*This blog post is my personal opinion only and contains affiliate/referral links.
In the last few days, i’ve been reading a lot of posts and articles on dividend investing. I thought i was just refreshing on old ideas that i have encountered already, but i came to realize that i’ve been passive on re-learning this concept maybe because i knew the dividends were flowing and showing up quarterly, semi-annually or annually on my reports.
While in the sideline with a cold beer on one hand, i watched my dividend grows and was (and is still) happy for this almost undetectable income. Foresight and habits of investing in Betterment, Vanguard, Fundrise… enable me to build what i have today.
In technical term, i am enrolled on DRIP or Dividend Reinvestment Plan, which is basically any earning from my investments are pooled back to their source which contributes more to it’s overall growth.
While i was looking on these accumulated dividends, it dawned on me again the mindset that made me decide to reinvest them. I was young (then) and i was busy and i wanted to autopilot my investment on my way to early retirement. I also didn’t have anything to support but myself.
Fast forward now, i have a family with one child and on a different spectrum of priorities.
One glaring thing i noticed during my reading and investment review is that i don’t have an ETF or mutual fund that is solely for dividend income. Apparently, there are funds that focused only on equities or bonds that yield high dividend than the others. Managers are partial to companies that are established, stable and has growth potential, understandingly.
Whether for dividend yield or dividend growth, this investing strategy is one goal that a serious investor should definitely consider. This new perspective leads me to look into two Vanguard ETFs to add to my portfolio: VIG (Vanguard Dividend Appreciation) and VYM (Vanguard High Dividend Yield).
Also on the same vein, i am also tracking individual stock companies from these two ETFs and planning to add some of them on my personal stock portfolio.
The last consideration that is playing around in my head is opting in on direct deposits for these dividends. For this reasoning, i have to re-evaluate my situation and ask myself if i need these immediate monies and where and how i will use them.
Knowing we are on a down market and a lot of distress quality stocks are out there, i have to exercise control and due diligence before i open up my trading account for these dividend earnings.
One important lesson i continue to practice is to invest only on money that i can afford to lose. This volatile market is teeming with opportunities and can be very tempting to ride with “play money”.
There’s a whisper in the wind that caution me to take big risk and on another ear it is saying to use it on a less risky side hustle or just save it for emergency fund.
Wherever the sail takes me, be properly guided that as priorities change our attitude with money also changes. Be comfortable with your money management and you will have less regrets.