These days I am buying low dividend yield investment with strong dividend growth (also known as the 10-10 dividend growth stocks) so I can’t expect to see an immediate lift in my monthly dividend income.
In fact, the yield of the companies I recently purchased shares in have the following yield:
My May dividend income adds up to $928.80. It’s slowly inching towards $1,000 per month. Even after adding future dividend income from my recent purchases, I don’t see a consistent $1,000 per month but I will earn over $12,000 in dividend for the year. As I mentioned earlier, dividend growth is more important in my accumulation years in order to grow my portfolio larger.
Investing is a very slow process and requires patience. We are all bound to make some mistakes early and the faster we course correct, the faster your money can work for us. The following graph will highlight how money at work can accelerate your growth – also known as compound growth. In the earlier years below, I was establishing my process and focused too much on high yield stocks. Over the years, during my dividend stocks research, I found that dividend growth was a better fit for the long-term during the accumulation years.
In fact, there are a few stages to investing where your approach may change.
- Starting Phase – This is when you figure out your strategy
- Accumulating Phase – This is when you save and put your money at work
- Income Phase – This is when you are starting and living off your retirement income
If you happen to have done well during your accumulation phase, you may not need to change your approach in retirement but it’s possible that you may want to switch to higher dividend yield over dividend growth.
With my recent purchases, I have added 2 more companies to my holdings bringing my total number of stocks to 32 unique stocks. My biggest diversification is really through my US holdings since Canada tends to have less options. In fact, I have found 26 stocks matching my 10-10 dividend growth investing goals and some of the companies do not fit my 7 investing rules.
DISCLOSURE: Please note that I may have a position in one or many of the holdings listed. For a complete list of my holdings, please see my Dividend Portfolio.