investing in dividends is a great way to create passive income but i do have to be honest with
you guys and the truth is if you want to make a hundred bucks a month in dividends
it's not that easy to do you have to have a lot of patience obviously you need time and you need
a lot of capital in order to invest in different investments to even make a hundred bucks a month
in dividends so in this video i'm going to teach you guys how to do the math yourself
so that you can find out based on which investments you're looking into as to how much
money you actually need invested to make a hundred bucks a month in dividends and just keep in mind
that i am not a professional investor by any means so take this video for entertainment purposes only
but at the end of the day hopefully you guys can learn some basic math as to how to calculate some
basic dividends so to start off i'm going to be using a t as the example here because honestly
they have a pretty good dividend yield right now of 7.27 percent and that's really high considering
they've also been paying out dividends for a very very long time now if you do want to look up at t
on the stock exchange their ticker symbol is just t but keep in mind this is just for illustration
purposes only i don't want you guys using this as a strategy to invest in dividends because there's
a lot more to look into you can't just look at a company right on the outside and then invest a
whole bunch of money into them expecting that your dividends are going to work out in the long run
there's a lot to it here but this is just going to be a good example because they have a pretty
high yield and they've been paying dividends out for obviously a long time current share prices
of at t are going for 28 and 80 cents and so that's the number that we're going to be using
for the math today but if you guys get on the stock market tomorrow that number is obviously
going to fluctuate so you're going to want to go with the current numbers that way your math is
always accurate and then also when it comes to the dividend yield that number is also going to
be fluctuating as well because it's based off the share price and so every single day that yield can
fluctuate a little bit so we're not going to be looking quite at the dividend yield we're actually
going to be looking at the dividend payout as far as cash goes and i'll explain that right here for
you guys so if you want to make a hundred bucks a month in dividends you are only going to need
two numbers here that are going to help you do this math correctly the first number that you're
going to need is the actual share price and then the second number that you're going to need is the
annual dividend payout per share it's really easy to find and technically speaking it's just called
the annual dividend that's all you have to look up under any stats now like i said earlier at t is
currently trading at 28 and 80 cents per share and then their dividend payout is 52 cents per share
but keep in mind that's being paid quarterly so we have to multiply that by four and that turns
out to be two dollars and eight cents that's the annual dividend and this is the other number that
we needed so we just needed the share price and the annual dividend and now we have them both
so in order to do the math easily here we need to take the amount that we want yearly which in
this case is going to be 1200 bucks because we want to make a hundred dollars a month now once
we have 1200 now what we're gonna do is divide that by two dollars and eight cents which was
the full dividend per share per year and like i said before that's called the annual dividend now
we're going to get 577 which is how many shares you need to own right now to make a hundred bucks
a month in dividends from the at t example but in order to make that hundred bucks a month we need
to own those 577 shares so we're going to have to multiply 577 by the current share price of 28.80
and now at this point you're going to have 16 617 bucks and that is exactly how much money
you're going to need invested today in order to make a hundred dollars a month in dividends
from once again the current at t example so as long as you have the current share price and the
annual dividend you can plug in these numbers for yourself and you can see how much you're going to
need invested in order to make however much you want per month in dividends now obviously this is
just basic math here but if you are looking into these different companies and you buy low and you
get an exceptional value on those specific companies then with your dividends you can
actually reinvest them into that same company and over time assuming the stock price is going up and
the value of the dividends are also going up then in time you're only going to be making more money
per month on those dividends but you do have to have patience and time in order for this to work
because even if you were given a hundred thousand dollars tomorrow and you decided that you wanted
to start dividend investing then it's not the wisest thing to just go buy some random company
just because they pay out a good dividend because the value of that share price might not actually
be where you want it to be and you also have to make sure that the dividends are going to
be sustainable for a long time because a lot of companies can run into trouble and they can cut
their dividends at any given moment and you don't have control over that so you want to be wise as
to what you're investing in and how long you plan on doing it for now if you are interested
in getting a free stock i have an affiliate link for weeble in the description below where they'll
actually give you a free stock valued up to 600 bucks just for depositing a hundred dollars and
opening an account with them so if you have an interest in getting a free share definitely check
them out also if you just found this channel i'm jason with honest finance and i make a lot
of videos on different topics that'll give your life and your finances more value so if you do
have an interest in this type of content feel free to subscribe and then i'll leave some more
stock market investing videos that you guys can watch but thank you for watching have a great day