August 2023 Investing Update

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For the month of August, the DOW lost 378 points. This puts the DOW up 5.13% for the year, and up by 11.86% in the past 12 months. My interest and dividend income was $1973 for the month. Withdrawals for living expenses came to $1163 in the past month. So far this year, my investments have gained 5.76%. This is above the current annualized inflation rate of 3.3%. In August, I made some minor adjustments to my closed end fund holdings. I sold 200 shares of PFN and 100 shares of ETY. I then added 100 shares of RQI. I also added 100 shares of QCLN at an average price of $44.95. QCLN’s top holding is Tesla with 9.20%. I am hoping that Tesla will continue to have strong growth despite growing competition. My target sell price on QCLN is $56 per share.

This past month I was informed by my brokerage that my largest mutual fund holding would be converted into an ETF. It is a large cap index fund with a 5-star rating from Morningstar. The top 5 holdings are AAPL, MSFT, AMZN, NVDA, and GOOG. Year to date this fund has gained 17.69%. I added this fund to my holdings in 2020 and it has gained 56% in three years. I’m not sure how I feel about the fund becoming an ETF since this is an investment that I didn’t plan on selling. In fact, I have been using the dividends to buy more shares. They say that the benefits would be lower net expenses, additional trading flexibility, increased portfolio holdings transparency, and the potential for enhanced tax efficiency. Only the lower expenses and holdings transparency would be of interest to me since this fund is in a tax deferred retirement account. One possible negative would be that as an ETF, option traders could short the ETF, placing downward pressure on the share price. Of course, with such a positive growth history it would be foolish to do so.

August was a good month for tax rebates. I received a $3400 property tax rebate and a $260 State tax rebate. The property tax rebate was $580 larger than I had expected and will help replenish my shrinking checking account. With an adjusted gross income that is under the $12,950 standard deduction, I qualify for a number of low-income benefit programs. The property tax rebate and low-income health insurance are the two things that have made it possible for me to retire before I am old enough to receive social security benefits. I also quality for food assistance and lower cost Internet access but I felt like that was not necessary in my situation. Although, the Internet cost reduction would save me $360 per year, I read that only 28% of those that are eligible are taking advantage of the Affordable Connectivity Program. Your income needs to be less that 200% of the federal poverty level, which is currently $14,580 for a single household. I didn’t like the fact that you may have to submit a copy of your income tax return to your Internet provider to get approved. Also, funding will run out in 2024 if action is not taken to re-fund the program. So, it may not be around much longer.

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