Using Stock Dividends to Pay for Current Expenses

Yesterday was a good day for me when it comes to passive income. I made a nice chunk of change with my blog over at Cash Flow Mantra as well as received a nice dividend payment in my retirement account that will be used to increase my stock holdings resulting in further dividend payments in the months and years to come. Then that money will be available to me for my expenses when I retire.

Paying Expenses with Dividends

Being a member of the personal finance blogging community allows me to see what many individuals are doing with their finances since they have a tendency to write about it frequently. Some will post passive income or blogging earnings online. Others will post monthly net worth statements with all their assets and debts listed for the whole world to see. I am unlikely to be that transparent, but I can say that I will end up sharing certain aspects.

One of the things that many of these bloggers like to do is invest in dividend paying stocks. There are several blogs devoted solely to dividends. Some of these bloggers are setting aside almost 50% of their income for investing. They are then growing their investment portfolios with the plan of being able to live solely off the dividends. I can tell you that some of them will be able to do it very soon.

I can't do that yet since I have lots of debt to pay off, but I can use some of the information they share and benefit from it in some way. Reading the analysis of the various blogger about dividend paying stocks gives me ideas that can then be used to make passive income.

For example, after reading about Intel yielding more than 4% on several different blogs, I started to examine the stock as a potential dividend play. In August, I ended up purchasing the stock at $20.50. The stock has done fairly well since then and closed at $24.02 today. Plus I have been able to collect some dividends as well.

My dividend plan for 2012 is to increase the number of stocks that I own in my retirement account that pay dividends. Ultimately when I retire, I plan on using the dividends for passive income to pay my expenses. The dividends that I got yesterday came from an oil drilling company and could eventually be used to pay for my transportation costs. As the price of gas has increased so has the value of my stock. So even though I don't like paying higher gas prices, at least I get some benefit.

I will be reviewing my progress on my blog periodically and track the quarterly dividend income to see how close I am coming to my goals. One of the biggest benefits of blogging about personal finances is the increased focus and attention that results. Because of this increased attention, I have been able to pay off one of my credit cards and even start to make money with my blog.

I have other goals for 2012 that I will be preparing and sharing both here and on my personal finance blog. I trust that by putting down these goals in writing, I will be able to stay more focused and achieve greater things in the coming year.