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I was re-evaluating my new Dividend Snowball plan from just a few days ago, mainly to see if there was a more efficient way of doing what I said I was going to do. So, I did what I always do: I made a nice spreadsheet.
The idea was simple: What if my Vanguard funds bought one whole share of themselves, or more than one if it was doable with only 50% of their dividend while the rest went to reaching the ARR and AGNC share goals?
The end result was kind of crazy, assuming no fluctuation in share price or dividend per share, it would only take 45 months for my existing shares at Vanguard to complete the push for those two funds. With an end result of $429 per month in dividends. If I attempted to speed things up by having all the funds buy more of themselves it would take 52 months to do the same thing, and it would only result in about $65 more per month. EARN would go from 2,000 shares to 3,000 in this time frame, but we know that in just six months its share value is down 10%.
That principal reduction was the entire point of making the new plan in the first place. What this spreadsheet does, though, is give me a visual of how many shares I can buy each month of my target funds without adding new money to the account. The starting line is about 14 shares of ARR and 1 share of AGNC. The real kicker, though, is that this doesn’t include Robinhood shares, or new money.
At present, Vanguard dividends are roughly $220-$240 a month. My wife’s Robinhood is around $47-50 a month, but that is entirely set to DRIP on O, MAIN, and BLOX, which means we have to remove it from the monthly Robinhood calculation. Let’s take our low end and make a conservative estimate of $200 in Robinhood dividends that can go into this plan from the start after the $50 from the wife is removed. That’s $420 a month. That takes us to 25 shares instead of 15. That takes us from 21 months on ARR down to 13. Then 16 more months for AGNC. That drops us to 29 months instead of 45. Without any additional money added.
That seems like a solid plan to me. The total from those funds plus the ones in my wife’s account would be roughly $750 per month. That is ignoring the HYSA interest (which I normally count), and the remaining weekly paying funds, but I think by adding paycheck and/or side hustle money, the $1,000 a month goal can be reached in under 24 months.
~~Miniwing~~
Investor, Stoic, Optimist
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