You DO NOT NEED Millions to Get Wealthy With Dividends

0:00 not about what you can have next week or next year. It's about what you're going to do with this money in 20, 30 years from now. I see my income growing every single year and sometimes every single month. Now, a year later, I'm making $9,000 a month. It is it is addictive. That's for sure. Like once you start getting these distributions, it's addictive. Welcome back to another goround worth of Masters of the Market. This week, I couldn't be more excited to have Paul Santori on with me from Blossom, who's generating just a little over $9,000 in monthly income there. So, if you're looking to rev it up, Paul has a strategy for you. Paul, I want to welcome you to Masters of the Market and just toss you the first question, which is what exactly is your story and how did you get to where you are today?

0:46 First of all, like I was saying off camera, I really appreciate you inviting me to come out and be on your channel. I'm from Canada, as you know, 51 years old, going to be 52 in August. Typical Canadian, you know, started out with my RRSPs, which is a registered account in Canada back when I was 18, 19 years old. And at that time, everybody was buying mutual funds, right? It was the easiest thing to get into, the most affordable, and uh that's kind of what all companies were pushing and they still do. So that's that's where I started. Uh fast forward to 2020, I sat down with my financial planner. I had a whopping $131,000 in my uh combined portfolios and uh you know we made a couple of decisions. I moved a little money into a high interest savings account cuz I thought I need I need an emergency fund. So we did

1:31 that. Talked about some of my other positions in my portfolio. it was just mutual funds and uh you know we went we went about our ways right as you know a month later co hit and the market crashed completely tanked and I thought I think this is the best time for me to get into the stock market you know no more mutual funds no more financial planners I'm going to take the ball and I'm going to do it all on my own right so I called up my bank put in my request to open my own brokerage account took a few weeks but by uh April 6th I was buying my first stocks And like everybody else, you know, I turned to YouTube. I found some guys like I don't know if you've heard of Dan Kent from Stock Trades. Got a great great financial uh channel and a business in Canada. There's a young guy named Robin that I follow. And of course, everybody

2:17 knows the goat Adrian from Passive Income Investing, right? I found him in in 2020. He had about 300 subscribers and I think now he's about 110,000. followed these guys, bought some stocks, and by June of 2020, I made $86 in dividends, right? So, I I was roaring. I was going uh a year later, I was up to uh 981 in dividends. And I was basically buying a lot of the typical dividend stocks that people buy. I found out about REITs. So, I started buying some REITs and learned about Split Corps. I don't know if they have those in in the states, but in Canada, split corpse, they pay a a a decent, you know, 10 to 20% yield. As 2022 hit, you know, I kind of kind kind of got caught in that trap of buying some small small cap stocks.

3:05 Lost my shirt on all of those. So, that that obviously was not working. Um, they all seemed to go to go to zero. You know, I played the meme stop stock game for a little while, you know, got into some of those, made some money, lost some money, you know, so that wasn't that wasn't working. But by about 2023, I really started getting into the covered call ETFs. And in the in the last two, three years, the providers in Canada and the States have just been pumping them out, as you know, right? They're just, you know, every week there seems to be a new one. I I just I basically started picking up ones that that were being recommended online by Adriano or other other YouTubers, collecting the dividends, you know, and and just each month reinvesting the dividends and and growing it, you know. So, I I I sat down and I thought, "Okay,

3:51 I'm talking to Ari. I got to have some numbers for him." And uh from from 2021 to 2022, my dividends increased by 75%. A year later, went up by 45%. By 2024, another 93% I was making $5,000 a month. So, I got to the point where I surpassed my take-home pay, right? So, if I lost my job, I'd probably be okay. The money was coming in. Now, a year later, uh, June of this month, as you said, I'm making $9,000 a month. So, there are a lot of people who talk badly about this sort of strategy, income investing or covered call ETFs, but I see my income growing every single year and sometimes every single month. So, to me, it seems like it's a strategy that's going to work. You know, there's

4:36 so many stories like yours, Adrianos's, and everybody who's doing this, I want to say new trendy investment strategy of passive income investing. Everybody seems to have started with dividend stocks, the traditional dividend stocks. I just want to ask you off the bat, is that like a dying strategy, you think, the traditional route of dividend investing, and should we all be veering into more of the covered call income investing strategy? Uh, I don't think it's necessarily a dying strategy. I think a lot of it has to do with what works for you, you know, and and also your age. If you're younger and you have more time for a a dividend growth strategy where, you know, a stock might have a 2% yield, but it grows that yield by 10 15% a year, then, you know, 20 30

5:24 years down the road, it's going to make sense. But, you know, I I don't want to wait 20 more years to retire. So for me, I kind of I'll give you an example. I started with Embridge stock which paid say a 5% dividend yield. Then I found out about the split corp. Anyways, I bought that one and it uh it paid say 10 or 12%. Okay, which was fantastic compared to the 5%. Then who was it? Global X came out with a fund that pays 18%. But it holds oil stocks as well. So it just went from one to the next to the next and each time your your monthly income just grows. That's I mean that's the way I see it. I would I wouldn't say though that the dividend growth strategy is is dying. It's just it's a different way of doing it. I say it's almost a time and a place for

