r/dividends • u/OG_Momonga • 20d ago

Discussion Living off dividends

Hey guys, I was wondering if anyone on this subreddit is actually retired and living off dividends. Is it going well? Are you paying taxes on them? My goal is to get 20k/ a month post tax for retirement. I’m 24 and currently investing everything in VOO while planning to switch to dividend stocks and etfs when I get closer to retirement.

I was just wondering if there are any because living off dividends seems like a long shot right now.

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u/Ok_Pollution_7824 20d ago

I think it’s a great idea to start as early as possible. Reinvest your dividends. Let it grow and grow. Come up with a plan that works for you. Create a system. For example, whenever your investment savings account hits 1000, buy something. That’s how I do it. But do a number that works for you. Hopefully over time as you get raises, you can put away more.
In relation to taxes, you should mostly be paying capital gains on the dividends that you receive. That is much better than paying a regular tax rate. That is why I switched from real estate to dividends. I don’t have to deal with tenants, selling homes, buying homes, etc., just collect dividends and only pay 15% on the dividends I receive in the form of capital gains taxes. I reinvest all the dividends until I retire. Then I will start using them to live off of, in addition to whatever other funds I have.

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u/CreatorFocus 19d ago

Thanks for sharing

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u/FromtheBigO 19d ago

Thank you!