My Dividend Stock Portfolio Review This Year (Beginner’s Perspective)
I’ve been slowly collecting dividend stocks since last year, and since it’s the end of the year, I reviewed my portfolio. It may look pitifully small compared to seasoned investors, but I’m sharing this to show there are people like me too.
1. For Korean dividend stocks, I hold 3 stocks mainly in banking/insurance, with an average dividend yield in the early 5% range
2. For the U.S., just SCHD, investing a fixed amount every month
3. Only one REIT; I thought quite a bit about taxes
4. Keeping cash at about 20% of the total
Total dividends came to about 1.2 million won before tax. At 100,000 won a month, that’s just a few orders of fried chicken, but I believe it will clearly make a difference as it builds up.
My biggest regret is that last year I was so excited about receiving dividends that I spent them instead of reinvesting them all. This year I reinvested 100%.
10 answers
Well... with dividend yields in the low 5% range, haven’t you considered the risk of dividend cuts on bank stocks? Some banks cut their dividends last year, so going in based only on an “average of 5%” seems a bit risky.
Is there a source? If it's 1.2 million KRW pre-tax, I'm curious how much goes to each item.
I don’t agree. If you only pile into dividend stocks, the opportunity cost of missing out on growth stocks is bigger; for beginners, I think just sticking with an index fund is better.
Oh, I didn’t know this. How did you handle the REIT taxes?
I'm doing something similar, mostly accumulating Korean bank stocks—honestly, it's the dividends coming in that make it worthwhile lol. Hang in there!
Have you calculated it after tax? If it’s 1.2 million won before tax, what you actually take home will be considerably lower, and it seems that wasn’t reflected in your portfolio assessment, which is a bit unfortunate. It would also help later if you laid out the dividend income tax and the comprehensive financial income taxation brackets.
Agreed, agreed. I was so excited when my first year’s dividends came in that I spent it all lol. Looking back now, that was such a waste.
With 20% in cash, that’s pretty defensive for a beginner. But I’m curious—you said you were concerned about REIT taxes, so what made you end up including one REIT anyway? I’m wondering if you added it because of the dividend yield.
I also only do monthly dollar-cost averaging into SCHD, and having fewer holdings actually makes it easier to manage—I like that. I think not being greedy is the hardest part.
You said 100,000 won a month is about the price of a few chickens, but if you calculate that with compounding over 10 years, it grows bigger than you'd think. I've been doing nothing but reinvesting for five years now, and I was like that at first too. But what's really important is continuously adding principal rather than reinvesting...