I normally don’t make, keep or write new years resolutions, but in the spirit of starting this blog to share financial tips about income through dividends, better saving and better investing, I’m doing things a little differently this year. I’m committing myself to trying to achieve $50k per year in passive income through dividends on this day, in 5 years time. That’s January 1st, 2018.
But that’s not really a 2013 new years financial resolution I hear you say! . That’s 5 years away. While that’s true, it means a bunch of sacrifices for us for 2013 and over all the years through to 2018.
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The $25k yearly dividend income that we are lucky enough to receive each year now needs to be fully reinvested back into additional dividend paying stocks if we have any hope of acheving this. The accelerated mortgage repayments that we have been making, some of the additional perks like the overseas trips etc need to either be put on hold or funded by some other means if we want to acheive this.
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Before putting this down to print, I had to ask myself, is the additional sacrifice really worth it? After having saved and scrimped to get to where we are and enjoy the fruits of what’s that delivered, why go backwards and need to push hard once again. The answer frankly was pretty straightforward.
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While I think that $25k per year in dividend income is a nice cushion, if I had to be honest, it’s not financial independence (at least not for us in our current situation). $50k per year in passive dividend income, rising each year with dividend increases? Now that’s a different story. In terms of being able to meet essential living expenses, I think $50k per year will go a long way.
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$50k/yr doesn’t necessarily mean retirement to me. I think it certainly means flexibility in not needing to think twice about work based simply on what a job pays, and being able to chase down certain things that I might have had to think twice about previously given financial considerations.
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In the spirit of showing progress toward this goal, ill also be documenting my dividend progress on a regular basis (probably quarterly) as the year unfolds and over the successive years through to 1 Jan 2018.
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Happy new year to all of you and best wishes in achieving your goals (financial and otherwise) in 2013!.
[...] growing a passive dividend income stream of $25k/yr and also document my goal to try and get to $50k/yr in passive dividend income by January 1, 2018. I hope it helps folks that are new to managing their money fast track their own [...]