I am mostly a growth investor but now that I am semi-retired I decided to create a portfolio that will provide a steady income stream that will steadily grow forever over time. This will be a new project strictly focused on the growth of dividend income.
Every task should have some goals so here are some specific basic goals that I set as a bench for myself to measure my progress.
- Total dividend annual growth of 3%.
- Minimum Average Yield of 3%.
- Annual dividend totaling $10,000 by 2023.
The expected raise for workers in the US for 2018 is 3% therefore my target for 3% annual dividend growth is to keep in line with those figures. Just as salary earners are expected a raise, I expect the same from my investments.
Choosing the investments and maintaining the appropriate amount of risk to get to an average yield at a specific target may be difficult but any yield should be above the core inflation which is currently at 2.2%. For now I plan on keeping things simple.
PURCHASES
FAGIX (Fidelity Capital & Income): Have owned this for many years. Now assigned into my dividend project. Yields currently at 4.04%. Have been reducing my holdings here due to the rising interest rate environment but due to its high quality corporate bonds, still holding.
FSTFX (Fidelity Limited Term Municipal Income): Have owned this one for many years as well. It is part of my risk off cash holdings currently yielding 1.53%.
T (AT&T): Purchased 373 Shares at $32.02! Have been in and out of ATT all my life and current prices look like a nice entry point. Current yield at 6.23%! This lot should increase my dividend income by around $63.13 per month. That should cover a utility bill! Sweet!
ETP (Energy Transfer Partners): This one is slightly more on the risky side. This is a MLP stock with a yield of 11.87%. Bought 217 shares at $18.42. That gives me $40.91 per month.
Fundrise: This one invests in real estate and included for diversification purpose. I love real estate and after some research I found this platform intriguing. Invested 14K which is yielding around 3.8%. Resulting in a dividend of $44.33 per month.
SALES
NONE.
Total Investments: $121,019
Total Yield: 3.9%
Monthly Dividend: $390.82
Annual Dividend: $4689.81
Looks like a long way to $10,000 annual! Would love to hear some feedback on ideas and what other ways you guys generate dividend income. I will periodically update to keep you guys updated!