Hi everyone. I just wanted to give you a quick update. I have temporarily increased the Minimum Contribution to my dividend portfolio. Up until now, I’ve been contributing a minimum of $500 per month to my portfolio. That’s not bad, but I think I can do better. I want to rebuild my portfolio as fast as I can, but, unfortunately, I have too many competing interests. So let’s take a brief but closer look at the issue.
Why Increase The Minimum Contribution?
To put it simply, the more money I can invest now, the better! Unfortunately, I’m not in my twenties (or close to that), so I need to get the ball rolling. At this point, I certainly won’t be rich off dividends, but I hope to have enough so that I can cover my expenses. Based on my August 2020 Dividend Income Report, I can cover my Acorns and Hulu Plus bills, but that’s about it. It’s going to take some time before my dividends can cover all my expenses, but I’m in it for the long haul.
In reviewing my budget, I realize that I still waste a lot of money every month. Given my circumstances, which I won’t necessarily get into, it’s difficult for me to cook regularly. Therefore, I tend to eat out everyday. Still, there’s no reason I can’t be smart about how I spend money eating out. So, for the past two weeks, I’ve been working on sticking to a cash-based budget as it’s too easy to spend money on a credit card. Although I don’t have a 100% success rate, I can report that I’ve made significant progress. Based on that progress, it’s allowed me to increase the minimum contribution to my dividend portfolio, albeit temporarily.
Why Temporarily?
The main reason is, and believe it or not, I still haven’t closed on the condo. The latest guidance I’ve received is that I should close sometime in October, but until I receive an official date, the guidance means nothing to me. There is still a small chance I might lose the condo, but a much more likely chance is that I would need to dip further into my retirement account to “afford” the condo. Although not ideal, and for more reasons than one, I prefer the latter option. Once everything is finalized, I’ll discuss fully all the financing behind this condo purchase.
Arguably, prudence suggest that instead of contributing extra to my dividend portfolio (or mortgage for that matter), I should instead save this extra money. That would reduce the risk of me having to tap into my retirement account. That is undoubtedly a valid point.
However, personal finance is indeed personal. I know myself. The consistent behavior I’ve exhibited in saving and investing a portion of my income is invaluable to me. That good habit is the reason why I’ve been able to max out my retirement accounts each year. The more good habits I can employ, the better, and increasing the minimum contribution to my portfolio is a good habit!
That being said, I expect that once I have a closing date, I may have to go back down to the $500 per month mark (or less). But, in 2021, I do intend on revitalizing my financial plan with dividend growth investing a key part of that plan!
How Much Is The Temporary Increase Of Minimum Contribution?
So how much did I increase my minimum contribution by? The answer is an extra $250 per month. Therefore, my temporary minimum contribution is $750 per month.
I really wanted to get to $1000. I’m still looking at ways to get to this $1000 per month mark because I have a goal of reaching $10,000 in my dividend portfolio by the end of the year. Because, I’m a Debbie Downer, I’m assuming the worst case scenario that my stocks or dividend income won’t increase. So, I will have to rely on my contributions to get to my $10,000 threshold. In other words, I hope for the best but plan for the worst.
If I can get the contribution up to $1000 per month, I might just be able to make the cut off. Stay tuned, as I will definitely let you know whether or not I was able to achieve this milestone.
Conclusion
Well, there you have it. I’ve committed to temporarily increase the minimum contribution to my dividend portfolio. I anticipate that this number may reduce sometime in January 2021, but I will try my very best to maintain this current minimum contribution for as long as possible.
For what it’s worth, I was inspired to write my article upon review upon Bert’s post about Crossing $12,000 in Dividend Income.
What did you think of this post? Let me know by commenting below.
The post Minimum Contribution Temporarily Increased appeared first on Dividend Portfolio.
