Life after dividents

– Hello F.I. in Romania, welcome to my show! How are you? How is life?
– Hello, thank you for having me. It’s great, I am on a small holiday with my family, clearing up my head with some fresh air.
– That’s nice to hear. Where are you now, if you don’t mind me asking?
– Well, we are at Băile Olănești, 200km away from our home town. It’s a small village with lots of natural streams with different curring properties.
– Oh, that must be interesting! But let’s head back to our topic for today. How is life after dividends? We saw your last post and we are really interested in what is the next step?
– Well, to confirm what you said, in the last two months the dividend I was expecting were paid off and they are in our pockets (already reinvested to be exact). Life didn’t change that much and there are lots of things to consider because there are different strategies that can be applied, from selling not performing stocks to a recalibration of the portfolio.
– Will you make a decision soon? Should we follow your progress?
– I am not sure if I will make a big decision regarding our portfolio, as energy companies are still my 1st priority in investing, also I am spending some time thinking about starting to invest in ETFs on a larger scale. But I think yes, it will definitely be worth it to follow our progress!

Hey guys, this is just a mock “interview” but I was thinking of how funny it could have been. But I am a small investor from a small economy, so this will not happen any time soon. But dream big and shoot high, haha.

Currently leaving the funny stuff aside, we did receive the dividends, exactly as much as we expected. But if we are considering the amount received it’s no were near a source of living. But how much do we need exactly to live off? Is it possible to live just from dividends? Or selling stocks is a must, for a boost of income, from time to time.

When we started the path we said we need around 2000USD per month to maintain our current living style. Of course, the idea is to have multiple incomes, not just the dividends, but for the purpose of exercising my math, let’s see how can we reach the 2000USD monthly just by dividents.

2000USD equals 24000USD per anum, considering that most companies pay dividends just one time a year. At a 10% return of dividends, we would need a portfolio of 240000USD. Not taking into consideration the annual growth of the companies we invest in and the annual investment money we have at the moment(2000USD), we will need around 120 years to build that portfolio, just to live from it. I have to work out more considering I am already in my 30s.

So here are the following solutions:

  • Later, when we will consider retiring, sell existing stocks for their future value. So investing in stocks is like keeping the money in a bank that pays a better interest ( and of course rebalancing the portfolio is a must because companies rise and fall)
  • Increase the amount of contributed money, but for this, I need a higher active income
  • Practice a guerilla war with ex-dividents dates and change stocks all the time to maximize the number of dividends we get each year.

My strategy was to hold on companies that I would invest in and still consider them a good investment in 10 years.

But strategies can change, right? I will take a look into rebalancing the portfolio to maximize the number of dividents we can receive, just for the fun of sketching a possible plan of action.

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But what I am interested at the moment is to invest in tourism Stocks. They took a great fall because of the pandemic, but sooner or later they will adapt and reopen. Of course, studying this domain will take some time, but as with electric companies I have a friend who knows more than me and can help.

What do you guys think? Is it good to invest in tourism and recreation stocks? What do you think about virtual tourism?

Thank you for taking the time to read this! You are awesome 👍!

Disclaimer: I am not a financial consultant! All the information you find here are my decision, I have taken at that moment, on my own analysis. I am open to any type of discussion about money. If you want to replicate my portfolio take into consideration that it is your money and you can have losses.

P.S. Photo source is from Unsplash

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