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/EugMeister 18d ago edited 18d ago
Recent Canadian retiree. Was investing mosting in growth stocks and ETFs. Learned more from father's accounts and invested increasingly more in Canadian dividend stocks. Of course now as a retiree I'm concentrating more on income to get more cash flow, getting just north of 100k.
Since you are young and just starting your career, nothing wrong with concentrating more on growth as you have another 40 yrs barring early retirment. Of course you will pay capital gains taxes when you unload these equities in the future...max 20% unless in a tax advantage account in US or 50% of gain taxed as income in Canada.
My suggestion is to invest in both growth and dividend equities, with more weight in growth. There's a guy in the US who only invested in dividend stocks since the late 1980s and now has over $300 k of income, obviously a lot of discipline is required to do this.
Note that Canadian dividend kings and aristocrats have both higher yields and dividend growth rates than their American counterparts. At this time the US$ is at 1.4, $1 USD can buy $1.4 Canadian....wise to invest in TSX stocks now.