Over the last several decades the idea of being able to live off of dividends has been largely viewed as being a pipe dream for most. With the average S&P 500 dividend stock only yielding 1.29% in December of 2021, the thought of being able to not only fund a retirement using only the proceeds from dividend payments, or even being able to retire early and live off of dividends sounds ludicrous in today’s world. Looking at the historic dividend yield chart, we can see the average dividend paid to shareholders is currently near an all time low. Back in the early 1980’s companies used to pay significantly more dividends to shareholders, which averaged over 6%. And if we look back even further to the 1950’s companies would regularly pay dividends of over 7% or more.
There’s been two major things that have happened in the stock market, one of which happened within the last few years and another major event is currently going on right now as we speak. These things have made it possible for people to live off dividends with much less money than for previous generations.
#Dividends #PassiveIncome #DividendInvesting
S&P 500 Dividend Graph:
https://www.multpl.com/s-p-500-dividend-yield
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