6:09 that type of strategy. And you already mentioned it. If you're younger and you're in the position to invest in more dividend growth oriented opportunities, that's what you should be doing. However, I mean the fad today really is this new passive income investing strategy. So, what would you say to the masses of younger investors who are leaning into this strategy? Would you tell them, "Hey, you you got to stay in your lane and go more growth right now, or would you say it's quite all right to go down this path and start generating that passive income for yourself now, even though you might not need it?" A real life example would be uh my kids, my son specifically. He's like me. He loves this stuff. My daughter, not so much. And uh what I did with him was I started him off with some of these covered call ETFs so he could see the

6:57 monthly income. Once once kids see that they're making money, they kind of get addicted to it. And then once he got a bit of a portfolio growing and making a monthly income, put them into a growth fund. And now the goal is to make that, you know, probably 50 60% of his portfolio. I think for a younger person, you can be a hybrid investor as well. So let me ask you this. With that being said, what's the best way then to go about finding your investor profile? It's something that I speak about quite often on my channel. Really understanding where you stand as a investor, whether that's your risk tolerance, your age, your goals. How would you help an individual discover their investor profile? What are some of the keys there to do so? That's a good question, Arian. You you mentioned some of them. You know, when people send me messages on Blossom and

7:43 they ask me, "What should I buy?" Well, it's not just as simple as what should you buy, right? Because it's, you know, how old are you? How much money do you have? You know, what's your risk tolerance? You know, if you put your money into one of these covered call ETFs and it drops 20% tomorrow, are you going to be upset about it? And then depending on how they answer those questions, I try to give them some suggestions on and for some people, the suggestion is just buy VFD, you know, or buy VU. It's not for everybody. Like the the covered call ETF strategy is definitely not for everybody. So, with that being said, who's who do you think these covered call strategies or these ETFs rather are for? Like the ideal investor who should be looking into them? Somebody, I guess, who's more hyperfocused on growing their monthly income? And I guess leaning towards somebody who's a little bit older. I mean, you don't need the income when

8:29 you're younger, but as you get to be a little bit older, you want to start thinking about retiring, then then that would be, I guess, the person that these would work best for. Do you need to watch these ETFs like pretty carefully in your experience or have has it been pretty handsoff for you? I think these ETFs you can buy them and just kind of put them on drip and let them let them do their thing or you know maybe if you want to check your portfolio once a week or once a month you can do that because I'm you know this is a real big hobby for me. I, you know, I check my portfolio daily, but I have friends that have gotten into this who, you know, maybe once a month they'll check and see where things are at and they'll take their dividends and reinvest into something that's on sale at the time. So, it really depends, I think, on your personality. Some people are very active with their investments and other people, you know, they don't

9:16 want to be, but you don't have to be. I mean, here's the question that I have, especially we can even bring up Adriano. You know, he was on the channel actually almost a year ago now. from when he was on to now speaking to you and you guys are using the same strategy. Like I said, there's this big push to generate the passive income and almost no longer the necessity or the need or the interest rather for a lot of these younger investors to tap into growth whether it's a fund or an individual stock. But there's got to be some risks involved with some of these funds. And I'm curious to know in order to be that handsoff almost ultra safe or as safe as you can be investor, what are some of the red flags that we should be looking for when we're looking into these types of funds? If you want to keep your

10:01 portfolio, say to a minimum, you know, maybe low to medium risk, you want to stay away from, you know, like your yield max type uh ETFs where they're using synthetic shares and they're writing on 100% of the portfolio and they can swing, you know, 50 60% in a couple of days, right? you want to go for the the uh ETFs that are covering an index like the S&P 500 pay a 10 or 11% dividend yield, but they're pretty level. You know, they'll go up and down with the S&P, but they're not going to, you know, they're not going to drop 40 50% in the course of a week, but they're also not going to pay you that, you know, crazy 100% yield. Are these volatile indexes or ETFs

10:47 where the money is really made or can you actually make you know where you're invested now is that where you're making the large sums just investing into these indexes? No. Uh in Canada, we have a company called Harvest that uh in the last 6 months, maybe 8 months, they came out with sort of a Canadian version of the YieldMax funds where they'll take like a Coinbase or Strategy and they will do a a single stock ETF, but they actually hold the underlying stock and they'll only write calls on say 33% of it. So the the balance you have, you know, the shares are there just to grow. And what they do is they kind of have a more fixed distri distribution and they keep it lower. You know, they're not trying to give you the 100, 130% yields. You

