Creating your own investment portfolio that can provide you an ever
increasing dividend income stream need not be difficult if you stick to some basic guidelines and investing principals during all market conditions.
If the dividend has increased, and the stock price has not yet risen to keep up with the increased dividend, this again gives you an opportunity to buy more shares and
increase your dividend income at a relatively low price.
Secondly, I will opportunistically invest new money to
increase my dividend income.
In terms of side income, I did purchase some shares of NSC a little while ago, so that will
increase my dividend income.
As each company increases their dividend you will buy more stock which
increases your dividend income which allows you to buy more stock which increases your dividend income.
I originally anticipated that I would
increase dividend income each month.
Secondly, I will opportunistically invest new money to
increase my dividend income.
The end goal is to continue reinvesting proceeds and other passive income streams into your dividend portfolio over time and to
increase your dividend income to a point where you can live off of it without working!
Increasing my dividend income is what I had been into for the period of January to May 2011.
As mentioned in my ultimate ambitions post, the long term goal is to
increase dividend income to a minimum of $ 2500 per month.
This strategy will allow me to dollar cost average into the market AND
increase my dividend income (index funds pays dividends).
However, to answer your question, there are two main drivers to
my increased dividend income.
If I stick to to the plan, I will
increase dividend income, save more money, and have less debt by the end of the year.
Starting with $ 100,000 and assuming your average $ 30,000 per year contributions (which would not remain constant because of
increasing dividend income but for this I assume that it does) and assuming an average 20 % return per year (the average 10 % stock market gain + 5 % average dividend yield + 5 % average dividend growth) in 8 years (I think you said you're 32) you will have $ 1,023,948 by age 40.
This solid economic foundation offers shareholders the potential for both a strong margin of safety and an opportunity for
an increasing dividend income stream and potentially attractive future returns.