Dividend Income is the best form of passive income. You simply invest in highly profitable
companies and then they pay out a portion of their cash flows to you the shareholder.
You can reinvest these dividends, which creates a powerful compounding effect, or you could
take them as pure cash. Over time, dividend investing can help you reach financial independence
with the ability to live entirely off this income. Because of this, many investors create
countless spreadsheets to try and track their income. I should know, with me being one.
Previously, I had a complex spreadsheet and I would generate graphs to share with you
in my monthly portfolio updates. Well, I’m throwing all that out. It’s time to level
up. Let’s Roll the Intro!
My name is Zach and you should leave a like and subscribe to the channel if you enjoy
the video.
Over the past few months, I’ve been creating my dividend investing research application.
Basically, I’m creating everything I want as an investor. I can track my portfolio,
see the progression of my dividend income, calculate stock valuations, and do in-depth
research. Believe me, this thing is just getting started too. If you want to be notified when
this launches to the public, then click the link in the description or pinned comment
of the video. Here you can see my portfolio. This is my
dividend-focused account which I’ve been sharing here on youtube for over one and half
years. It currently sits at $94,553, with $22,251 in gains. This gives me a total return
of 30.78%. All 21 of my stocks are shown here, with live information updating me on their
performance. A very important thing I measure is my shares
earned from Dividend Reinvestment. These are labeled DRIP shares and they help measure
the total return. You may have noticed in your brokerage, that when you reinvest dividends
these are thrown into your cost basis. This is not correct. Earned Dividends, whether
taken as cash or reinvested, are a part of your total return. Your true cost basis is
the initial dollars you use to fund your portfolio. This is true for capital gains as well. Dividend
reinvestment can be very powerful over time. For example, I have 23 shares of AT&T just
from reinvesting dividends. I have 11 DRIP shares of Exxon Mobil, as well. This is significant
money in its own right, but these additional shares also help increase my future income.
This is the compounding effect at work. My largest holdings are AT&T, Disney, Exxon
Mobil, Microsoft, and Apple. I’ve made videos on many of these stocks. We can see the diversification
of my portfolio. Consumer Defensive is my largest sector and includes Kimberly Clark,
Altria, Kroger, Pepsico, Smuckers, and Coca-Cola. Energy is the second largest with ExxonMobil,
EPD, and Chevron. This year I’ve been able to build up my technology sector, with Microsoft
and Apple. Consumer Cyclical has Disney and a little Mcdonald’s. Then Communication
Services is almost entirely AT&T. Real Estate has FRT and O. Healthcare has Walgreens and
Johnson & Johnson. I own 3M for Industrials and the Materials Sector has Scott Miracle
Grow. Alright so that’s my entire portfolio, now
let’s look at my income page. This is my full history of earned dividends. You can
see how it’s grown month by month, and it’s going to be really exciting to look at how
this evolves years down the line. In total, I’ve earned $3,817.55 in dividends. During
2021, I’ve earned $2,332.60 in dividends. My average dividend income over the last 3
months is $236.79. The rolling average is shown by the orange line in this graph and
really helps visualize your income growth. When you project my 3-month average over 1
year it’s $2,841.48 in dividend income. In reality, I’m going to crush this because
I’ll be buying more shares, reinvesting dividends, and the dividend payments of my
companies will grow over time. Here you can see all the stocks I’ve earned dividends
from. AT&T has generated $642.53 in dividends, which is over 16% of my total dividend income.
Exxon Mobil has earned $580, which is 15.2%. FRT earned $255.67, which is 6.7%, Altria
earned $233.78, which is 6%, EPD earned $200.18, which is 5.24%, and 3M earned $169, which
is 4.43%. You’ll notice a somewhat obvious trend here. My highest-yielding and longest-held
stocks have generated the bulk of my dividend income. Makes sense. I have all of my earned
dividends tracked here, even my 16 cents from Tootsie Roll.
We have the diversification of my dividend income shown visually. Energy, Consumer Defensive,
and Communication Services are the most significant. One big takeaway is the difference between
my portfolio allocation to technology and how much dividend income it’s actually generated.
This is because of how low-yielding those stocks tend to be. It’s important to remember
that we’re trying to strike a balance between current earnings and future earnings. Many
of my technology dividend payers are growing their cash flow rapidly and have a high capacity
to pay dividends. So even though they have a low initial yield, they are increasing their
dividends at high rates. This is something we discuss often on the channel.
Let’s look at my upcoming dividends. On the 11th, I get $9.71 from Apple, followed
by $48.82 from EPD on the 12th. My biggest payments coming up are $56.22 from Walgreens
and $131.13 from Exxon Mobil. On November 1st, I earned $206.91 from AT&T and got 8.1328
from reinvesting dividends. Since, my last portfolio update, I purchased
54 shares of AT&T at an average cost of $25.72, giving me an 8.09% yield on cost. I bought
5 shares of Altria at an average cost of $44.94, giving me an 8.01% yield on cost. 5 shares
of Kroger at an average cost of $38.67, giving me a 2.17% yield on cost. Finally, I bought
10 shares of Walgreens Boots Alliance at an average cost of $45.37, giving me a 4.21%
yield on cost. In total, these stocks will add $153.62 to my annual dividend income.
This is at a 6.8% dividend yield on cost.
The creation of my dividend investing application has been my main focus over the past few months.
I’m still rapidly adding new features and am happy with the progress. Remember if you
click the link in the description and pinned comment you can be notified of when my website
launches. There will be much more news later this month. Once released, I plan to do way
more stock review videos. So get ready!
Thank you for watching Dividend Data. I’d greatly appreciate it if you leave a like
and subscribe to the channel. If you follow me on Twitter, link in the description, you
can real-time updates of my buys and dividends coming in. You can support the channel over
on Patreon, where you can gain access to a community discord server. The link is in the
description. Please leave a comment below and thank you for watching!