Those who invest in dividend paying stocks earn an easy residual income every quarter. And building up a huge pile of dividend stocks can earn a hefty amount of income with a relatively lower risk investment.
Be wary of those companies that say they have a 7% ROI payout. Remember, the higher the reward, then the higher the risk. A good percentage to look for would be around 3% – 4%.
I would buy dividend stocks from companies who are strong and mature with a long history. Companies that aren’t very likely to submerge. This way you can sleep a little better earning easy residual income.
A good resource to start with would be checking out the popular Dividend ETFs and seeing what companies are heavily buying or holding. I did this with VDIGX when I was looking to build my own personal dividend portfolio.
Of course you can also simply purchase the ETF if you don’t want to go through the hassle of research and single stock picking.
But these mature companies I’m talking about are companies such as Coca-Cola, Kraft, Johnson & Johnson, etc. Many successful investors like Warren Buffett invest in these industry giants because of the long-term good standing and decent dividend payouts.
Dividends are generally paid out every quarter. Each company has their own payout schedule with an ex-dividend date. Because of this, it’s possible to create a ladder of dividend payments so the schedule allows you to earn easy residual income.
Earning Easy Residual Income with Strong Dividend Companies
If you do your research on dividend paying companies, you’ll be able to choose and pick your own companies such that you receive a dividend payment every month.
Below is a sample schedule of company payouts I have listed so that I earn income every month from dividends:
Cisco Systems (CSCO)
CVS Caremark (CVS)
Pepsi Co (PEP)
Breaking Down the Monthly Dividend Distributions
Breaking down the list of companies above, this shows you what companies are paying you each month. Because these are all strong mature giants in the industry, there’s lower risk investing in them. With that in mind, you can expect a to earn easy residual income every month.
January, April, July, October
February, May, August, November
March, June, September, December
Looking at the this above, this is just a sample of many of the large companies out there.
In other words, you could mix and match the stocks above as well as adding in companies that you prefer. Above all, as long as you own some shares in each dividend cycle, you can expect an easy residual income paycheck every month.
The more shares you own, the more the payout. With a portfolio of $50,000 in dividend stocks, you can expect $1,000 – $2,000 payout every year, for doing nothing!
Additionally, there are companies out there that already pay monthly dividends:
Your portfolio is not just limited to one type of stock. Many REITs also pay a hefty dividend because they earn a tax benefit by doing so. For example, O listed above, is one of the strongest monthly paying dividend stock in the REIT sector. In conclusion, be sure to always do your research and mix and match to keep your portfolio diversified.
2 thoughts on “Easy Residual Income with Dividend Stocks”
Great post! Thank you for the advice!