* Quoting from "Graham Comitti to Andrew Freeman on 20 Nov 94  19:58" *

 -=> Andrew Freeman wrote to Graham Comitti <=- 
 -=> On 11-16-94 about Dividend Re-investment p <=-
 
 AF>* Quoting from "Graham Comitti to Andrew Freeman on 13 Nov 94 
21:51"
 AF>* 
 
 AF> -=> Andrew Freeman wrote to All  <=- 
 AF> -=> On 11-09-94 about Dividend Re-investment pl <=-

...
 GC> There is some logic in what you say, but........only if your following
 GC> a   buy and hold strategy (or one of the many executives that have made
 GC> a  small fortune out of DRP's and similar schemes)
 
The model to wealth creation I advocate for myself is buy a home
(least expensive one can afford, pay off as quickly as one can,
have boarders whilst paying interest, get interest free loan from
parents preferably), then maximise employer funded
superannuation, then notionally live off dividends - normally
only selling shares after retirement.

...
 GC> On some occasions it maybe after the cut off date and before the
 GC> actual  distribution that you sell the last holding thus still leaving
 GC> you with  the odd lot.
 
Discontinue dividend re-investment well before sell shares in
model above - that is, after retire live off actual dividends at
some stage, before sell shares in large lots. Whilst working live
off salary equivalent to dividends, with dividend re-investment.

 GC> There are arguments for and against DRP's and similar schemes, some
 GC> suit  may suit some investors, but not others.

I am in complete accord with you on this.

 GC> BTW I think that one the best schemes currently associated with shares
 GC> is the Coles Myer shareholder discount card.  Anyone/family who spends
 GC> around $100 a week in participating stores could be getting an Income 
 GC> return of around 22.5% in the 2nd year (without gearing) (and around 
 GC> 193% if they borrowed $2000 to buy the 500 ordinary shares necessary
 GC> to  participate) this is tax free/paid return on share price of around 
 GC> $4.20. 

I would be interested to hear more about this.

Regards

Andrew



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