As many readers might recall, Brian and I split our retirement savings between our RRSPs and our Tax Free Savings Account. In my TFSA, I hold exclusively dividend paying stocks which I hope will one day be the basis of my early retirement income. Right now, I have BMO, SLF, RSI and REI.UN in my portfolio.
For a while, I had been holding strong at 81 shares of BMO, which got me a quarterly dividend of $59.94. Back when BMO’s shares were trading in the $50s, that was perfect for a slow DRIP. But, their share price has been steadily increasing and regularly hitting new 52-week highs. I needed to buy more shares in order to DRIP again, but for the last few months, I didn’t quite have the cash on hand because I was buying up other stocks that were cheaper.
Unexpectedly, I had the opportunity recently to finally get my BMO shares into a position to DRIP again. Huzzah!
But like any good personal financial blogger plagued with the foibles of human emotion, I wanted to get the best price possible. Even though the money was in my Questrade account and I could pull the trigger at any time, I wanted to get deal, damn it. So every day, I would watch the prices.
$68 a share? Surely it would go down tomorrow, it’s just Monday excitement.
$69? It HAS to go down. That’s a 52 week high. It can’t stay at the price. Right? … Right?
Well, by the time I finally got over myself and hit the “BUY” button, the price had climbed to $71.95.
So in the end, I still ended up buying a healthy number of BMO shares, but I could have saved a couple bucks if I hadn’t hedged and waited.
Point is – when things have an element of uncertainty, waiting won’t necessarily make it better. When I decided to make a career change, I didn’t wait for the “perfect time”, I just figured out the fundamentals (tuition, program, etc) and then did it. When I left my ex, I didn’t wait until I had a place and gobs of cash, I just did it because he was a jack ass. So when I had enough money to buy BMO, I should have just done it. There was no guarantee that the price would go down and looking at a lot of the recent movement, it was likely that it could go up. Lesson learned!
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