Owning stocks from my Master Stock List, I’m generating passive dividend income from my Vanguard taxable account.
Each month, I contribute dollars to my Vanguard money market account and wait for it to build enough cash to purchase a dividend stock(s). Now that Vanguard has free stock trades, I’ll likely start building smaller positions in quality companies. In Q1 of each year, I also receive annual bonuses that will go to the purchase of dividend stocks too.
Goal
Generate over $15,000 in forward annual stock dividend income by 6/30/25.
Updated Income
Honestly, I didn’t think I’d be too interested in higher yielding stocks but there is some good quality available. In Q3, I put over $16,000 to work in the following stocks:
- Phillip Morris (PM)
- Johnson & Johnson (JNJ)
- Altria (MO)
- Exxon Mobil (XOM)
- AT&T (T)
I’m pretty loaded up on Exxon Mobil already but it was just too hard to add at these low prices. I’ve taken a beating on oil this year and Exxon is already 33% of my dividend income. That obviously is in the process of being reduced with new capita but it’s a concern. If Exxon cuts their dividend it will be a significant blow to my $100,000 taxable portfolio.
The good news is that I spent Q2 rethinking my portfolio and I’m confident of the stocks on my watch list. The best we can do is learn and adjust until we get it right. Which is why I’m hoping others can learn from my mistakes before their portfolios suffer.
Summary
My focus in Q3 was to regain the dividend income lost to a few dividend cuts. I’ve recouped the lost dividend so now I’m building some cash until we know more about what happens in Q4 (i.e. election, vaccine, stimulus, etc…).
Of course, being patient until we see some value from our Master Stock List. At the moment, I’m reinvesting dividends and will likely do so until I receive over $10,000 per year in dividend income. Even then, I’d likely I’ll still reinvest dividends on some stocks.
Looking 12 months out from today (October 2020 – September 2021), I’m expecting to receive $5,728 in forward dividend income. This is assuming I make no changes (or additions) to my current stock portfolio. This leaves me $9,272 short of my $15,000 dividend income goal (by June 2025) but I’m happy with my progress and I’ve got to time to close the gap.
Thanks for reading!
Mr. TLR