LIR Income Web

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Your Guide to

a Stress-Free

Retirement

Income You

Can Count On

[Its] not necessary for ones investments to generate fantastic fortunes.

Buying groceries, paying the gas bill, taking a vacation now and again these

are the bread-and-butter activities of Main Street, both before retirement and

after. The goal of saving and investing, then, is to replace the paychecks earned

by the sweat of your brow with paychecks from your investment portfolio.

Income steady, reliable, predictable, and rising income is the objective.

Josh Peters, CFA, The Ultimate Dividend Playbook
http://www.lifetimeincomereport.com/


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Income You Can Count On

Welcome to the Lifetime Income Report.

Many people worry about inflation. We see it every day. Gas prices continue to rise. So do the prices of milk, breadand just about every other staple we depend on. So how do you truly combat it, short of getting selected as Bernankes

successor? Well, thats why were hereIn these pages, youll find the easiest way to collect true inflation-beating income without working a single minute.

Your only job will be to cash your checks.

To truly take advantage of this income strategy youll have to think about the stock market a little differently. Youshouldnt be focused on how well your stocks are doing on any particular day. Instead, you should be keeping track ofhow much they are paying you in dividends.

As opposed to capital gains (the difference between buy and sell prices), income stocks are about dividends and makingsure shareholders get their fair cut of profits. Instead of waiting for potential gains, youll effectually demand them if youinvest in the recommendations youll soon read about here.

Think of it this way If someone asked you for some money to start a business, wouldnt you want a cut of anyprofits that business made? Why would it be different with a listed company? Its real money that is rightfully yours.

And instead of settling for the same amount every time, you should also demand larger and larger payments, becausethe company is growing. Thats what we find for you.

We apply a buy-and-hold strategy on all our picks, and hopefully, they pay for themselves over time. Thats where thereal strategy comes in to play. We wont always recommend Wall Streets highest dividend yields, because we dont care ifthey pay great now. Chances are that just means a cut in dividends later. We want medium-sized yields that are growing.Those are the free stocks we are looking for.

You see, theyll eventually grow their dividends until you receive more money than you put down. Thus free.

Take this example

Turn $5,000 Into $169,934 in Just 5 YearsBack in 2003, fertilizer producer Terra Nitrogen Co. paid a small dividend of about 45% of its share price. Nothing

to write home about. But it was picking up steam.

Just $5,000 would have bought you 1,136 shares. But starting the next year, the company took off. The demand forits products grew sky-high, and so did the companys dividend plan. Those 1,136 shares would have been paid offthrough the companys dividends in just 21/2 years.

So you would have had free shares of a growing company that pays a tremendous dividend. But heres where the storygets good. Over the next 2? years, the company absolutely soared. You would have received dividend checks totaling$33,614 with just a $5,000 initial investment a few years before. And its still paying dividends to this day.

On top of this, the companys share price skyrocketed. Your average buy price in 2003 wouldve been just $4.40 pershare. As of today, shares of Terra Nitrogen are trading for $120. Thats a 2,600% capital gain, which is a complete

bonus. After just $5,000 down five years ago, youd be sitting on $169,934 right now.Obviously, thats not the typical case, but those are exactly the types of situations we look for.

After they become free, any gain or income you make off of the stock is a bonus. You may be able to hold some ofthese picks through retirement, while collecting steady paychecks the whole time, with no risk. Thats a lot better thanbetting on stocks to rise in the short term and collecting a one-time profit.

Our Mission: Fill Your Bank Account With Growing DividendsWe are focused on bringing you steadily growing dividend check opportunities. To do so, well be looking for medium

dividend-yielding stocks. We also want to make sure that the companies have long histories of growing their dividends.

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We look for unique ways for you to invest your money in a smart and diligent way. We look at everything from specialdividends to dividend reinvestment plans (DRIPs) and direct stock purchase plans (DSPPs; see DRPs report).

But most importantly, all of our picks have to meet one very important criterion they must have a growing dividend.If we dont think a company will continue to increase its payments, we wont recommend it. Its that simple.

We keep three portfolios in Lifetime Income Report. First, in the Legacy Portfolio, youll see only top-notch long-term

stocks you want to own as early and as much of as possible. It features steady dividends with no signs of stopping inyour lifetime.

Next is the Current Income Portfolio. Itll include higher dividend-yielding stocks that already pay out large amountsto their shareholders. The companies in this portfolio will give you quicker gains and larger dividends than theRetirement Portfolio.

