Watching Dividend Payments Grow
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I feel like I have been talking about this a lot lately, but I was entering some dividend payments I recently received into Microsoft Money and say the dramatic effect of reinvesting dividend payments. I am going to take one of my stocks as an example and show you what has happened over time.
The following chart shows the various dividend payments I have received from one of my best holdings – RBC Royal Bank (RY.to). You will notice that over time the dividends that I receive has been shooting up. This is because each and time I receive a dividend payment from the company, I plow that payment into more and more shares. The effect this has, even over a relatively short period time, is huge. The big jump in the early years was because I made a couple of purchases of shares as I built my position, but since August of 2004 the increases has all been because of dividend reinvestment.
This is very powerful stuff. If you trend line this out into the future, it becomes clear that the amount of money that RBC Royal Bank pays me will be quite substantial. The cool thing is I don’t need to do anything – it all works automatically for me.
10 Comments on this post
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The Dividend Guy said:
Testing Spam Karma and Bad Behavior – getting way too much comment spam on the site!!
January 28th, 2007 at 6:21 pm -
Growth in Value said:
…I feel like I have been talking about this a lot lately, but I was entering some dividend payments I recently received into Microsoft Money and say the dramatic effect of reinvesting dividend payments…
We won’t hold it against you. Your blog is called “The Dividend Guy blog” after all.
You’ve once again shown the awesome power of DRIPping a company that consistently increases dividends.
January 29th, 2007 at 10:18 am -
Cdntrader said:
does microsoft money do the charting for you?
thinking of getting something to help with profolio performance tracking
January 29th, 2007 at 8:20 pm -
Kimberly said:
Just in case you see a bump in traffic, we selected you as a top financial blog. We tried our best to make sure that the blogs selected were actually in the state we thought they were in, so I apologize in advance if we accidentally put you in the wrong spot.
http://www.yourcreditnetwork.com/blog/TheStatesOfCredit.aspxJanuary 31st, 2007 at 12:07 pm -
bill said:
Do you also sell your stock to lock in profits and plow them back in when the stock drops? This can also have a dramatic effect on your total return.
June 19th, 2007 at 8:56 am -
ninad said:
Do you also advice abt stocks?
http://www.regal-finance.co.ukAugust 22nd, 2007 at 4:48 pm -
bills said:
Are stocks that pay dividends better than stocks that don’t?
August 27th, 2007 at 12:25 pm
[...] The Dividend Guy presents Watching Dividend Payments Grow posted at The Dividend Guy Blog. [...]
[...] The Dividend Guy presents Watching Dividend Payments Grow posted at The Dividend Guy Blog. When a coach wins a Super Bowl like the Colts did this season, reinvesting their success into the team should help make it even better next year. The same with investing, plowing your gains back into your portfolio can help you leverage the power of compound growth. [...]
[...] Watching Dividend Payments Grow I feel like I have been talking about this a lot lately, but I was entering some dividend payments I recently received into Microsoft Money and say the dramatic effect of reinvesting dividend payments. I’m going to take one of my stocks as an example and show you what has happened over time.The [.] (more) [...]