The first time I saw a dividend payment appear in my account I was in high school. I thought that I found the secret of life. I had a vision of doing whatever I wanted all day as dividends paid my expenses. It turns out it takes a little longer to do that than I thought at the time.

I am not the only one that likes dividends. John D. Rockefeller who may have been the richest man in history said, “Do you know the only thing that gives me pleasure? It’s to see my dividends coming in.” And they say money can’t buy happiness.

Generating passive income has a strong hold on the investor imagination. Passive income is earning money that takes little to no effort to acquire. Passive income can be used to fully or partially replace non-passive income (a salary) and may provide an opportunity to mitigate the risk that stems from the volatility of asset values. 

I recently wrote an article on generating $100,000 in passive income. As part of that effort, I created a spreadsheet that investors can use to project dividend income using several assumptions including savings levels, dividends yields, dividend reinvestment and dividend growth. Different tax rates can be added to the spreadsheet to account for the differences in marginal rates or investing in the super environment. 

Give it a try to see how you can grow your passive income. There are instructions in the spreadsheet which can be read by hovering over relevant cells and the blue cells can be updated based on your personal circumstances. You can read more about the spreadsheet in my article Generating $100,000 in passive income.

Morningstar passive income projection tool 

Any questions email me at [email protected]

Income investing resources

How to build an income portfolio

Investors love dividends but creating an income stream involves more than just picking the highest yielding shares.

Why I am an income investor

The critiques of dividend investing don’t hold up to scrutiny.

The tax code is signalling how to build wealth

Not all income is built equal and it's important to understand the difference sooner rather than later.

4 income investing mistakes

Avoiding these mistakes will increase your chances of success as an income investor. 

Can you retire on dividends?

Living off of investment income addresses key risks faced by retirees. However, it introduces several considerations for investors who pursue this strategy. 

Building a dividend portfolio with ETFs

Chasing yield is very similar to chasing performance. It can lead to poor outcomes if you don’t do your homework.

Is this the best metric for income investors?

A metric that can improve your results as an income investor.

 

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