Hey folks, welcome to my first entry in my personal investing series, DIT1M. It might sound like a typical gamer tag, but no. DIT1M actually stands for Dividend Investing to $1 Million. Armed with nothing but a handful of investing knowledge from working in fintechs and my ever-reliable Googling skills that has served me well thus far, I’m going to try and make that a reality.
Ideally before I reach 45 too, which leaves me with… 15 or so years.
Yes, you now roughly know how old I am. My god, the dreaded 30 is lurking around the corner.
But you’re not here to listen to me go on about my quarter life crisis and mounting back pain.
Let’s get straight into the juicy stuff, starting with my portfolio breakdown. I’ll tackle some questions afterwards to provide more context on this series and what you can expect to gain from it.
My S$30k Dividend Portfolio
I only started seriously investing when I was 25 years old, which as far as I’m concerned, means I’m a late, late bloomer. If I could do things over again, I’d definitely start investing earlier.
And not date my crazy ex.
And not dump tens of thousands into a 2D side scroller game known as Maplestory.
We live and learn.
But I digress.
Now, you might be thinking… a $30,000 portfolio is nothing to write home about. Why would I give a damn about your investment strategy if you’re as piss poor as me? Heck, I’m sure a majority of you have more invested than me.
I’m entirely in agreement as well. But this series was never meant to be me “bragging” about my non-existent wealth. It never was, and it never will be.
My goal is to be as transparent about my investing journey as possible. And above all else, I want to prove that even with a small capital and a humble salary, as long as you remain consistent and stay invested, anything is possible. I want this series to be a reflection of what realistic investing in Singapore for a young adult is like because not everybody is a trust fund baby.
Enough rambling – onto my holdings.
Stock Breakdown
- Intel Corporation (INTC)
Number of Shares: 72.037
Invested Amount: $2,022.80
Current Value: $1,768.50
Change ($): -$254.30
Change (%): -13.58%
Starting from my smallest holding, we have the storied chipmaker from America. Once a hallmark of cutting-edge American manufacturing and the biggest provider of semiconductor chips in the world (cue eagle flying gracefully overhead amidst a blaze of gunfire), the chip manufacturer is a shell of its former self, having fallen far behind competition in recent years.
I’m sure we all know Intel. What we don’t know is if it’ll ever recover after the battering it took.
As of time of writing, Intel is down over 50% from its all time highs. Declining year-on-year revenue numbers (7 straight quarters of declining revenue, damn!) plus a significant loss of market share to its biggest rival, Nvidia, have shaken investor confidence. On top of that, Intel CEO Pat Gelsinger’s daring plan to revitalise the company through dumping billions on R&D in a bid to regain lost ground is also viewed as a risky one by onlooking investors.
After all, we’re already 3 years in, and there’s not much to show for yet.
Personally, I believe Intel will recover. I actually like its plan to catch up with its competitors. It’s a strategic investment for the future. I think Gelsinger is the right person for this job as he understands the only way for Intel to catch up with its peers is by once again rediscovering what made it a giant of the semiconductor industry in the first place all those years ago – innovation.
And as funny as it sounds, the fact that it’s suspending its dividends in Q4 only makes me more confident that it’s on the right path. The cash spent on paying out dividends to shareholders can now be reinvested towards R&D, which should speed things up further.
As it stands, Intel sticks out like a sore thumb in my portfolio. It’s a smudge of red in a sea of green. But that’s investing for you – there are ups, and there are downs. I’m going to stick with my guts and continue to buy shares of Intel while it’s on year-end sale.
P.S. I know that Intel should no longer be considered a “dividend stock” as it has suspended its dividends. I will personally continue investing into it on the side but I’ll stop including it in this series. Most likely, I will add another stock to replace it.
- Apple Inc. (AAPL)
Number of Shares: 8.3935
Invested Amount: $1,399.95
Current Value: $1,888.53
Change ($): +$488.58
Change (%): +34.95%
Because who doesn’t have at least one friend who’s an Apple fanboy?
I was an Android user in the past. I caved around 5 or 6 years ago and bought an iPhone due to peer pressure. I wanted to find what the hype was about.
I never looked back since.
I understand the appeal and allure behind Apple’s products. They’re sleek and aesthetic, and owning the latest iPhone model has somewhat become a bit of a status symbol and a show of wealth. So, naturally, every Singaporean has seemingly made it their life mission to purchase one the moment they’re released.
Kaching.
Despite Apple products selling like hotcakes, I believe the main pillar behind Apple’s success doesn’t lie in its ability to acquire, but rather retain. The iOS ecosystem is designed in a way to allow for maximum convenience and information sharing – as long as you own Apple devices for every aspect of your life. The moment someone buys an Apple product, he or she will most likely become a convert for everything else just to enjoy the benefits of being connected via one ecosystem.
