Yields to get a portfolio off the ground

March toward $1,000,000: Week 1 (July 30 – Aug. 3)

Purchases from July 30-August 3 (2018)

Purchases from July 30-August 3 (2018)

I know it’s been just under a month since my Debt: the elephant in the room post, but that 27-day stretch seemed like one of the longest of my life.

Honestly, I simply did what I had to do. I sold my entire portfolio to pay down debt and get my financial house in order. It was the right choice, no doubt about it, but boy did I have a hard time adjusting. I mean, I was marching my way to $1,000,000 … literally taking daily steps. When I didn’t have those steps to take, I guess I kind of didn’t know what to do.

I never quite got used to it. Fortunately, though, I don’t have to worry about that anymore. I’m officially back in stride, marching once again.

This week’s purchases

With a portfolio worth exactly $0.00, I got back to the grind on August 1. I figured it was as good a time to start as any. I spent the day, and each of the next two, opening and adding to positions in AT&T (T), Cardinal Health (CAH) and Ford (F).

Why those stocks? I’m glad you asked.

For starters, the payout schedules. CAH pays quarterly dividends in January, April, July and October, T pays in February, May, August and November and F pays in March, June, September and December. Translation: starting in the next month or so, I’ll be earning a dividend each and every month.

Beyond that, I like the combination of yield and value. I want my portfolio to start spitting out cash in a hurry, so I picked three stocks I know will deliver in that respect. CAH has a solid yield of 3.81%, F is sitting at 6.05% as of this post and T offers a ridiculous 6.28% yield. On top of that, all three have price-to-earnings ratios under 10 and are scraping up against their respective 52-week lows.

We’ll see what happens. I like the purchases I made and, at least for awhile, may just keep rolling with the trio until I have a decent amount of shares piled up. Sitting here now, several hours after the market closed for the week, I own three shares of CAH, six shares of T and 10 shares of F. It all adds up to a portfolio worth $448.69. I picked up the shares of T at an average cost of $31.91, the shares of CAH at $50.30 and the shares of F at $9.96.

The shares will earn me a combined $23.73 over the course of the next year and, as those of you who followed my initial march know, that number will only go up. Previously, I made an attempt to add value to my portfolio, whether through a dividend payment, purchase or deposit, each an every day the market was open. This time around, though, I think I’m going to take a bit of a different approach … I’m going to start with the goal of adding at least $1 of forward annual income every day the market is open. In other words, I’m going to buy a stock a day (at least).

I’m pretty sure I can make it happen. After that, the plan will be to grow my forward annual dividend income by $2 a day, then $3. I’m going to need to count on the power of compound interest to go any higher than that. That’s what dividend investing is all about, though, right? The daily goal will grow as the dividends do.

Well, that was fun. I feel better now that my first post back is out of the way. Thanks for being patient with me … and thanks for following along.

March on!

Leave a Reply

%d bloggers like this: