August Dividend Portfolio Update 2024 🔥 🚀
Gains Everywhere! 💸
There is a huge misconception around dividend investing.
More specifically, dividend growth investing.
Most people typically think you would only buy a dividend stock for the dividend payments it is currently paying.
But this isn’t why you should buy a dividend stock.
If you are an investor with a long time horizon, you should also be buying stocks for:
Capital Appreciation
The dividend they will be paying 10 years from now
For example, when people hear I’m a dividend investor, they typically wonder “If my dividend payments offset my capital losses”.
These people do not understand true dividend investing.
Look at the gains I’ve seen from the current holdings in my portfolio.
These gains are a byproduct of buying companies that can consistently grow free cash flow, and buying at the right valuation.
Speaking of companies that grow free cash flow, these are the same companies that have the ability to increase dividend payments over time.
So when I buy a stock that currently pays a $1 dividend, I’m not buying it for the dividend it is currently paying. I’m buying it due to the fact that dividend payment in 10 years will be $3, $4, or even $5.
Look at Visa for example.
Their dividend payments have gone from 10 cents per share to 52 cents per share in 10 years time.
People probably thought you were crazy for buying Visa for the dividend payments 10 years ago.
And people often think the same thing now.
But they can’t understand the concept of buying a dividend stock for the dividend it will pay 10+ years in the future.
Even though I’m buying dividend stocks for the dividends they will pay in 10 years, my average monthly dividends is very close to the $500 a month milestone.
And that number will keep growing, regardless if I contribute more capital.
I also hit a major milestone this month, hitting over $200,000!
Each $100,000 comes faster and faster due to the compounding effect.
I can confirm this, as my first $100,000 felt as if it took a very long time.
But the second one?
It felt like no time at all.
I contributed very little capital to my portfolio this month, but it still grew by a large amount.
The math is simple.
A 3% gain on $1,000 is only $30.
But a 3% gain on $200,000 is $6,000.
The more your portfolio grows, the more gains you’ll see from small jumps up in the market.
So keep growing, keep compounding, and keep buying stocks for the dividend they will pay 10 years from now, not just the dividend they are paying now.
Tweet of the Week:
Check out these resources:
Tickerdata 🚀 (My automated spreadsheets and instant stock data for Google Sheets!)
Interactive Brokers 💰 (My favorite place to buy and sell stocks all around the world!)
Seeking Alpha 🔥 (My favorite investment research platform!)
Other News…
At the start of every month, I send out a newsletter to my paid newsletter subscribers with a list/spreadsheet of all the dividend stocks that I believe to be currently undervalued.
I’ll be sending out this months update in a couple days.
If you’d like to receive this sheet, you can sign up here:
That’s all for now!
See you next week!
Dividendology 🚀