💸 $500K = Work Optional?
Today is Dividend Day.
The series where I teach you 5 things about dividend investing in less than 5 minutes.
1️⃣ $50,000 Per Year in Passive Income
Want $50,000 a year without working?
The chart shows how much you’d need to invest in big companies like Coca-Cola, Microsoft, or McDonald’s to live off passive income.
The higher the yield of the company, the less principal you need.
2️⃣ 26 Passive Income Ideas
There are tons of passive income ideas - real estate, eBooks, YouTube, even vending machines.
But for me, dividend growth investing is the most reliable (and my favorite).
3️⃣ An Investing Quote
Dividends are Kevin O’Leary’s favorite passive income stream too.
He’s a famous investor from Shark Tank who built a mutual fund company around this exact idea.
His rule? If it doesn’t pay a dividend, he won’t buy it.
“I do not own a single security anywhere that doesn’t pay a dividend, and I formed a mutual fund company with that very simple philosophy.”
-Kevin O’Leary
4️⃣ You Can Live Off of $500,000.
Speaking of O’Leary, he says you can live off of $500,000 in principle and do nothing else to make money.
It’s all about controlling your lifestyle, and taking the right amount of risk for you.
Click the image to see the clip:
5️⃣ Example of a Dividend Stock
OUSA is the O’Shares U.S. Quality Dividend ETF.
It includes large and mid cap U.S. companies selected for quality, low volatility and dividend growth.
The top holding? Microsoft.
Microsoft makes software and cloud tools that people and businesses use every day.
Microsoft makes money by selling Windows, Office, and cloud services like Azure, while also earning from ads, gaming, and subscriptions.
- Profit Margin: 36.1%
- Forward P/E: 32.9x
- Dividend Yield: 0.6%
- Payout Ratio: 24.2%
That’s it for today!
Thanks for reading Compounding Dividends! This post is public so feel free to share it.
Used sources
- Interactive Brokers: Portfolio data and executing all transactions
- Fiscal.ai: Financial data