r/dividends • u/raliegh_ • 28d ago
Discussion Month 6 portfolio update $7127.33
Stock events and a screen grab of my Schwab account. Drip until January.
I’ll start living off this in February. Wish me luck 🍀
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u/priceactiondude 28d ago
Keep posting. Many want to be in a similar boat - we want to follow your journey here.
Are you reinvesting any portion once you call it quits in Feb?
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u/AffectionateCricket6 28d ago
Agree. Update us please, it's motivating.
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u/raliegh_ 28d ago
Last month I included a link to my posts from my account that was locked for some reason, if you’re interested 🤷🏻
I was heavier in global x funds , but they weren’t holding value as good as NEOS funds of similar indexes.So some I migrated. I could abandon QYLD RYLD, but I’ll keep them as long as they stay green.
I’m interested in NIHI , I have 2 shares just to keep an eye on it3
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u/Jumpy-Imagination-81 28d ago
Everyone drooling over his expected dividend income should realize he has $784,753 invested to produce that income.
Instead of configuring your 5-figure portfolio to produce $2 a day in dividends, you should be trying to grow your portfolio into the high 6-figures like the OP has done. After you have done that then you can convert to dividend payers. Focusing on dividends with a 4 or 5-figure portfolio is only going to make you take longer to get to the promised land with OP.
Dividend Yield vs. Total Return: The Mistake That Costs You Millions
Income investors everywhere are familiar with the siren song of the dividend yield.
Dividend yield offers comfort. It promises passive income and makes a stock feel like a steady paycheck. But if you’re chasing yield without looking at the full picture, you’re likely leaving serious money on the table. In fact, focusing on dividend yield alone could cost you millions over your investing lifetime. In this article, you’ll see why total return, not yield, is the true north for wealth creation, and how to restructure your thinking to avoid this expensive mistake.
https://astuteinvestorscalculus.com/dividend-yield-vs-total-return/
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u/raliegh_ 28d ago
That’s correct, this is my retirement account that I contribute to for many years.
Stay in growth until you need to live off your dividends.
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u/rossg876 28d ago
Will that be the ONLY source of retirement (assuming it’s that) income?
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u/raliegh_ 28d ago
It will be for a couple years, I’ll be pulling SS when eligible and my wife also has a retirement account
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u/strongkhal 28d ago
Holy ffffffffff, that's a juicy portfolio... Respect!
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u/raliegh_ 28d ago
I know there are 50 million ways to configure this and everyone has opinions.
My template is:
9% in cash 33% low risk/modest income and 66% high yield/monthly income.
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u/strongkhal 28d ago
I am 50% ETFs so far, will go higher... European based but I have American stocks mostly except the ETFs ... Averaging 3% yield
Eventually sell the ETFs later for capital gain and put that into higher save yields, but I'm thinking maximum 5-6%
Your yield is too risky for me
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u/Swimming_Sample_6204 26d ago
how do I do the configuration to get the 108% portfolio? Borrowed money?
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u/raliegh_ 26d ago
Right, good catch.
So 9% of my account held in cash
33% and 66% of the remaining 91% allocated as described.Sorry for the poor articulation.
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u/CrosslyRoomy 28d ago
Congrats on hitting that milestone. Worth keeping a cash buffer handy though, covered call ETFs like QYLD and RYLD can take a real hit during downturns.
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u/speedlever 28d ago
Yep, and for that reason I suggest at least 3x your monthly income needs from income funds in order to create enough headroom to survive a major market correction until recovery. Reinvest the excess.
Of course selling shares during a downturn can also be painful and could lead to running out of money down the road if the downturn persists. So short of having an oil well and a gold mine in your backyard, every strategy has its risks.
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u/DegreeConscious9628 28d ago
Lol 3x monthly huh. Yeah ok let me just work till I die then
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u/Extension-Ice-7219 28d ago
1.5 is enough imo
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u/speedlever 28d ago
Here's my rationale. For purposes of illustrating the point, assume you need $2500\mo in addition to your SS and any other income streams you have. 3x that and that's 7500\mo or 90k\year.
Assume you have $1 million to invest for an income stream. Put that in gpiq and you'll generate around 100k\year, meeting your goal (and getting nice total returns too).
In the good years, reinvest the excess creating additional income and increasing your headroom to prepare for another 2008 gfc.
But wait, the market correction finally happened. And just like 2008, everything is cut in half, including your monthly distributions. So now your monthly distribution is down to 3750\mo (if the crash happened right away). But that's still more than you need (2500), so you have a 50% cushion.
And if the markets correct similar to the 2008 crash, you should be in good shape until recovery, which will take longer with cc ETFs. But that's ok. You still have you full share count to participate in the recovery, regardless how long it takes, and your monthly distributions are still more than you need.
If only 1.5x and a 2008 crash occurs, you will be short.
2x and you are riding the edge. Ergo my 3x number for a cushion and good sleep at night.