11:35 know, maybe it's 15, 20, 25, 30, but they seem to be a lot more consistent and uh it's been a game changer to be honest with you. Interesting to me. You know, I'm even just now thinking about Adriano's conversation when I had it with him and you know where you're at now generating $9,000 in income monthly, which is surpassing your career, your full-time job. And it it just creates the question, it's like, why not everybody like why isn't everybody doing this? Is there where are people perhaps going wrong than with some of these funds? And why shouldn't everybody be investing like this? I mean, I don't think necessarily people are going wrong or you know, why isn't everybody doing I mean, why didn't I invest in uh you know, VU 15 years ago? You know, I could have made a pile of money, but I didn't

12:21 know about it, right? I did know that that's what people were doing, investing in the S&P 500, right? Cuz I was uneducated about it. So, I think that's it. Like, a lot of people maybe they just don't know. It's it's it's hard to say, Ari, I don't really have the answers for that to be honest with you. Uh, you know, a lot of people say, "Why doesn't Warren Buffett do it?" Warren Buffett's a billionaire, you know what I mean? He he doesn't just buy stocks. He owns businesses. You know, he's at a whole other level than we are. So, you know, I can't go out and buy all of Dairy Queen. He owns it. I don't think really there's one right answer for investing. It a lot of it depends on you personally as well, right? Absolutely. I you know I'm thinking 10 years ago I mean 15 years ago these vehicles were not even around and so they are very new still to the retail investor just getting our hands on them

13:07 being able to make money like I said I interviewed Adriano about a year ago and when you started following him he was around 300 subscribers now he's over 100,000 and it just goes to show I mean look with all the education with all the information coming out and the the kind of trend is your friend train leaving here everybody wants wants a piece and and to jump on what where do you think in terms of the market? Like where are we heading with these ETFs? Is this the future? I mean, I'm not sure what's coming out next. You know, a lot of these providers are trying to do things to make the investors happy, which I don't think used to happen. You know, now because of social media, because of YouTube, you know, fund managers are being interviewed by guys like you and they're they're realizing what do people like me want, you know? So, I've watched videos

13:54 now. Now, I think I think his name is Spencer where he talks about how you can get paid every day of the week, right? If you buy certain funds, you can get a a dividend on Monday, Tuesday, you know, right through to Friday. Do you really need that five days a week? Probably not, you know, but uh that seems to be where it's going is uh you know, these companies are trying to meet the needs of the people. Uh some of it's a little bit silly, I guess, in a way, but uh it is it is addictive, that's for sure. Like once you start getting these distributions, it's addictive. I was going to say I used to call it when it came to dividends, dividend dopamine. And it was just like, okay, how do I get that yield up? How do I get that next dividend? And even when I first started, you know, as an investor, you know, initially I was in a index fund and that

14:40 was like, you know, I just put I think $20,000 into the account, let it sit for a while and then I really started to get into the game of investing through dividends. And again, it was like that same effect. It was like, oh, I loved watching the dividends hit my account. I eventually had to ask myself some deeper questions. What am I doing as an investor? What are my goals? How am I going to get there? And where am I, you know, based on my profile? I started to veer into dividend growth investing, heavy emphasis on the growth. But I'm sitting here thinking now, you know, to compete with the kind of dopamine hits of the distributions at 10 plus% 20%, it's it's almost impossible. How would you recommend investors, especially the young investors out there, put aside their emotions and stay their course to

15:27 be level-headed? For me, you know, the distributions are are great, but I think that like the important thing is you have to see it growing, right? Like, so if you're growth investor and your goal is to have $3 million and live off of 4%, you know what I mean? So, you have to see your portfolio growing not not week to week or month to month, but you know, decades. For me, I'm not really trying to get to that million, $2 million portfolio, but I have to see my monthly growing, right? There has to be like a goal. You have to have goals, you know what I mean? And you have to work towards them. And that's like that's what I'm trying to teach my kids is you're 20 years old now. Would you like to be able to retire at 40 or 45? So, if you would, you have to work hard and then you have to take a portion of your income and put it in your account. And my son says, "Yeah, great. Next year,

16:13 I'll buy a car." No, you're not going to buy a car, right? That's not what you're investing the money for. You're investing the money for your future. You know what I mean? It's not about what you can have next week or next year. It's about what you're going to do with this money in 20, 30 years from now when you decided, I don't want to work anymore. I want to travel the world and now you have that opportunity. I I mean, for for young people, I guess it's harder to see that far down the road. But that's the goal, right? Definitely. It's harder to look down the road. I have these conversations all the time. Hey, if you can look 10 years out, 15 years out, 20 years out, you're going to be in a great position. But so few people are actually able to do that. And I'm curious to get your perspective on that. Why? I guess people just live for the moment. You know, they they want to have flashy things. They want to have, you know, nice clothes and a nice car. And, you

