PF Achievement Unlocked: monthly dividend income

24 Comments

Yesterday, I bought another dividend stock and succeeded at one of my baby-steps towards self-sustaining wealth: I have a passive monthly dividend income. 

Albeit, a small one, but it’s there!

I know some people disagree with my decision to put money into savings & investments when I still have student loans, but acquiring income-generating assets is just as important to me as eliminating debt.

I used to read Early Retirement Extreme religiously (I still drop by occasionally but I’m not as diligent because I just don’t get the never-travel and take-cold-showers thing), and I was fascinated by the idea that you could accumulate enough wealth for it to be self-sustaining — and to do so on a middle-class income. I really never thought I would be destined to be wealthy because I expect to earn an average income for the entirety of my career, and assumed I would always need to work in order to pay my bills. Reading ERE really made me realize that not having to work (but still choosing to, because I love my job!) is a viable option, and even attainable relatively early in my adult lifetime.

Most stocks pay out quarterly, so when I pick which companies I want to buy shares in, I try to stagger their payout dates so I’m not getting all my dividends at the same time. This isn’t as easy as you might think: I’ve often found if I’m interested in say 5 different companies, 3 or 4 of them pay out on the same schedule. I might just be bad a stock-picking, but I think the financial year plays a big role in this too.

I’m pretty stoked about achieving this passive income goal, because now I feel ready to start building my portfolio in other ways, and I might even put dividend-payers on the back-burner for awhile.

Really I just love that there’s money being deposited into my account on a monthly basis and I don’t have to do anything except let it happen!


24 Comments

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  1. I’m so focused on paying off debt, but I do need to start doing what you’re doing. I know I can get a better rate and income in other places.

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  2. Have you read Mr. Money Mustache’s blog? It’s the same idea as ERE, but a little more palatable for those of us who don’t want to go SO extreme. Also, he’s another Canadian 🙂

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  3. You’re not going to tell us what stock it is? You’re such a tease.

    I’m gonna guess it’s Shaw Communications. They pay monthly.

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    • Bridget (Author)

      I think you misunderstood my post; I said I have a monthly dividend income not that I bought a monthly dividend paying stock. I don’t own any stocks that pay monthly.

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  4. Congratulations! This is one of my 2012 goals as well.

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  5. Congrats! P.s I love the new blog layout.

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  6. I 100% agree with Marissa – the new blog design looks tight!

    Also, I can’t wait to start investing some loot. I’ve got my primary targets met (emergency fund, debt, etc.), so perhaps it’s time.

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  7. So I haven’t done much investing yet. How do you find stocks that pay dividends?

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    • Brian

      Lots of stocks pay dividends. Some of the lists people like to pick stocks off of are the Dividend Champion and Dividend Aristocrat lists. These are companies that have been paying dividends for long periods of time (seen as stable) and raising their payout rate yearly.

      I have a portfolio I have set up using these lists (and some of my own analysis). You could also invest in ETFs that track dividend paying stocks as well and it is a bit more diversified than owning a single stock (Which is seen as risky).

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      • Bridget (Author)

        Exactly what I was going to say!

        I basically Google, read investing blogs, and do my own research on Yahoo Finance. Generally many of the big well-established companies (Coca-cola, Proctor & Gamble, etc) pay dividends, but how much and how often can vary.

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  8. Cognratulations! We are friends so I won’t harass you about the debt. You are way more financially mature than I was coming out of college.

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  9. YAY! Get it, girl.

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  10. Nice job on your goal. Before long you’ll have income rolling in every week. The companies I have work with difference fiscal calenders so some months I get more dividends than others, but oh well. New blog design is so pro looking btw (゜o゜).

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    • Bridget (Author)

      yeah I get more some months too — which is why it was such a big deal for me to finally find one the tpays out between the others haha.

      I have a plan to get a bi-weekly dividend income, but I think it will take some time. I just don’t have the money to invest in the stock market the way I want to right now =\ maybe once those pesky student loans are gone

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  11. I think it’s important to do other things with your money (save, invest, etc) even if you have debt – life doesn’t stop if you’re in debt. Neither do your goals!

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  12. “Dividend income” is another language to me!!

    Great job diversifying your income? savings?

    Eek! I need to read up on this topic 🙂

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    • Bridget (Author)

      haha dividends are payments made by a company to its shareholders. Many companies do it, so if you own shares of say Target or Johnson & Johnson, you’ll get a small amount of money every three months (a certain amount per share).

      It’s a nice way to generate a small passive income — but I use it all to buy more stocks so it’s income that doesn’t really get spent lol

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  13. That is the life and something I hope to achieve myself in the future.

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  14. Over a ten or twenty year period, it’s pretty easy to build an income portfolio that can at least supplement your regular income. The key is to start early and be consistent. You would be surprised what $1000 a month invested every month into quality dividend growth stocks turns into after twenty years.

    That’s what I’m working on, building a dividend income portfolio to support my wife and myself when we are ready for our early retirement.

    Reply