Most people enjoy rainy days as long as they don’t need to leave home. There is something soothing about listening to the raindrops outside their windows.
Something I find even more soothing is the sound of dividends hitting my brokerage and checking accounts. There is nothing quite like getting a text, email, or notification saying you are receiving free money.
When I first started dividend investing in June 2019, I received tiny raindrops of $0.25 per month. Now, I am living in a full-on thunderstorm with a $2,100 monthly dividend income.
House Rich, Cash Poor
More importantly, dividends have changed my life significantly. Where I used to have a ton of fear and anxiety, I now face the world with confidence and composure. I have my dividends to back me up.
Why did I start dividend investing? I wrote “It’s Raining Money: How Dividends Can Change Your Life” in March 2022. Dividends had already changed my life, as I was earning roughly $770 per month.
I started dividend investing in June 2019 because the old way of doing business was not working for me or my family. I was tired of being in debt, broke, and bullied by the world.
I take my job as a provider very seriously. Although my wife and kids had food on the table, I depended on my credit card each month.
I wondered how rich people got ahead in life. My wife and I were both working over 40 hours a week, and we still were behind. How do you get ahead when you can’t work more hours?
The Biggest Book on Passive Income Ever 2!
The answer to this very simple question is passive income. You must earn money while you sleep. Without the information, this is truly a trick question that most people never answer (even after 80+ years).
Create passive income via dividends. Although there are many ways to create passive income in 2024, dividend investing is still the most straightforward.
To become a wealthy dividend investor, you must believe in dividends. You must trust that companies and fund managers will take your money and put it to work.
I say this because most people believe they can grow their money better than professionals. They end up keeping their money in a standard savings account (as opposed to a high-yield savings account) out of fear and a scarcity mindset.
That’s why I always recommend people start dividend investing very slowly. You must believe that McDonald’s (MCD) will pay their quarterly dividend on time and without issue.
Don’t Gamble with Retirement 6
Becoming a dividend investor will turn everything you know about finances on its head. Normally, you receive your paycheck, implement a budget, and save a little for a rainy day—if you are lucky.
Dividend investors add one crucial step in the process—paying themselves first. Living on passive income means converting earned income (from your job) into passive income from assets.
Each share you purchase of dividend-paying stocks is an asset. The more assets you have paying you money, the less you must work. Eventually, you can stop working and live entirely on dividends and passive income. Let’s give an example.
Living on Altria (MO) dividends. One of my favorite dividend stocks is Altria (MO), which is a tobacco company. I like to purchase their stock when it has a massive 8% dividend yield. Currently, the stock price has soared, which lowers the dividend yield.
Build an Investment Portfolio in 8 Steps
To change our lives, we must prioritize investing in income-producing assets. Let’s say we earn $10,000 per month as a family and can invest $1,000/month into MO.
Let’s say we had 2,000 shares of MO on Aug 27, 2014—exactly ten years ago. Our portfolio would be worth $85,640 ($42.86 x 2,000) and pay us $3,840 in annual dividends (roughly $320 per month).
For some reason, we couldn’t add more capital to our portfolio for ten years. In Aug 2024, our portfolio would be worth $105,420 ($52.71 x 2,000) and pay us $7,840 in annual dividends (roughly $653 per month).
Wait, how did our income increase without us adding more income? That’s the magic of dividend growth investing: companies raise their dividends annually. Imagine if you kept adding capital plus reinvesting the dividends; you would have quite the lump sum and income stream.
My Favorite High-Yield Savings Account
How could $653 per month change your life? Does $653 per month seem like a lot of money to you? So many people want to earn thousands of dollars per month from dividend investing, but that takes time.
When I reached $500 per month in dividends, it was an extraordinary achievement. I felt back then that nothing could stop me, and I feel even more emboldened today.
Dividends allowed me to retire early. After 24 years of service, I left the Marine Corps in 2023. The government pays me $9,000 per month in passive retirement income, which is a massive sum for a poor kid from San Diego.
However, even having that much passive income isn’t enough for life’s little challenges. There is always something going on, especially when you own four houses.
Can You Achieve Work-Life Balance 3
Adding another $2,100 per month to our passive income totals gives me the security to live on my terms. I feel like I have an abundance of income to solve life’s problems.
