The 7 Golden Rules of Income Investing

You see, every successful income investor lives by a certain set of rules. And if you follow them, you too can build a million dollar portfolio for less than half of what it costs to go the store these days.

Here are the rules:

1. Ignore the News. Warren Buffett doesn't bother to watch CNBC, and why should you? The financial news, after all, isn't any different than your own 6 o'clock news. Drama may draw viewers, but it's nothing more than a distraction to long-term holders. Smart income investors set their portfolios and forget them, ignoring the shrieks of the financial press.

2. Be content to take a single. Sure, home runs are exciting, but a string of singles is just as effective, and much more profitable. Yes, building true wealth takes time, but it's completely achievable. The right Income Investing plan is the solution.

3. Reinvest your Dividends. When an investor receives income, he or she has two choices. The first is to take the cash and spend it... the second is to immediately take those funds and purchase more stock. The savvy investor chooses the latter. Income reinvestment programs are an automatic way to build wealth, and they're the perfect example of why the income investor is often the smartest one in the bunch.

4. Remember the Rule of 72. Compounding is one of the most powerful forces known to man. That's where the Rule of 72 comes in. The rule says that to find the number of years it takes to you double your money at a given rate, you just divide the interest rate into 72. For example, to figure out how long it'll take you to turn $12,857 into $25,714 at 9%, you simply divide 72 by 9, and get 8 years. Now, what if you actually saved $12,857 a year at 9% interest---for a period of 24 years. Then how much would you have? The answer is roughly $1,076,154. Not bad, eh? Income investors know it's the turtle that wins this race--not the hare.

5. Avoid taxation. Inflation is bad enough, but taxation is even worse. As a result, smart, income investors get to know all the legal ways to avoid the Tax Man... and they execute these strategies, without fail, year in and year out. That leaves more money for the income investor to reinvest, fattening up their portfolios all along the way

6. Protect your Principal. Successful income investors realize that chasing yield and yield alone is much too risky. So, instead, they search for income-producing investments with a long, solid history of earnings and plenty of future upside.

7. Income Investors Don't Procrastinate. Time, after all, is literally money. Smart, income investor's don't hesitate to act on opportunity.

And for those of you who may be dissuaded by the rocky state of today's stock markets--Don't be!

Income investing is the winning ticket in every market--even this one. Here's what a few subscribers have had to say...

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