While this isn’t my primary goal, I think these types of results are possible (largely due to my expected savings rate) and while I don’t have plans to change my strategy and/or increase my risk threshold in an attempt to bolster returns in the near-term, I look forward to what the next 5-10 years hold as I continue to follow the dividend growth path towards financial freedom. Looking forward, if I’m able to generate 18% annualized dividend growth over the next 8 years, I will see my dividend stream go 4x again.
With 2021 completely in the books, I took a look back at my long-term dividend data spreadsheets and saw that my 2021 dividend income was more than 4x the size of my 2014 passive income (the year in which I began tracking data for these spreadsheets). The potential for compounding to turn exponential is one of the biggest long-term benefits of the dividend growth strategy. This is so great so see because my long-term retirement plans are based off of a more conservative 10-12% annual dividend growth rate.Įvery year that I’m able to produce results which exceed that range, I’m accelerating my journey towards financial freedom.Īnd with that in mind, the 14.99% passive income growth that I generated during 2021 was a big step in the right direction.Īs you can see on the chart below, the compounding trajectory at play within my portfolio continues to - slowly, but surely - result in a steepening upward trajectory. These savings, alongside the continued re-investment of dividend and the organic raises that they holdings provide me (every single company that I own which pays a dividend raised its dividend in 2021 and looking at fundamental outlooks and dividend safety metrics across my portfolio, I expect that trend to remain in place moving forward into 2022 as well), combine to result in strong, reliable double digit growth. My portfolio has produced 20%+ y/y monthly dividend growth results during 5 out of my last 7 months and moving forward, I expect to see this trend remain in place (due to my continued plans to put monthly savings to work, growing my income stream in an inorganic manner). Therefore, 2021 as a whole was a pretty wonderful year as well.
This 20.30% y/y growth rate during December pushed my overall y/y dividend growth rate up to 14.99% (I was hoping to get to 15% on the year, but I’m not going to sweat that 0.01% short-fall). This provides a great deal of solace throughout periods of market volatility and allows me to stay calm, cool, and collected, which in turns, helps me to avoid many of the common pitfalls that many irrational investors face in the market which are ultimately inspired by fear and greed. Regardless of what the market throws at me… short-term volatility, taper tantrums, irrational valuations, a 100-year type of global pandemic, etc., etc., etc., my dividends continue to grow higher. And, it’s so amazing to see the compounding process here continue to play out. The dividend income that I generated during December was up 20.30% on a year-over-year basis. It was great to end the year off on a high note! You know how the saying goes… another month, another step towards financial freedom.ĭuring December of 2021, my portfolio generated its best all-time mark for monthly dividends. This article was previously published for members of The Dividend Kings.
0 kommentar(er)