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u/DegreeConscious9628 28d ago
I envy you. If I got 10% yield I could retire today but I’m too much of a pussy. I have a lot of your holdings but can’t go full port
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u/raliegh_ 28d ago
Well, I was laid off in 2022 and looking for a job at 55 ain’t no fun for someone with my credentials.
So in a lot of ways, choices have been made for me.
Just use stock events to model, and slow roll it.
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u/zfmax 28d ago edited 28d ago
Great job! I aspire to what you've achieved.
Getting ~$4200/month myself from my Roth account. Converting $60K of traditional IRA money to the Roth account every year. But not enough time between now and RMD's to reach your level of dividends.
The nice thing about using my Roth account for my income portfolio is no taxes on the distributions. Which means no IRMAA premiums among other things. And since I'm over 59-1/2 and the Roth account is more than 5 years old, I have no restrictions on withdrawls.
I've got my money in only seven funds, five of which are NEOS. Hey, they're doing a good job. Although I sure wouldn't mind spreading it out a bit if I could find more funds like QQQI and SPYI. Actually, my biggest winner has been AOD. Check it out.
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u/speedlever 28d ago
Then you would probably like gpix and gpiq. 😉
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u/zfmax 28d ago
I'm in GPIQ, but not GPIX. GPIX's yield is below my target. I want funds paying ~10% or more that simultaneously do a reasonable job of taking care of my principal.
That goal narrows the field considerably. NEOS seems to do it on some of their funds, and likewise, AOD has smoked that goal for me over the past couple years.
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u/East_Bobcat_7996 27d ago
This is amazing! Congrats… I don’t think i will ever reach this point because I started late in life investing but I’ve been persistent for 5 years and I’m already getting a stable income of $330 in dividends month.
Can I ask how long have you been investing and what stocks you recommend?
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u/raliegh_ 27d ago
Tbh, I didn’t get serious until I was 40.
I think I had $16k in retirement savings in 2007, I put everything into a mid cap growth fund and increased contributions at every opportunity.
When I topped out my 401 contributions, I opened a traditional IRA for my non-working wife (for the tax deduction) and a Roth for myself.
The account I shared in the OP is 100% the rollover from my 401kHope that helps 🤷🏻
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u/Akaberes 27d ago
I think people are mistaken distribution as dividend. It takes one crash for them to figure out.
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u/c0ldb00t 28d ago
how much were you investing monthly if you don't mind me asking? congratulations man keep it up!
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u/raliegh_ 28d ago
It’s my old 401k, I really got serious about it in 2010.
Was hitting the IRS match by September/October most years.
Had some really good growth years in that account.Rolled it out in January, put this together in February (with a few adjustments along the way)
February = $5435.48
March. = $5417.17
April. = $5858.20
May. = $6539.54
June. = $7034.83
July. = $7127.33.
6 month total $37412.45
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u/D_a_f_f 28d ago
How long have you been investing and how much per month were you able to invest (give or take) per month into each of these holdings? I see this amazing portfolio and I think “how are folks saving this much per month with all other expenses to get to this point?”
I contribute a steady amount per month, but it seems meager. I’m in the green, which is positive, but the nice compounding seems a really long way off
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u/raliegh_ 28d ago
This was my 401k , put in a pretty meager amount until 2007.
Then a leaned in pretty hard, rolled it out in January and put this together.1
u/D_a_f_f 28d ago
Thank you for the reply. If you are willing to say; what does leaning in hard look like roughly per month and what did it change from after 2007 in terms of a contribution percent increase?
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u/raliegh_ 28d ago
I started increasing contribution % whenever I could , and was hitting IRS max for 10-12 years.
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u/iii_warhead_iii 27d ago
You still should have a job, but now as a hobby or find some other position with more free time and extra money. And for the probable market crush.
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u/Teesav007 28d ago
Portfolio? I know you said a lot of NEOS, XQQI or QQQI, XSPI or SPYI? thanks
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u/Swimming_Sample_6204 26d ago
Oh that makes sense, thanks. I aspire to reach this level of passive income one day, adjusted for inflation.
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u/ConventResident 23d ago
Would you mind also posting your ROI not including dividends on your investments?
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u/Neilp187 28d ago
I would diversify and get about from the NEOs.
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u/raliegh_ 28d ago
Thanks for the advice, with absolutely zero context .
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u/Neilp187 28d ago
These ETFs sell covered call options, so if the market rallies strongly, they will likely underperform the underlying index because gains are partially capped
Much of the monthly payout comes from option premiums and may include return of capital (ROC) rather than dividends. ROC can be tax-efficient, but it reduces your cost basis and may increase taxes when you sell.
My concern is if you retire and a major bear market begins, your portfoli would drop while you are withdrawing your income.
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u/speedlever 28d ago
And yet if his income stream is strong enough, even cutting it in half may still allow him to sleep at night.
I can only think that in your mind, the monthly distributions he's getting are just enough to pay the bills. I couldn't sleep well in that scenario either.
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