16:59 know, they're more concerned about what people think of them today as opposed to, you know, saving up for their future and, you know, and having security of of being able to take care of yourself without relying on a job. You know, I guess that's it's important to some people, especially younger people. I guess it's it's more difficult with social media nowadays, you know, to try and, you know, live up to other people's standards, which it's ridiculous, right? It doesn't matter what you wear, what you drive, you know, it's if you have the money in the bank account that you can take care of yourself, that's what that's what matters. This is kind of a tie-in question, but it's when people watch Adriano or people even on Blossom. I mean, you got quite a following on Blossom, which by the way, if you're not already following Paul on Blossom, definitely someone to to

17:45 follow, learn, really learn his strategy, how he's building these income streams. But, okay, let's say, you know, people are following you and again that those emotions come in and it's that dividend or distribution dopamine hitting them, but they have to remain calm almost and say, you know what, Paul's story is different than my story. Adriano's story is different than my story. It's almost too hard to do nowadays when you're watching somebody else generate all that income. So, can we train patients? Is this something that we can that we can work on that you think is feasible for all of us to work on? Yeah, I think so. And did you interview Perry or did somebody else interview Perry? I Yeah, also interviewed Perry. Yeah. So, I mean, look at Perry. You know, he's making $40,000 a month and

18:32 compared to what I'm making, that's incredible. When uh when I first started watching Adriano and he was making four or $5,000 a month and I was making, you know, a hundred bucks, it was like, well, I'll never get to where he's at. But you keep working at it. You keep working at it. And now I'm past where he was when I first started watching him, you know? So now he's making 20, 30,000 and Perry's making 40. Maybe I'll get there. You know what I mean? So you kind of have to have the patience like you said. And but I think these people are inspirational, right? It's an inspiration to see, okay, somebody else has done it, maybe I can do it as well. When you look at some of these other portfolios, whether it's Perry's or Adrianos's, do you have your own strategy to say, hey, you should only have x amount of funds in there or perhaps you should have x amount in

19:19 growth, you know, x y amount in uh income orientation. I'm curious to get your scope on building out a portfolio. Well, like when I first started watching Adriano, he probably had 80 to 100 positions in his portfolio and uh currently I think he's down to about seven, maybe eight, right? So, you know, it's been a big change in the last 5 years on on how he's done things. And uh myself, I was looking at it and I think in the last few years I've sold over 60 positions that I've bought some, sold some, you know, bought other ones, sold other ones. And I'm actually trying to take a bit of a a play from your book and and reduce the number of positions I have because do I really need 50? Like do I really need 40? I'm finally down to 35 and I'm trying to instead of having

20:06 these little tiny positions that pay you, you know, a couple bucks a month or whatever. I'd rather have larger positions, you know, that are more focused and pay better. The problem is they keep coming out with new ones. You know, there seems to always be something new coming out and you want to try it. So, you know, I sell one and I end up buying three more. But I am trying to get more focused, you know what I mean? And have better quality. And at the same time now, what I'm trying to do is use some of the high yield dividend funds I have to buy things like CHD. You know, go for the ones that are maybe more conservative but will grow over time, kind of like a safety net, a little bit of an emergency fund, right? So, I'm trying to do that as well now. And I'm even starting to set aside some cash. I'm starting to work on uh you know, like what do they call it? the three bucket system where you know you have

20:52 one bucket where you can use that for spending money. When I finally decide to pull the plug and retire, I'll have cash to live off of for the first whatever couple of months and then keep funneling money from my distributions into that bucket. So, I'm starting to work on these things as well now. I'm kind of like expanding my portfolio. Let's say someone out there right now watching us and saying, "Wow, I mean, Paul is generating income and I'm almost at zero or I don't know, a couple hundred dollars in just plain old dividend income." And they want to switch their portfolio to be more aligned with your strategy. How would you recommend that these investors reorient themselves to actually follow suit on a strategy like yours? Uh what I like to suggest to

21:38 people is start small, right? Like if you've never bought cover call ETFs and you and you just have maybe a a growth fund like VU or you have some individual stocks like Johnson and Johnson or whatever, you know, maybe maybe dip your toe in and buy uh a covered call ETF. Start with 10 shares, you know, maybe start with a 100 shares depending on the size of your portfolio and wait a month, you know, wait until the first distribution hits and you kind of see how it works and then buy a little bit more and kind of ease into it. You know, I wouldn't I wouldn't recommend somebody go out and just buy, you know, $100,000 worth of ETFs on the first day because if it doesn't go the way they want it to, then they're going to be upset about it, right? And and they might not fully understand how it works in the beginning. So, it's probably better to

22:24 ease into it slowly and do some research. I tell people like, you know, go on YouTube, watch some videos, learn what these things are about before you just take my word for it and go buy them. You're either going to like it or you're not, right? And and once you kind of learn how it works and you see you see the money coming in, then you can decide, you know, that's what I did. Like I I held on to TD stock right up until I think a month ago or two months ago. And then finally I sold it and I put it all into a Canadian ETF called Bank. So I still own TD Bank, but I just own it in an ETF and I get an 18% dividend. Should we all really just be focusing on ETFs at this point? Because I was even at an ETF conference not too long ago and we're just at a point where ETFs are overtaking the amount of individual stocks. We know for a fact that no

