Asked by Anonymous

Is it possible to live off of dividends?

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  • Yong Kah Hwee
    Yong Kah Hwee
    Level 6. Master
    Answered on 28 Feb 2019

    I would think yes. Assuming you need $4000 a month to live on, and you can get dividends at 5% consistently. You'll need a capital of $960,000. Quite a huge sum, but 5% is a conservative assumption!

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  • Guo Hao Teo
    Guo Hao Teo
    Level 4. Prodigy
    Answered on 28 Feb 2019

    Yes this is possible. just simply work backwards:

    • understand how much you will need to survive (varies from singles to families)
    • plan out how much is a realistic return for dividend yield
    • most likey around 5 - 7% p.a
    • create a diversified enough portfolio for that amount

    Done. You can actually do this and i have friends also doing things like that in their 40s. By right they have no real need to work

    Only thing is to manage your cashflow well as dividends can be quarterly or yearly.

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  • HC Tang
    HC Tang, Financial Enthusiast, Budgeting at The Society
    Level 8. Wizard
    Answered on 01 Mar 2019

    Certainly. But you still have to manage them from time to time as nothing remains the same forever.

    See this by Seedly , all the calculations and summary there:

    https://blog.seedly.sg/dividend-investing-how-much-you-need-to-invest-passive-income/

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