Welcome to my latest dividend income update. For those of you new to these posts on my site, every month I discuss my approach to investing using Canadian dividend paying stocks and some Exchange Traded Funds (ETFs) to help reach financial freedom. There is more to my portfolio beyond these investments but this approach is a big part of it.
Outside of a few ETFs in my RRSP, I now own about 30 Canadian dividend paying stocks with no intention of selling any of them in the short-term, including this one that has cost me a few hundred bucks in losses to date. (I’m tempted to hold this lame duck until I can offset some capital gains next year). Let me know in a comment what you would do…
Over the last six years or so, I’ve picked my spots to buy then hold my Canadian dividend paying stocks. In my portfolio I now own:
• Multiple financial companies,
• Multiple energy and utility companies,
• Multiple material companies,
• Multiple telecommunications companies, and
• Multiple infrastructure companies.
I figure I’ve pretty much made up my own Canadian equity index fund. Going-forward I will continue to reinvest dividends paid from most of our companies owned to buy more shares commission-free each month and quarter. I’m predicting this portfolio should help us retire in about 15 years or less, as long as we continue to make steady monthly contributions to our Registered Retirement Savings Plans (RRSP) over the same timeframe.
Since my last update, our dividend income has increased but we don’t dare touch or spend any of the money earned since this is our retirement income fund. There will come a day when we can spend the money generated by our investments but that day is definitely not now. As long as the companies we own continue to pay dividends at their current rate, and we reinvest the dividends paid by many of these companies, I’m predicting our dividend income will be just over $9,000 this calendar year. This is almost 1/3 of the way towards our long-term goal.
Along with indexed Exchange Traded Funds (ETFs) my plan is to purchase many blue-chip companies when prices fall and hold those companies for decades; to eventually live off the income generated by the investments and avoid touching the capital until old age. We’ll see if prices fall or correct this fall. As an investor, I hope prices dive.
What are your thoughts on this part of our retirement plan? What do you think about my comment about wanting prices to crash? I’d love to hear some feedback.