23:12 investor, including Warren Buffett and the other greats out there, can perfectly time the market and pick the winners 100% of the time. But ETFs are kind of your your golden ticket to wealth. So what's the point I mean these days of even trying to pick those winners and find individual stocks if you can do it like if you can pick the right individual stocks you're going to outperform right you're going to outperform ETFs you know I mean if you had jumped into something like Nvidia two years ago when whatever it was at 100 bucks at the time you know and it shot up to eight or $900 in a year or two you're going to make a lot of money but you have to be able to pick those stocks and I don't feel confident in my abilities to do that. So, I don't I

23:58 don't even try. I don't analyze balance sheets and, you know, income statements. I don't do all that stuff. But if you can, then yeah, sure. Why not? You know, if you if you can do it, who's who's uh Daniel Prong? You ever watch Daniel Prong's videos? He's great at picking stocks. You also have to patience. You have to I think you have to have the patience for it because some of those stocks may not, you know, you may not see the results for years at a time. So if you have the patience that you believe in a stock and you can do that then you know I would I would recommend it to people who are capable of doing it. But I think the average person is probably not. I agree with you. I mean there's so many investors I think trying to do just that and you know sometimes we fall flat in our face you know empty pockets at that point in time saying why didn't I just pick something that you know would have

24:44 yielded me this return. Now you mentioned a moment ago when we were talking about you know starting slow which is al again something I agree with. Start slow when you're investing. Build up these positions. See if you're comfortable with them. See if you like them. What do you dislike about them? I'm curious to get your opinion on when it comes to income oriented funds. What would be some of the things that as investors we may not like about those funds? Like I again I'm just trying to think in my head, well I see Adriano making all this money and and again Perry and you and I'm like why why not me? And so I start to throw my money into these income oriented funds. But what would be one or two things that may sway me in the other direction? Uh if you buy funds at certain points in

25:30 time, like where maybe they're kind of at a high, you know, and and so you decide, okay, I really like this fund. It pays well. It's 15 bucks a share. I'll buy a,000 shares. and a week from now something happens in the market and all of a sudden it drops down to, you know, maybe 11 or 12 bucks a share. You might be looking at your portfolio going, "Wow, you know, I'm I'm making 200 bucks a month in dividends, but I've lost $3,000 in equity, you know, and so you might think, well, this sucks. I don't really, you know, I don't I don't like this type of investing." But it's really, when you think about it, it's really no different than if you were to go and buy Visa stock and something happens in the market and the share price drops by 40, 50 bucks a share. At that moment, you're losing money, but only if you sell, right? And it's the

26:15 same thing with the covered call ETFs. You may be down for a little while in terms of your share price, but if you hold it long enough, chances are it will come back up. Or you can do like you do with any other stock and just buy more. You know, just DCA while it's down. Do you find the vast majority of investors who are buying up the covered call ETFs have a little bit more emotions when those stocks or funds rather are swinging low? It depends on the person, right? Because there there are a lot of us who have been sort of in this investing style in this community for years now and it's like a big sale. You know what I mean? It's like the market's red, prices have dropped, it's like I've been sitting on 20 grand and now I'm going to go shopping. And they get excited, right? Like they're really excited about it. But if you haven't been in the market

27:01 doing this type of investing for a while and you see the prices drop, you might think, "Well, great. I've just lost all this money." So, it's kind of all in your mindset. You have to you have to understand the strategy and you have to understand the fact that the market goes up and down all the time almost for no reason whatsoever. Right? It's very emotionally based. So, you almost have to take advantage of other people's emotions, right? other people are selling because Donald Trump said this or a war started somewhere here and the market tanks. That's when that's when income investors are buying. Can you talk to us a bit about erosion? Because the word erosion is thrown around quite a lot when it comes to these funds. And I think this is almost a primary driver of why people stray away from these funds or have a negative

27:47 connotation or association with them. Yeah, it's it's an interesting topic and to be honest with you, I don't fully understand it. You know, they say that these ETFs are only paying you back your own money. Uh that there's NAV erosion, that every time you get a distribution, the share price is going to go down. And then I look at a fund like launched at just under 13 bucks a share and now it's well over $22 a share. Where's the NAV erosion? How come all the distributions they're paying is not eroding the fund? Right? I'm I'm up like 60% or something. I'm debating on whether I should sell it. You know what I mean? Is it too good to be true? But yeah, so these they basically just kind of they seem to go up and down with the underlying stock, right? If the underlying stock is doing well, then then you get share appreciation. If it's not doing well,

