Dividend Income Goals

 

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Ultimate Dividend Goals:

When I was a young guy- very young, I can remember having a savings account that paid 7% interest. I can almost remember having one that paid 5 3/4% compounded daily. Those were the days. When I was about 16 years old, I was talking with my father and the subject came up about retirement income and how much I needed to ultimately have saved to generate the desired total. At the time, the magic number was $70,000. That was in the mid 80’s and 7% was an easy mark on a cd- so $1,000,000 was the other magic number. How things have changed.

 

1. High interest rate cds are currently a thing of the past.

 

2. With inflation, that $70,000 is not what it used to be.

 

3. Because of the low interest rates and the need to keep up with inflation, the $1,000,000 is not nearly enough.

The question now becomes how do I get the “nut” and how much do I need?

Many ways to accumulate the “nut” come mind, but I feel that one of the best ways to accumulate great wealth over a working career would be to regularly contribute as much as possible to IRAs and also, in my case Simple IRAs and invest in good companies that pay growing dividends regularly.

I have been using this process for many years now. I am nowhere near generating the amount that I want to ultimately generate, but I am on my way. That original $70,000 goal is potentially in sight, but the new number ($150,000) is somewhere down the road. Given that most of my stocks return about 3-4%, the number needed to accumulate is somewhere north of $4,000,000. Given the effect of compounding and reinvesting the numbers will not be exact, but this gives me a frame of reference.

So, as of September 2014, my ultimate retirement goal is by 2030:

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Annual dividend income goal: $150,000.

Value of IRAs needed: >$4,000,000.

I better get to work!

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10 Responses to Dividend Income Goals

  1. kdenhoser says:

    that concert sounded really good did you get to see them on the tv special the other day??
    good but not as great as that concert sounded…..
    the divine dividender

  2. Nice goal, But 150K in yearly income is pretty high. Do you really need that much income by 2030?

    • Needs are one thing and wants are another. I want to go all over the world and bring my family with me. I would love to eventually be able to enjoy my kids and their kids and do anything and everything they might want to do. I know money can’t buy happiness, but a week at Disney for 10-12 people in 2030 might cost $20-30k or more. Seems like a fair amount for about 40 years of investing and waiting. I may never get close to that, but I sure do expect to try. I started out with the goal of $70,000 to retire at 38 when I was17 and that has only about doubled since then for me to retire at 62, so I think that is not quite a huge increase based on the time in the market from age 38 to 62. If I live that long, I plan on spending some money and enjoying the fruits of my labor. Good luck.

      Keep cranking,

      Robert the DividendDreamer

  3. Love the ambition.

    You said $70,000 is potentially in sight. Where are you today and when do you think you will get to $70,000?

    Looking forward to checking back in periodically.

    Cheers!

    • A lot of it depends on the growth on the dividends. As far as the goal, the goals were based on me at 62 years old. That is about 15 years from now. If I double my dividends every 7 years or so, I would imagine the numbers would come in when I am 54 years old. I would love to double double the dividends by 62. I might be a little optimistic, but why not? In reality, it could possibly be a little better if I continue to add money to the pile. It could also come out a little worse than expected, but if I do not have goals, then I would just be rambling along. I feel the 150,000, is feasible if the stocks continue to pay and increase dividends.

      I read your post and I feel essentially the same. You have to have goals even if they are lofty. If you shoot at a target, eventually you will hit it. If you do not take the shot, you will never hit it. Good luck.

      Keep cranking,

      Robert the DividendDreamer

  4. Aiming to have an income of 150K per year out of dividens is a great goal. Is that to have a lot os security or is it because you are – not so frugal?

    My retirement goal is 2029 and based upon the save withdrawl rate, I need far less than the 4 Mio… Lets see how that evoilves over time…

    • I want to travel the world with my kids and maybe grandkids later in life. 150 sounds like a decent amount. However, things will coat more in years to come and that 150 will buy far less than it can today. Being frugal is great, but I hope to be able to spend a little bit as I get older. My main goals are traveling the world, so that is going to cost a pretty penny. Who knows? I may never reach my goals, but I have them laid out. At this point, I am working on reaching intermediates and eventually the end result.

      Thanks for stopping by. Good luck.

      Keep cranking,

      Robert the DividendDreamer
      AKA — Seeking Dividends

      Follow me on Twitter– Seeking Dividends@DividendDreamer

  5. WOW!!!! Great goal. May I know how much additional money are you putting into your portfolio each month?? I recently just started my dividend growth portfolio and my blog. It’s not doing that well now since the overall market is down. However I am using this opportunity to purchase more dividend growth stocks. Please check out my blog at http://www.dividendgrowthbunny.com

    • I currently put about 1600/month on average. With the cost of living a normal life, not much is left over.

      Keep cranking,

      Robert the DividendDreamer
      AKA — Seeking Dividends

      Follow me on Twitter– Seeking Dividends@DividendDreamer

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