Monthly Dividend Income

space grey ipad air with graph on brown wooden table

I’ve been interested in making money with dividends for a while (in a casual way), but I didn’t really look into the details until recently. I had an idea that by buying stocks that have a good dividend payout, I could receive a monthly income was intriguing. This does work but the drawback is that you have to watch the stocks that pay dividends because the dividend yield can go down. It all depends on the company.

Unfortunately, the more money that you can invest, the more you can make. I have received dividends but my investments are so small that they are not worth claiming and I just reinvest the dividends back into the account. The reason that I have small account is that I am very risk averse, so it is my own fault. I bought some stocks in a Canadian company a few months ago, while they were cheap. The price per share has increased 102% since I bought the stocks. I had an instinct that the value would rise significantly but I didn’t invest enough money. If I was 100% certain (and less risk averse) I would have been willing to borrow as large a sum of money as I could, used it all to buy stocks in the company, sold them today and doubled my money in a matter of months.

The news being circulated in the mainstream news outlets regarding stocks and shares is not always accurate and could lead a person to make bad decisions. It is better to research this subject in a more detailed way with information coming from less mainstream personalities.

The way to generate dividend income is by building a portfolio of high yield dividend stocks that pay out at different times throughout the year, ideally getting a worthwhile income every month. The stocks that you pick should also have a history of raising their dividends regularly. To get a worthwhile monthly check would require a substantial investment. I saw one plan that claimed to return $1000 per month, throughout the year but it required a $50,000 investment and if that accounts for your total savings, then I expect that you would be too risky for most people. According to a 2018 GOBankingRates survey, 58% of Americans had less than $1000 in their savings accounts.

The basic idea of dividend income is sound and you can always start the process in a small way and reinvest the dividends that you receive. It will be a learning experience.

Don’t Have All Of Your Eggs In One Basket

brown bird nest

 

Most of us have heard this idiom before but many people still rely on one place to supply all of their income. Doing this is a most dangerous example of putting all of your eggs in one basket.  Many of us are now aware that the conventions of the 1950’s and 1960’s don’t apply to the world of work anymore. Most employers will get rid of an employee for any reason that they deem advantageous, even the most loyal and hard-working of employees are subject to this, especially in the so-called “Right to work” states. The phrase “Right to work” sounds so great, insinuating that this law is about worker’s rights when in fact it is a union busting tactic and allows employers to dispense with an employee at will. The employee therefore should feel that he/she has the right to dispense with the employer’s employment at will, although you will not find this prominently displayed in any workplace.

Every person needs to evaluate their financial circumstances at regular intervals, which brings up another common phrase, that of saving for a rainy day. Everyone should save money from their income, even if it is only a couple of dollars a month. The act of saving will get you into the habit and hopefully the savings will dramatically increase as earnings increase.

Acting now to diversify your income will save you the potentially devastating consequences of losing your one job, that pays all of your bills, that puts food on the table and a roof over your head. I can think of several ways to take some of those eggs and put them into different baskets. One great way is to complete some contract work online. The work is not permanent and you need to work with multiple websites to ensure that cash keeps rolling in, If nothing else it may supply the money for a savings plan and if you keep at it, the jobs get more interesting and the pay can increase. Working “gigs” on websites like Fiverr is along similar lines, except for the fact that you are using your particular skills such as typing, internet marketing, graphic design etc. Both of these ideas have the potential to generate a full-time income and even a business. I have more information on my “Generating Money” page.

Part time work, after completing your full-time job puts another egg into another basket for you, if you have the energy. Some are well paid, it all depends on your skill set. In theory, this is a great way to diversify your income, the problem is that it is time-consuming and potentially very hard, but it is an option.

Starting your own business is a dream for many people. To be your own boss and reap the full rewards for your efforts is a wonderful and motivating goal. A business can be started while you still have a full-time job, this makes the transition into self employment a whole lot easier. The general advice for starting your own business is to pick the thing that you love to do and go for it. Failing that, use your individual skills to generate money for yourself.

The goal is to have multiple baskets, each containing one egg. Each basket represents an independent source of income. The dream of course is to receive passive income, the basket that holds the golden egg.  This is income that generates an inflow of cash month after month without a need for any labor. It requires an initial effort, but after that, you are enjoying another independent income stream, labor free.  Royalties from artistic works, affiliate marketing and pensions fit into this category.

This is a large topic and it is of particular interest to me. I will write much more about this area of interest frequently and give you insights into my experiences. My goal is to produce a comprehensive list of reliable leads for you in the near future, especially in the area of working online.

Until next time, take care and invest wisely.