Many people have different investment methods and strategies. There’s no one size fits all! The strategy that works for us (and when I say “us” I mean me since my wife trusts me to take care of finances) is focusing on high quality dividend growth stocks. For the most part, I look at companies that have been steadily increasing their dividends for years because it shows stability and gives me confidence that the companies have enough cash to pay out their dividends. I have 17 holdings at the moment and am always looking to increase the number of holdings as well as the amount in each company. My portfolio is only 3 months old, and this is just what I have so far.
These are the companies that I’m currently invested in:
$ABBV – Abbvie Inc.
$BEN – Franklin Resources Inc.
$CSCO – Cisco Systems Inc.
$CWEN – Clearway Energy Inc.
$DUK – Duke Energy Corporation
$IRT – Independence Realty Trust Inc.
$KO – Coca-Cola Company
$LYB – Lyondell Based Industries
$MAIN – Main Street Capital Corporation
$MO – Altria Group
$O – Realty Income Corporation
$PFE – Pfizer Inc.
$SO – Southern Company
$STX – Seagate Technology PLC
$T – AT&T Inc.
$VZ -Verizon Communications Inc.
$WTRG – Essential Utilities Inc.
My sector breakdown is:
Healthcare – 12.2%
Information Technology – 12.0%
Utilities – 22.2%
Real Estate – 12.7%
Consumer Staples – 12.4%
Materials – 4.7%
Financials – 11.3%
Communication Services – 12.4%
With my current breakdown, my highest value sector is Utilities and that’s because I’ve found that the Utilities dividends tend to be very safe and consistent even though they have lower yields, which is fine with me. My Materials sector isn’t too high because I just have one company that deals in Materials. This is because I just haven’t found any Materials companies that have looked attractive to me yet. Again, I have criteria that needs to be met before I invest in a company.
At the moment, I have roughly $500 in each company and I contribute $1,000 every month to the portfolio. My strict rule is that I DO NOT SELL! I buy shares in these companies when there is either a dip, or an ex-dividend date coming up so I can get additional dividends. I’m currently projected to receive $409 every year in dividends from the $8,200 portfolio I currently have which means my yield is just under 5%. I know for many of the dividend investors out there, this yield might be on the higher side, but I’m looking to get into more high quality dividend stocks in the future which have lower yields, but more stability.
Again, this is just a basic level summary of my portfolio and in upcoming posts, I’ll speak on each of these and highlight why I am invested in each of them. I don’t just randomly pick companies, there is a method to the madness, I swear!
The goal for my portfolio is to be able to get enough dividends coming in every year to be able to cover the expenses that my wife and I currently have like our mortgage, utilities, and food costs. After doing the math, we would need $26,400 in yearly dividends in order to reach this goal and although I’m new to the journey, I’m excited to share the path we are taking with everyone who reads this blog. I’ll be learning a lot along the way and I look forward to sharing what I learn with all of you!
I’m going to end the post there so I hope you enjoy reading about my portfolio and I’ll catch you on the next one!
Marcus