28:34 then it goes down. But I haven't really seen any correlation to they're paying me a distribution, so the price goes down. I almost feel like that that comes down to your ability then to pick a fund that has the a good quality underlying position. How would you recommend investors find those positions? I think the best thing to do is just to be as diversified as you can in terms of uh for one picking different uh fund providers, right? I wouldn't want to buy all of my ETFs from just one provider, right? because each one has different strategies and uh you know some outperform others a little bit here and there but yeah I would just I wouldn't want it to be all with one. Um and you know you can go for different markets like I have I have ETFs that focus on

29:19 banks. I have ETFs that focus on utilities on oil. You can get some that focus on the S&P 500 the NASDAQ. So I think that's the best way to go. And and also there are funds who target they target like maybe a 10% yield. they target a 12% yield, some target a 20% yield. So, you know, you kind of spread it out and uh and take a little bit of each. So, the idea of diversification, I mean, it's this is also interesting to talk about now when it comes to funds because naturally people think about, oh, I'm invested into a fund. I'm already diversified and I can have more of a consolidated portfolio. Now, you had even mentioned earlier that Adriano consolidated. Now he's down to I think you said seven holdings. This idea of

30:05 diversification though to touch on just one more time here. You would say it's all about diversifying in terms of the providers. That's one way to diversify, right? By provider, uh also by country, right? You can have ETFs that focus on Canadian stocks, American stocks, right? Global stocks. So there's lots of ways that you can diversify. Um, and I also think like for somebody like Perry and Adriano who have portfolios in, you know, say excess of a million dollars, they can go for maybe less positions, you know, maybe lower yields and still generate a lot of income. Where with a smaller portfolio like mine, I'm willing to take a little bit more risk on some single stock ETFs to try to squeeze out more income from a smaller portfolio. Are you worried at all about taxes when

30:51 it comes to the the income that you're receiving? I'm not worried about the taxes because I guess about 90% of my portfolio is in tax advantaged accounts. So there's no taxes. The one account there is taxes but only when you start withdrawing the money. Basically it's like you're getting an income. So you have to pay tax on it. When I get my distributions every month I don't pay tax. So in which case a lot of investors would want that money especially if you're younger you're going to want that money now. But I agree with you. If you're going to you should be playing the game of taxes. And if you're heavily invested into these funds, certainly tuck money away into tax advantage accounts. Should there just be anything we should be looking for again for the younger investors who are out there who think that this is kind of like the get-richqu or have my money in my pocket

31:36 by Tuesday crowd. What would you say to them that's like, hey, you got to keep your eyes on this because taxes are going to come out. A guy like Adriana retiring early. I mean, again, you got to think about taxes. Yeah. Well, and and you know, Adriano has openly admitted that he's retired from his nine-to-five job, right? He doesn't have a boss anymore, but he's probably one of the busiest guys I know, right? He's pumping out videos, it seems like almost daily now. He also does one-on-one consultations. So, he's he's actually running a very successful business, right? He's not just sitting on the beach, you know, drinking rum and cokes and relaxing. For anybody who thinks this is a getrich quick scheme, I don't think so. You know, if you have a couple million dollars and you throw it into these ETFs, sure, I guess by next

32:24 week you could be pulling in a lot of money. But if you're starting out small, like I said, it's taken me five years to get to where I'm at. And the first few years is it's very slow. And and like like it you start off slow, but then yeah, then once the snowball effect kicks in, then it grows it grows fast. You know, when I think about when why I started dividend investing, it was the snowball effect that kind of kept me on the dividend hamster wheel of, okay, just put more in, drip the dividends, and I'm going to see more. You I just see these funds and where they're at today. And I it's it's crazy to just see how much income is being generated. It almost emotionally makes me want to start some of these positions up just hearing, you know, you're bringing in5 to $9,000 a month. You know, Perry's over at $40,000 a month. They're crazy numbers. And it almost seems too good to

33:10 be true. And technically, if I had, look at if I if I had have taken my, you know, $130,000 five years ago and put it into the right stocks and maybe Bitcoin, maybe I could be sitting on a million dollars today, which would be too good to be true. Again, I would have had to know which investments to buy, right? And uh and when to buy them. And a lot of people, unfortunately, a lot of people have FOMO. They see somebody making a lot of money on a stock and so they want to get in on it and then there's a correction in the market. You know that stock drops 30% and they get upset so then they sell so they lose money right and then it goes back up again so they buy again. With these kind of funds you don't have to really worry about buying and selling them. You just collect the money. So in that way it's I think it's a simpler way

33:57 of investing. That's the aspect of it that I'm saying it's it's just sounds way too good to be true. And I'm just try I'm always trying to find the the red flag that we're all perhaps missing. And so far can't find as long as you're invested in quality positions. I can't seem to find those red flags. Yeah, I could nitpick the taxes, but if you're invested in these funds and it's in a tax advantaged account, that makes sense. Then I look to the younger investor and I say if these guys want to retire early, they can't have it in the tax advantaged accounts. So is that the red flag? Can you not do that in the states? You can't have it in a tax advantaged accounts and retire early. You you can have I mean if you have a tax advantage account that's great, but it's going to come down to you pulling it out at the age of retirement. And so

