12-12-2021, 08:00 AM
Two very different numbers to compare.
First is of course the total amount of dividends. The ultimate goal for many of course is to grow this, the issue is that it's not a very effective comparison as it gets automatically distorted if you are adding new money or even just reinvesting dividends. Obviously still a good statistic to look at.
I like to look at "organic dividend growth", I do not know if this is a real term or not. But basically just checking the amount of dividend growth purely based on dividend raises. This metric is more handy for seeing what level of income growth you can expect when you, at some point, actually start pulling the dividends out on a monthly/quarterly basis. Over the long term this number needs to be higher than the inflation numbers if you wish that your purchasing power keeps up (or even grows) during your retirement days.
I haven't calculated either for myself (for 2021) yet. I'll get to that in January or something.
First is of course the total amount of dividends. The ultimate goal for many of course is to grow this, the issue is that it's not a very effective comparison as it gets automatically distorted if you are adding new money or even just reinvesting dividends. Obviously still a good statistic to look at.
I like to look at "organic dividend growth", I do not know if this is a real term or not. But basically just checking the amount of dividend growth purely based on dividend raises. This metric is more handy for seeing what level of income growth you can expect when you, at some point, actually start pulling the dividends out on a monthly/quarterly basis. Over the long term this number needs to be higher than the inflation numbers if you wish that your purchasing power keeps up (or even grows) during your retirement days.
I haven't calculated either for myself (for 2021) yet. I'll get to that in January or something.