0.3761) shouldn't be multipled by 3. For 100 shares, only $37.61 would be paid out for the next dividend payment. The $37.61 divided by 3 would only come out to $12.54. Also, dividends are never guaranteed to be maintained or increased.
In any event, if we assume that the dividend from about 300 shares are required to pay for a $34 plan, remember that the plan still really isn't free. I don't deny that dividends can be used to pay for the plan, but please realize that this isn't free money. This is actually still your own money that you're using to pay for the plan. Dividends that aren't re-invested and that are withdrawn decreases the value of your investment. In addition, nothing has actually been made on the investment until such time that the stocks have either been sold with a capital gain or the received dividends have surpassed the original cost.