34:42 my whole thought process like if you know Ryan and I always talk about this, I'm heavily invested more in dividend growth and thinking, you know, long term. I don't really have plans to retire early, so to speak. Ryan, on the other side, you know, has some plans to retire a little bit earlier, and so therefore, he he doesn't keep all of his money in tax advantage accounts. But I just think about these high yields that are coming out from these funds. See, in Canada, our tax account doesn't really have an age restriction. There's no age restriction. No. So, like in our tax-free savings account, uh, which has only been around for about maybe 18 or 20 years, it's something something newer. They give you an amount every year. You know, they'll say, "Okay, this year you can put $6,000 into it, right? Next year might be $7,000, whatever." But, um, once you put

35:30 the money in there, you can take it out whenever you want. If you put in, there was one guy in Canada who actually he bought a lot of, I think, Shopify when it was really cheap in his taxfree savings account and he sold it at the peak. He grew his account to like $800,000, but he can withdraw that money at any age. Like he could be 40 and he could take the money out um taxree, right? No taxes on it. So if I can get my TFSA where it's paying me $6 or $7,000 a month by the time I'm 55, I can I can pull it out. I hope all the Americans are listening to that. I don't know if we want for those Americans who are saying Canada should be the 51st state. Maybe we should just join Canada. I mean I even going back to what Adriana was saying though I mean there even seems to be and I know a lot of these funds started off

36:16 uh in Canada and then the wave kind of came to the US. So it's just interesting to see you know what's happening in Canada with these funds and the income. I'm wondering like are we behind in America? Well, I mean, you guys definitely have, you know, all the better companies than we do, but it seems like our ETF companies are able to use your stock market to generate income better uh than you guys are. And a lot of our ETFs have leverage. I don't know if you know this, but a lot of them have 25% leverage, which which even boosts the income even more. So, that's really what the game changer has been in the last year or two is these ETFs with leverage. Now, of course, when you have leverage on an ETF, that means the share price is going to go up and down even

37:01 more. So, in a down market, you know, you're going to lose money faster. But again, that's all on paper, right? You're not losing money unless you decide to sell. And I think that would be something at least in my mind that every investor should be well aware of is when you're looking at the leveraged funds, you have to be cautious because volatility is real and volatility can certainly trigger emotions and emotions are are what makes you sell at the end of the day. How many volatile positions would you say an investor should get their hands on? Well, I think you have to build like a base, right? I mean, you have to have a certain percentage of your portfolio that's not volatile. you know, maybe maybe even if only one of your positions is not volatile, but it's 50% of your portfolio, then that'll cover it. I guess after that, you can have as many volatile ones as you want, whatever

37:48 you're comfortable with. In terms though, Ari, I know I've seen you and Ryan talk about like sort of like leveraged, you know, like the new, you know, ETF of the week, the like the the fun ones that are 2x and 3x. Those kind of leverage funds I stay away from, right? I don't I don't want those that type of leverage where you can sort of like go up 200x or down 2x in a day or whatever. I think that's that's for like swing trading or traders, right? If you can see the momentum in the market, you buy those, you hold it for a day or two and then you get out. But um the ones that we have with the 25% leverage, it's it's more modest leverage, right? and it just kind of gives a little bit of a boost, but you're not going to see your whole portfolio drop, you know, 22 2x or something in a day with that.

38:35 Paul, let me ask you this. Is Wall Street getting out of hands? I don't know. Maybe maybe it's getting out of control. But, you know, I I don't have a pension. A lot of people have pensions, right? So, their their investments are kind of like just to supplement their pension. Um, for me, I don't have a pension. So, if I can't if I can't build up my portfolio to the point where it replaces my income, then I I'll be working forever, right? And not that I don't mind working, it's just it's nice to have the option of not having to work if you don't want to, right? Or at least I'd like to cut back eventually. Would you say that your strategy now should be the starting point for most investors? Not if you're young. Guess if you're if you're a young person in your 20s, then

39:21 this is probably not the starting point. You know, you probably be better off just to put your money in the S&P 500 and let it grow and then maybe eventually you could transition over or do a combination, you know, be a hybrid investor and focus on the S&P 500, but also have some income, maybe some different growth stocks as well. So, let's take some of these younger investors then that are investing into the S&P or we'll go even, you know, some of the older investors. they just they started out they're investing in the S&P they're building this foundation or base if you will. When's the point that we could say, "Okay, I think I'm ready now at this point to start to shift gears into an income strategy." Um, I don't know if it's necessarily a certain amount of money, but I guess, you know, if if you're thinking about retiring, you're going to want to switch to uh

