Dividend Growth Investing Starter Pack

Sample Portfolios for Any Age

When starting out with dividend growth investing it can be hard to know what companies to start with.  There are thousands to choose from, not to mention Exchange Traded Funds (ETFs) and Closed End Funds (CEFs) too.  With this in mind, I have created the Dividend Growth Investing Starter Pack to help identify ideas of sample portfolios that you can start from. 

Remember that you will need to do research on your own to determine the right fit, but these are companies that I either own or have done extensive research on and believe they can be a good fit for most investors.

The Starter Packs are broken down by the individual stocks or ETFs/CEFs based the current age of the investor and/or the timeline until the investor needs to use the funds:

• 25 years old / 35 years to go

• 35 years old / 25 years to go

• 45 years old / 15 years to go

• 55 years old / 5 years to go

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Portfolio Diversity

Most common advice recommends at least 20-25 stocks from different industries for diversification.  Getting to that number early in your investing career can seem overwhelming, so I picked 10 stocks for each age group as a starting point and you can add additional holdings over time.  ETFs are also a good place to start, you only need a couple and it gives you easy diversification without a lot of the background research you need for individual companies.  This article by Investopedia provides a good breakdown of the math behind the number of stocks to own and is highlighted below.

Your choice of current dividend and dividend growth should be based on your timeline of when you will be using the funds.  I explain this concept in detail here.  In short, the longer your timeline until you need to use the dividends, the lower the starting yield can be and the higher the dividend growth should be.  Dividend growth will outpace the higher starting dividend over time.

We should all have a plan for our investments.  Our timeline, goals, income needs, risk tolerance, risk capacity, and diversification requirements should be taken into account.  I discuss some of the things to consider when starting our journey here.

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Dividend Growth Investing Starter Pack

I have provided picks for each age group / time remaining so that you can tailor your approach to where you are in your investing journey. Please remember that this is just a sample portfolio and may not fit your needs or risk tolerance.  Individual due diligence is required before any purchase is made.

Valuation should be considered as even a great company can be a bad investment if bought at the wrong time when the price is higher than the fundamentals of the company can justify. For more information about valuing a dividend growth stock, check out my previous post on valuation here. Another option is to buy in over time through dollar cost averaging, where you buy a set amount each week/month no matter what the price is so that you can average out your costs over time.

Here are the Dividend Growth Starter Pack for each age and timeline:

25 years old / 35 years to go

Stocks:

ETFS:

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35 years old / 25 years to go

Stocks:

ETFS:

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45 years old / 15 years to go

Stocks:

ETFS:

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55 years old / 5 years to go

Stocks:

ETFs/CEFs:

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Dividend Growth Investing Starter Pack Conclusion

Dividend growth investing is a great path to financial freedom and passive income for any age. The earlier you can start the more time compounding and dividend growth have to work in your favor. For those whose timeline is a little shorter, choosing quality companies with higher current dividends will expedite the process. A balance of current dividend yield plus dividend growth should be determined based on your timeline. These dividend growth investing starter packs can be a great starting place to begin your research and provide ideas and examples on how to structure your portfolio. Remember to always do your own due diligence before investing your hard earned dollars.