Lifecycle Investing – Dividend investing with leverage (SPOILER: the numbers might surprise you)


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Dividend investing with leverage is a very controversial topic. In this video, I dig into the numbers around investing in the stock market with leveraging a home equity loan.

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DISCLAIMER: I’m not a financial advisor and the content discussed today is merely my opinion and intended only for your entertainment. The content expressed in this video should not be considered as professional financial advice. #Dividend #Growth #Investing

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  1. Dividend Growth Investing
    July 31, 2021 at 10:14 am

    Would you ever invest in the stock market using leverage?
    Disclaimer: I do not currently invest on leverage and you should understand the risks associated with this type of strategy before investing on leverage.
    Try M1 Finance:

  2. J R
    July 31, 2021 at 10:14 am

    If it’s a rental property you will also deduct the interest paid. Your home will also increase in value (likely) and your mortgage will amortize. This is the best use of equity – much better than the Dave Ramsey approach.

  3. Jimbo The Coastie
    July 31, 2021 at 10:14 am

    Be careful. This appears to be a Reg T violation. Borrowing money to invest is subject to rules. Know the rules.

  4. Wade
    July 31, 2021 at 10:14 am

    This is actually basically what I'm doing right now I went on YouTube to see if anybody else was doing this. I'm using a line of credit for the bank not a HELOC I started March 2021 I started with $1,000 I went to $3,000 then to borrowing $5,000 the next time I take out money it will be $8,000 I'm going to try to get $20,000 a year into safe dividends stocks and reinvest it all. I pay off the loan with my payroll money for my job this is my way of the FIRE movement.

  5. RobGFiness
    July 31, 2021 at 10:14 am

    You said “we could have the greatest economic recovery ever” well we did… watching this a year later tho. I still wonder how many people became millionaires from leverage in the market.

  6. Ethan Shy
    July 31, 2021 at 10:14 am

    Kind of an old video but you can use leverage in M1 at 2 percent which is quite a bit lower than your rate here. I feel this would be a better option long term because worst comes worst you’re not risking your house. I might do this after watching your video. I love your video! Keep it up.

  7. Mike P
    July 31, 2021 at 10:14 am

    I believe a leveraged ratio of 10%-15% of your net worth into dividend investing (or real estate, or both), is reasonable risk. At the outset, your net worth does not change and there is significant probability of improvement.

  8. Nice pants
    July 31, 2021 at 10:14 am

    Not a bad method to invest with leverage, but I think there are better ways. I'm utilizing the Hedgefundie UPRO/TMF Strategy. Only time will tell how it all turns out.

  9. David Zalayet
    July 31, 2021 at 10:14 am

    Of course there’s risk but I think it’s a good risk

  10. Jonathan Delossantos
    July 31, 2021 at 10:14 am

    Interesting! I would do this with an amount Im willing to lose Incase things go sideways

  11. Jonathan Van Acker
    July 31, 2021 at 10:14 am

    I'm buying dubble the amount of stocks these days, half ST with margin and I keep half for LT investing. Lending seems like a solid idea to do, but I want to be debtfree in the long run. I don't really see margin plays as debt (as long as it is used wisely) ie hitting those swings, letting the market do it's thing and using your brain. Great video, something to think about really. Great work.

  12. sensei887
    July 31, 2021 at 10:14 am

    I believe your numbers are wrong. You can't have a Dividend Yield of 6,5% AND share price appreciation of 8%. That's too much. Also when using companies with a high dividend yield, that comes mostly at expense of the dividend growth. A company with 6,5% dividend yield AND a dividend growth of 8% is somewhat rare. Usually it's one or the other. 1% yield with 10% growth p.a. , or 5% yield with 4% growth. Your example is not realistic.

  13. Archimedes743
    July 31, 2021 at 10:14 am

    As long as the return is equal or greater than the borrowed interest rate, you cant go wrong.

  14. LifeCoach44
    July 31, 2021 at 10:14 am

    6.5 % yield + 8% growth seems way high

  15. INCO
    July 31, 2021 at 10:14 am

    Seem logic you borrow at 3.5 % Buy something that give you 6.5% and growing, at lowest share price cause of the crash, backup by 50 big companys, it a Win if you ask me

  16. Theta Gang Hustle
    July 31, 2021 at 10:14 am

    i got a 2.7 fixed thirty year cash out refinance. Its a jumbo size loan of half a million dollars. I can get long term RE equity appreciation and live for free. I'm thinking of selling cash secured puts and buying in on 7% dips.

  17. 1266tsl
    July 31, 2021 at 10:14 am

    I using margin facility from IB and the interest rate much lower than home equity. Only 1.5% if u borrow EUR. then invest in REIT like ARR which give above 8% dividend yield, easily earn money using broker's money. Of coz ARR is just a example, you can consider KO which DY still beat interest rate paid to IB. What do you think ?

  18. finanzas en acción
    July 31, 2021 at 10:14 am

    great video i subcribe to your channel. There is something that I dont get if i have 1000 usd avaliable in margin open a posicion let say in tesla for 1000usd. Wil i pay interest in that borrowed money? also when most brokerage sellout your position ? it need to go down 30-% ? thanks a lot

  19. Wop wop
    July 31, 2021 at 10:14 am

    This obsession with dividends is just dumb. If you only buy dividend paying stocks, you're cutting your diversification short. You'd miss out on great stocks like Tesla, for example. A total market ETF would've captured Tesla's massive growth. And it will capture the next Tesla's massive growth.

  20. andrew a
    July 31, 2021 at 10:14 am

    8% growth rate with 6.5% dividend yield is a lot to ask for

  21. fred hernandez
    July 31, 2021 at 10:14 am

    You could just buy the companies yourself no expense ratio

  22. Tien Doan
    July 31, 2021 at 10:14 am

    Backtesting 50/50 UPRO/TMF gave me a boner

  23. Jo John
    July 31, 2021 at 10:14 am

    Completely nuts!!!!! At least get a mortage on a house you don't live, market is doing crazy things and people do crazy things , not always is going to work out as you thought and dividends is just a candy of the investment , the money is in capital gains. Just use CFD is you can .

  24. Gary Dahlem
    July 31, 2021 at 10:14 am

    What about the income tax on the dividend? That's going to take away at least 10-15% for the average Joe.

  25. Adam ES
    July 31, 2021 at 10:14 am

    Amazing! I get free leverage use so i have been looking for a video like this!

  26. Duramajin
    July 31, 2021 at 10:14 am

    I leveraged into the down market, my only regret was not having access to more equity before the crash.

  27. juan thecave
    July 31, 2021 at 10:14 am

    you know what they say, 5% a day, keeps the dayjob away!

  28. Bruno Manco
    July 31, 2021 at 10:14 am

    My "dream" would be that the bank would allow me a 30 year bond issue so that i could buy a bunch of utilities, telecoms and infrastrucutres, high dividend payers, repaying the debt and living of the rest. I noticed that the richest families in my country ended up doing this to buy our known electric, utilities, oil, infrastructures and telecoms. The difierence is that theyre shares have control of the company, and they could use theyre influence to increase the dividends or even extra dividends

  29. Tailong
    July 31, 2021 at 10:14 am

    Unless you have a crystal ball, leveraging is always a huge risk, but huge risk is what has made many people millionaires. You just got to hope that you'll be one of the ones that made it.

  30. Dallas Harvey
    July 31, 2021 at 10:14 am

    rewatched this today and what you said @18:10 hit me like a brick. the most expensive car payment I've ever had was $172.