Finally, well also keep a Special Situations Portfolio, because you never know when something will come along thatstoo good to pass up. It is reserved for companies that pay special dividends, dividends tied to earnings (which means afluctuating dividend amount) and companies that pay stock dividends (which means they pay shareholders with moreshares similar to stock splits).

Heres what you can expect from your subscription:

How Lifetime Income Report WorksEvery month, youll receive a brand-new eight-page issue containing any new recommendations and updates of any

changes or news within your open portfolios. These issues will be sent to you by both e-mail and regular mail.

All issues include a complete listing of open and recently closed positions, for you to conveniently browse where westand on all of our past recommendations.

Youll also receive weekly e-mail alerts. We use this feature to send updates on current positions, market analysis andeven flash buy and sell alerts in case something is just too important to wait for the issue.

See the following page for an example of a typical alert.

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Dividend Basics You Need to KnowIncome investing can be simple. But without the right vocabulary, it can be extremely confusing. Here are some basic terms

and ideas youll see over and over again in these pages:

Cash Dividend: a monetary distribution sent from the companys coffers to shareholders

Stock Dividend: extra shares added to shareholders current holdings

Payment Date: the date shareholders receive their distribution or extra stock Record Date: the date the paying company uses to determine each shareholder on record

Ex-Dividend Date*: the first day of trading after the dividend is priced into the stock, usually two to three days before therecord date. On this day, any sellers would still receive the distributionnot the buyer.

Announcement Date: the date when the payment is announced to shareholders and the public

Current Dividend Yield (or Current Yield): the estimated annual payment divided by the current market value of the stock

Trailing Yield: the previous 12-months worth of distributions divided by the current market value of the stock

Cost Yield: the annual distribution divided by the shareholders investment cost

Special Dividend: a payment, comprised of cash and/or stock, that is not part of any regular distribution program

Entry Price: average amount paid for each share purchased

Stock Split: a reassigning of the number of shares each shareholder owns, which is intended to affect the per share price similar to a stock dividend (i.e. A 2-to-1 split gives each investor two shares for each share they currently own.)

*To lock in your dividend payment, be sure to get into your position before the ex-dividend date. This is the most critical date for dividend investors.


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This is just an example. Sometimes, alerts are shorter;

other times, they are much longer. It all depends onwhat were facing out there in the market. But you can

be sure youll get the full report no matter what Wall

Street is doing.

On top of issues and alerts, youll also have

Members Only access to the Lifetime Income Report

Web site. You can always find the full report section,as well as previous issues and alerts. It also features

an up-to-the-minute portfolio to track all of your

open positions.

Trading Philosophy for IncomeInvestors

Now that we have that little housekeeping out of theway, I want to take a quick look at our trading philosophy.You already know where we stand on dividend growth,

yields and values. But thats just how we find companiesto buy. We also have to have an insurance policy forstocks already in our portfolio.

No one knows for sure where the market is going togo, let alone what an individual stock is going to do.Thats why we apply a strict 25% stop loss to all of ourpicks. That simply means that if we get into a stockfor $10 per share and it falls to $7.50, our stop loss istriggered and we should sell that company. There is oneexception to this rule Ill get to in a minute.

We also apply strict trailing stops on companies that have gone up. A trailing stop just ensures you against losing

your profits. For instance, if a company of ours goes up big and then falls back down, we should sell before it collapsestoo far. For each stock, the amount we look for is different. On average, a 15% trailing stop should protect your profits.

The one exception to the stop loss and trailing stop rule is DRPs. If you are enrolled in a DRP, you wont want to tradethis actively. When you make a decision to invest in a DRP, you are making a commitment to stay.

One way to deal with market moves is by cost averaging, or buying on the dips. After you make the commitment tostay, you can take advantage of fluctuating share prices, especially when they are down, by buying more shares. That willbring down your entry price, which will give you an even greater profit when you are ready to sell.

Any companies that offer DRPs we recommend well continue to follow even if they trigger a stop loss or trailingstop unless something monumental changes. So dont worry about what to do. Well keep you updated on anytrading instructions when the time comes.

Beating the Tax ManThe following is for investors within the United States. International investors should consult their tax specialist

Understanding how these investments will be taxed is, obviously, very important. Dividends have always been taxedas regular income, as if you had a job at the company paying the dividend. But with recent legislation, you will be taxedconsiderably less.

Recent laws like the Jobs and Growth Tax Relief Reconciliation Act of 2003 and the Tax Increase Prevention andReconciliation Act of 2005 have lowered taxes on dividends through the next few years. Ill focus on the sections referringto dividend taxes from 20082010.

