My Dividend Earnings

Any investor worth their salt has dividend stocks amongst their investments. Unfortunately I am an extremely cautious investor and I have not explored this area fully yet. I always get confused whether I want a stock with a good dividend yield or one with potential growth or both. I think I need to focus more on established companies with a good dividend record.

I currently have two dividend stocks, Royal Mail Group and National Grid and am in the hunt for more. My dividend stocks are in my stocks and shares ISA which means I do not have to pay tax on dividends. I do not withdraw my dividend income, instead I prefer to reinvest it in more shares. I think this is a good strategy with Royal Mail because right now there does not seem to be much growth with the company. I am still waiting for my first payment from National Grid. I will hopefully pick up more FTSE 100 dividend stocks very soon.

Current holdings are Royal Mail 237 shares, National Grid 96 shares.

2014 Dividend Income

Royal Mail £45.87

3 comments:

  1. Hi Laura,

    Just a quick comment - notional tax on share dividends is already accounted for before receipt so, for the basic rate tax payer, it will make no difference whether in an ISA or not.

    Good luck with the search for more dividend shares - I guess the recent marke surge makes them a little less attractive?

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  2. Small portfolio of dividend payers. I think over the long term you will see the effects of building an exclusive dividend growth portfolio as you develop your own ever increasing passive income stream. While capital appreciation is nice when holding a stock, the only way to benefit from it is by selling it. With a dividend stock you are free to spend your dividend without touching your share ownership. You know the saying, "Spend the interest not the principal." It can be applied to dividend stocks. Spend the dividends not the shares.

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  3. Hi Laura

    Dividend paying shares are a fantastic way to start in your investing. The great thing about them is that even if the share price falls, the dividend generally carries on increasing. Once you have a diversified portfolio it is possible to stand a cut from a minority of the companies as this may be offset by the remaining companies.

    It's great to see someone right at the beginning of their journey, and look forward to following your progress.

    Best Wishes
    FIUK

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