How can dividends change your life? But enough about me, how can dividends change your life? What do you want to do but don’t have enough money to accomplish?
Would you like to travel overseas for an annual vacation? If I saved my monthly $2,100 for the year, I would have $25,200 in vacation dividends.
Do you want to put your kids in private school or perhaps be in a position to homeschool them? The magic of dividend investing is freedom of choice. You can choose your financial destination.
However, to start dividend investing, you must generate enough capital to invest in the markets. This is the part that prevents most people from starting.
I recommend investing $100 per month in five dividend stocks ($20 each). Once you master the process and start seeing dividends in your account, you’ll want more.
Sleep Easy: Make Money 24 Hours a Day
Let’s call it the dividend snowball effect. In reality, it’s called the compound effect. The money your investment creates will soon create its own investment. The human brain cannot fully digest the future potential of compound interest.
You want to have access to as many compounding assets as possible. Dividend investing is the start of a compounding process that will change your life.
The chart above shows how my dividend investing journey has grown. I started investing at age 38, but imagine if I had started in my 20s.
What Type of Business Should Your Start 5: Consulting
Conclusion. The most powerful element of dividend investing is the ability to pass the information on to our kids. My kids already have brokerage accounts; they are 20 years ahead of me.
The power of compounding only requires time. The more time you give it, the more powerful its effects. I can pass along this power to my children because I learned it.
Therefore, dividends can change your life, but there is much more at stake. Why must our kids spend 40 years figuring it out when we already have the answer?
Start a Fitness Business Toward Passive Income
I used to worry deeply about my kids’ futures. However, once I became an investor, I realized that I had the power in MY HANDS.
My kids already own a home and have brokerage accounts. More importantly, I will give them the information they need to maintain and grow their portfolios and assets.
What we do today matters for tomorrow. Starting a $1,000 dividend portfolio will change your life almost instantly. Most people will never knowingly earn a dividend or passive income outside of social security.
If you want different results, you must do things differently. What is your dream retirement? What resources would you like to give your kids early in their lives? Those powerful images should push you to become a dividend investor. Good Luck!
- PDF of the Month: Don’t Gamble with Retirement 12 (Free 460-Page PDF)
- Free PDF Downloads: Download FREE PDF LIST here
- Financial Mindset: Become CEO of Yourself 2 (Free 196-Page PDF)
- Retirement Planning: Your Retirement Planning Guide 2 (Free 255-Page PDF)
- Investing: How We Plan to Retire on Dividends 4 (Free 139-Page PDF)
- Cryptocurrencies: Counting on Crypto 2 (Free 159-Page PDF)
- Real Estate: Financial Independence through Real Estate 4 (Free 112-Page PDF)
- Business: Retire Rich, Retire Comfortable with a Business 4 (Free 149-Page PDF)
- Latest DGWR: Don’t Gamble with Retirement 11 (Free 410-Page PDF)
- Everything!: The Biggest Book on Passive Income Ever 4! (book)(Web Edition)(Art Edition)
- Writer’s Comparison: M1 Macbook Air vs. GalaxyBook3 Pro 360
- Read My Books for Free: Free Kindle Books Schedule
- Book Design: Design Tips on YouTube
- Kindle Unlimited: Why I Finally Subscribed Kindle Unlimited (learn more)
- Book Reviews: 505 Takeaways from 101 Books (pdf)
- Writing: The Publishing Chronicles (Part 1, Part 2, Part 3, Part 4, Part 5)
- Best REIT- Fundrise: Fundrise vs. US Treasuries (Join Fundrise)
- Follow us: On our Facebook Page and Join our Facebook Group
- Support the Channel on Cash App: $Kingmarine1981
- For more detailed analysis, join my Youtube: MFI YouTube Channel
PDF of the Month: Don’t Gamble with Retirement 12 (Free 460-Page PDF)
Disclosure: I am not a financial advisor or money manager, and any knowledge is given as guidance and not direct actionable investment advice. I am an Amazon Affiliate. Please research any investment vehicles that are being considered. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article. All Right Reserved Military Family Investing
Leave a Reply