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Baltimore, MDNovember 3, 2008

Blowing Away the AnalystsOn Friday, Clorox Co. (CLX: NYSE) reported record earnings.

Sales rose 8%, and earnings per share rose to 91 cents a full 7 cents

higher than analysts expected.

The company also sent out its third-quarter dividends 46 cents

per share. Thats 58% more than they were just two years ago. This kind

of growth doesnt look like its going to stop anytime soon.

This bit of good news couldnt have come to us at a better time.

When the markets are biting, you need to bite back. If you havent done

so already, I recommend

Recommendation: Buy shares of Clorox Co. (CLX: NYSE) up to

$61.33. Clorox also offers a DRP. To enroll, call 1-888-259-6973.

Sincerely,

Jim Nelson

Editor, Lifetime Income Report


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Most investors under these laws are taxed at a maximum of 15%. Lower income investors are not taxed, at leastuntil 2010.

What that means to you is this: If you receive a $1 dividend, you have to pay 15 cents of it to the federal government.

Dont worry; well keep you informed of any changes to the tax code in relation to dividends

Of course, you wont have to worry about any of this if you invest in dividend-paying stocks using a tax-exemptretirement account such as an IRA.

The two youll typically run across are traditional IRAs and Roth IRAs. Heres a quick rundown on how they work:

Traditional IRAs allow investors to put off paying taxes until retirement. Instead of paying out taxes on all dividendsyou receive, you will have to pay taxes only on money you withdraw at retirement. Thats taxed as income.

While that sounds just as bad as being taxed all along, there is an enormous benefit. Instead of handing over thatmoney to the government every year, you can sit on it and reinvest it using the IRA thus, growing it even more. Thenyoull be taxed only at the end.

Roth IRAs are the better choice, if you have one. Individuals using Roth IRAs usually dont have to pay taxes at all.These are more comprehensive tax-free accounts. Unfortunately, they are usually much stricter, and certain dividendstocks arent allowed in Roth IRAs.

Be sure to consult the manager of your IRA with any tax questions about your Lifetime Income Report recommendations.

BrokersWhile it is, obviously, more beneficial for you to use tax-free retirement accounts to do your income investing, here is

a short list of discount brokers you may want to look into:

E*TRADE one of the cheapest online trading services, for as little as $6.999.99 per trade. E*TRADE is also offering

100 commission-free stock and options trades for anyone who signs up.

Contact E*TRADE at 1-800-387-2331 orwww.etrade.com

Zecco a fairly new, but groundbreaking service, which offers free stock trades. With an account, you get 10 free

stock trades per month with at least $2,500 net equity. Its $4.50 per trade otherwise.

Contact Zecco at 1-877-700-7862 orwww.zecco.com

TD Ameritrade standard online discount broker with a flat commission of $9.99 per trade, no matter how many

shares. TD Ameritrade also offers retirement planning.

Contact TD Ameritrade at 800-454-9272 or www.tdameritrade.com

Scottrade popular trading service with stock trades starting at just $7. A minimum of $500 is required for a regular

account and $2,000 for a margin account (which you wont need for Lifetime Income Report recommendations).

Contact Scottrade at 1-800-619-7283 orwww.scottrade.com

Charles Schwab the oldest discount broker, but not the cheapest. For the first 1,000 shares of any trade, Schwab

charges $12.95. After that, you get charged $0.015 per additional share.

Contact Charles Schwab at 1-866-232-9890 or www.schwab.com

These are just some examples of brokers to choose from. As a disclaimer, Agora Financial does not have a relationshipwith these or any other brokers. You should do your own research to find which one best fits you. Be sure to study thefees and commissions each charges.

After you find your broker or have talked to your retirement planner, you are set to start loading up on the dividends.After you buy your first income stock, be sure to track it through Lifetime Income Report alerts and issues.

Again, welcome on board.
http://www.etrade.com/http://www.etrade.com/http://www.zecco.com/http://www.zecco.com/http://www.tdameritrade.com/http://www.scottrade.com/http://www.scottrade.com/http://www.schwab.com/http://www.etrade.com/http://www.zecco.com/http://www.tdameritrade.com/http://www.scottrade.com/http://www.schwab.com/


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2010 by Agora Financial, LLC. 808 St. Paul Street, Baltimore, MD 21202. All rights reserved. No part of this report may be reproduced bany means or for any reason without he consent of the publisher. The information contained herein is obtained from sources believed to

reliable; however, its accuracy cannot be guaranteed.

WWW.AGORAFINANCIAL.COM
http://www.agorafinancial.com/http://www.agorafinancial.com/http://www.agorafinancial.com/

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