I owe a whole lot of gratitude to the Early Retirement and Dividend Growth Investing (DGI) community for exposing me to this truly remarkable methodology. I adopted this methodology in late 2011 and haven’t looked back. Once I created my own forecast models to calculate how much my future self could earn, I was hooked, and nothing else has changed my perspective to date. My mission is crystal clear, and I guess my ability to teach some of my family members was decent enough to earn their trust and buy-in. After laying out a dividend forecast, and modeling a proposed ownership portfolio for my parents, by the end of 2013, I earned their trust and they literally handed me the key (aka account login/password) and authorized me to proceed with the construction of their retirement portfolio via a rollover IRA.
They have been so impressed with the results and my ability to educate them on this process, they have agreed to let me share the progress of their portfolio alongside mine. This is such a wonderful insight to the DGI community, quite simply because it’s an idle portfolio, meaning new contributions are not being added (with the exception of an unforeseen cash in-lieu of pension payments received in 2016 from a previous employer). This portfolio is large enough to accelerate at a nice pace. This idle portfolio, is truly a rapidly growing dividend income machine! Essentially, this idle portfolio, will become a living breathing case study for the InvestorPeek community to follow. I hope this transparency will help expose and educate on the true nature of the compounding effect. As time goes by, I urge you to pay close attention to the two components at work 1) dividend reinvestment, and 2) dividend growth. The dividend reinvestment provides more shares, such that the new shares payout their own dividends, and the growth of the dividend accelerates the compounding effect. What is more apparent with a larger portfolio, that is sometimes missed with a small portfolio, is the remarkable nature of the reinvestment. Once that dividends become large enough, its essentially similar to a 401k “company” match!
My Parents Million Dollar Ownership Portfolio
The balance as of July, 10 2016 totaled $1,179,194.34.
I’d love to hear your thoughts about this portfolio. Do you think it will last for the next 20 to 50 years? Your comments are welcome.