09-08-2015, 11:31 PM
(This post was last modified: 09-08-2015, 11:34 PM by Dividendsrule.)
For me the problem is always the lost decade of 2000-2010. If I relied on capital appreciation strategies and needed to retire around that time, I'd be in a tough spot. I did some hunting around to try to replicate your 3 funds above.
From 1/2000-1/2010, IWF returned -4.6% annually, dividend reinvestment included.
FRESX, a Fidelity REIT fund, did better, returning 9.6% per annually.
Finally, VDIGX, a Vanguard dividend growth mutual fund, returned 2.1% annually in that time frame (see low-risk-investing.com).
That is an average portfolio appreciation of 2.36% per year.
Also, VNQ cut their dividend 5 times in the past decade. I will list their distributions according to dividend-stocks.com from 2005 and onward: 3.56, 3.25, 3.11, 3, 1.96, 1.89, 2.05, 2.34., 2.79, to 2.92 in 2014.
8% of VNQ is Simon Property Group, which cut their dividend by 51% in 2009. 3.89% of VNQ is EQR, which cut their distribution in 2009, and again in 2010. VNO, 2.36% of VNQ, is littered with dividend cuts in the past decade.
So if we have some years of flat equity growth ahead of us, I would question the viability of "systematically milking for income" any equity class. It is precisely then that i would treasure my individual Coca Cola, Procter and Gamble, WPC, O and the like, because they have proven to me through thick and thin, recession and depression, that they can keep paying me rising dividends without cutting my income, typically regardless of how the stock price performs.
Some companies' dividends have been historically quite predictable. Asset values are not predictable year to year.
From 1/2000-1/2010, IWF returned -4.6% annually, dividend reinvestment included.
FRESX, a Fidelity REIT fund, did better, returning 9.6% per annually.
Finally, VDIGX, a Vanguard dividend growth mutual fund, returned 2.1% annually in that time frame (see low-risk-investing.com).
That is an average portfolio appreciation of 2.36% per year.
Also, VNQ cut their dividend 5 times in the past decade. I will list their distributions according to dividend-stocks.com from 2005 and onward: 3.56, 3.25, 3.11, 3, 1.96, 1.89, 2.05, 2.34., 2.79, to 2.92 in 2014.
8% of VNQ is Simon Property Group, which cut their dividend by 51% in 2009. 3.89% of VNQ is EQR, which cut their distribution in 2009, and again in 2010. VNO, 2.36% of VNQ, is littered with dividend cuts in the past decade.
So if we have some years of flat equity growth ahead of us, I would question the viability of "systematically milking for income" any equity class. It is precisely then that i would treasure my individual Coca Cola, Procter and Gamble, WPC, O and the like, because they have proven to me through thick and thin, recession and depression, that they can keep paying me rising dividends without cutting my income, typically regardless of how the stock price performs.
Some companies' dividends have been historically quite predictable. Asset values are not predictable year to year.