40:09 sort of like a a passive income approach, maybe maybe a couple of years out from retirement because you want to know what you're doing. You want to kind of learn the strategy. I don't know if you've ever watched the uh income armchair, but uh the host of that channel, he uh you know, he was a real estate agent. He owned I believe a lot of property, sold it all. you know, now he now he has a portfolio between I think he he sits around 8 to 12%. You know, he buys what do you guys have in the states like the BDC's and other other stuff like that and he's been retired for years now. I think at a certain point you just kind of transition your portfolio whether that's real estate or growth stocks and you you know transfer it into something that's going to provide you income unless you want to just hold on to it and and sell

40:55 shares which is what a lot of people do as well, right? I think that's kind of the old style, but if it works, you know, go for it. What's the process, at least for you, having planned for retirement? How do you know how much money to put into the market for yourself with these income funds or do you just keep going? I mean, I'm I'm young enough that uh you know, I don't really necessarily have to think about retiring yet. You know, I'm trying to get to a point where I could one, I can cover my bills, right? I like to be able to cover my bills. I want to be able to reinvest. You know, you want to keep growing the portfolio uh so that you can fight inflation. I'd like to have extra money to say travel. You know, I've got two kids, right? So, you want to have some money you can help your kids out. So, I think for me the

41:42 goal is it sounds ridiculous to me anyways, but I' I'd almost like to be around 20,000 a month, probably five times my income today. So, do I really need five times the income I'm making now? Maybe not, but that that's my goal anyways. So, with that being said, I'm just curious to get your opinion with with this. You don't have a million-doll portfolio, but yet you're still generating the five to $9,000 a month. You know, five on the lower end and now nine on the higher end, which is even in of itself like an incredible feat. I'm just thinking we're all on this race to become millionaires, so to speak, right? I know like my my goal is like all right the seven figureure club I can bring on anybody on to this this show and it's

42:29 the same goal but yet I hear across the board with income investors. It's actually not the goal. The goal is to generate that passive income to be able to live monthly and to heck with the million dollars. So are we fooling ourselves by trying to be on the race to a million at least at this day and age with the funds that we have available to us? I mean you're a lot younger than I am. So for you, you know, still trying to get to that million dollar or more club, you know, I mean, that's a reasonable goal, right? I'm at the I'm at the point now where I don't want to spend the next, you know, 10, 15, 20 years trying to get to that point. And this is a way of retiring sooner. So, I guess it's a trade-off of, you know, having less money in my portfolio, but having more freedom at a younger age. It's a lot of

43:16 firepower and it it certainly gives you the ability then to to either retire early or at least pull back, you know, and work less hours. Uh it's almost this added uh I want to say insurance for yourself. Is it worth it to go the route of generating the passive income to retire early? For me, it's worth it. I mean, I I I want to have the option to be able to retire or, you know, if something was like, if something was to happen for me at work where I find myself unemployed, I don't necessarily have a lot of options, right? And uh I don't have a pension to fall back on. This is to me it's worth it. And uh what I'm what I'm doing now, Ari, is uh a little bit different than the last few years is I'm trying to start using my portfolio a bit

44:01 more, like actually pulling distributions out to see will it sustain itself? Like am I going to be able to pull money out of the portfolio, not reinvest it, and still have the portfolio generating that level of income. So I've I've last last month I took out $1,000, uh which is not a lot, but I took out $1,000. This month I bumped it up to $1,500. I also put 500 aside for cash. I'm working now at seeing while I'm still working, I'm working on seeing if my portfolio will actually sustain itself in the long run once I retire. Looking at my notes and uh April 8th, uh 2025, my portfolio dropped down to 292 from a high of it was up at 388,

44:47 dropped to 292, and now I'm at 407. So for people who say that like covered call ETFs will not recover, you know, they're just going to lose money. How did I go from, you know, 388 to 292 thanks to Trump, right? And then back to 407. They they really That all comes back down to that underlying position. As long as it's quality, it seems like you'll be back. Well, like the last week, tech stocks have done really well, right? Bitcoin's up, Micro Strategies up, Coinbase is up. I have I have a lot of money in these type of tech funds and you know they're doing well. So as they do well so do the share prices and hopefully next month the dividends will be even better. Were you at all worried when that drop occurred? No. I've been doing this for so long now

45:35 I realized like you learn from guys like Warren Buffett, you have to be able to stomach the ride, right? It's not as much about what you know, it's about like being able to stomach that volatility. I love that approach. I love that outlook. You know, I've taken a look at your portfolio, Paul, on Blossom, of course. And again, for every investor out there, not familiar with Blossom. It really is a go-to community. So, I have a link down there in the description in the pin comment, you can find Paul's portfolio on Blossom. Really get a good understanding of how exactly he is generating over $9,000 in passive income, which is incredible. But Paul, I want to say thank you for joining me on Masters of the Market and most importantly for all the other investors who are out there. Until the

46:20 next goround of masters of the market, we will catch you in the next