And if you’re not sold yet, just ask yourself… how often do you hear of someone switching away from Apple to Android? Or any other OS for that matter?
Tell you liao.
I will definitely buy more into Apple when the buying opportunity arises.
- The Coca-Cola Company (KO)
Number of Shares: 30.709
Invested Amount: $1,839.24
Current Value: $1,934.38
Change ($): +$95.14
Change (%): +5.17%
Everybody knows Coca-Cola. Regardless whether you love or hate the sugar-laden, fizzy soft drink, you can’t deny how iconic and influential it is. Coca-Cola shaped the entire soft drink industry we know and love today, paving the way for many other brands we know with their innovative marketing tactics, memorable commercials and perfectly contoured glass bottles.
Today, almost a century and a half since its inception, Coca-Cola is worth hundreds of billions.
So… why Coke?
Well, for one, it’s dividend royalty with a history of dividend increases for 55 straight years. It also has an absurdly strong foundation spanning over a century, an untouchable branding and incredible financials.
On top of that, I think it’s worth pointing out that you’re not just investing in that iconic fizzy drink. The Coca-Cola company has acquired tons of brands and currently own an impressive portfolio spanning across different beverage categories. Some examples are Costa Coffee, Minute Maid, Sprite, Fanta, Dasani… You can find the full list here on their website.
Point is, you’re not only putting your trust in a single beverage. You’re betting on pretty much the entire beverage industry with this one investment.
I think no other company comes remotely close to Coca-Cola in those metrics. Perhaps Pepsi, but I’m not about to engage in some century-old debate. (Am I the only person who can’t taste a difference between these two?)
As someone who’s health-conscious, I’m admittedly not the biggest fan of soft drinks and hence about 30% of Coca-Cola’s portfolio. But just like with Altria Group, I’m not foolish enough to let such a great stock slip through my fingers just because of how I feel about their products.
- ExxonMobil (XOM)
Number of Shares: 21.049877
Invested Amount: $2,039.86
Current Value: $2,483.04
Change ($): +$443.18
Change (%): +21.7%
ExxonMobil has roots going as far back to 1866, when the infamous John D. Rockefeller himself and a group of partners formed the Standard Oil Company.
I’ll leave the boring history lesson out, but this giant of the oil and natural gas industry has an interesting backstory, having lived – and arguably, flourished – through all of the world-altering events in recent history. Wars, recessions, political conflict… ExxonMobil has stood tall through it all.
And that’s the biggest vote of confidence you can ever get. If two damn world wars and even multiple recessions have taken their shots and couldn’t topple this company, you can be damn sure that it has some solid, solid fundamentals.
Deep connections and deeper pockets aside, you might be wondering… if this company is so damn big, why haven’t you heard of it before? Well, here’s the thing – you probably have. It operates in Asia too, just under a different trading name.
Esso.
Yes, that petrol kiosk we’re all so familiar with.
So, with all that said, I don’t think I need to elaborate anymore on why I own so much of this stock. The need for energy is universal and only expected to grow in the future. ExxonMobil is perfectly positioned to capitalise on this growth.
- Visa Inc (V)
Number of Shares: 9.0059
Invested Amount: $2,191.94
Current Value: $2,837.58
Change ($): +$645.64
Change (%): +29.46%
Another big name on this list. Visa needs no introduction, and the electronic payment provider has a business model that other companies on the S&P500 can only dream of.
Due to the nature of their business, Visa has an incredible 50%*~ net profit margin. In comparison, Microsoft (with SaaS as some of their main product verticals) has about 35% while Apple trails behind with about 25%. This profit margin is almost unheard of, and also one of the primary reasons why I’m such a big believer in Visa. It’s a highly profitable business, and their massive free cash flow further cements their position on this list.
Besides, do you see Visa realistically declining in the next couple of decades? Electronic cashless payments are only going to become more popular (I’m writing this sentence a lot, I know, but I need you to understand that it’s a recurring theme for a reason) and the biggest existing players will never let themselves lose their foothold on this highly lucrative industry.
Ah, I almost forgot. Why did I choose to invest in Visa over Mastercard?
Because the ignorant me all those years ago thought Visa was cheaper based on share price. No, I do not wish to elaborate on this any further.
P.S. I’ve never regretted owning Visa over Mastercard. I think it’s a stretch to say one company is better than the other – they’re both excellent investments if you’re looking at exposure into the electronic payment industry. I might do a deep-dive and compare both companies in the future, and when I do, I’ll be sure to link it here.
*Net profit margins stated are as of 30/09/23
- Altria Group Inc. (MO)
Number of Shares: 56.81067
Invested Amount: $2,444.56
Current Value: $3,280.24
Change ($): +$835.68
Change (%): +34.18%
Unlike the previous two picks, Altria Group might need an introduction. The product that they produce needs no introduction though.
Rokok la bang.
Altria Group is the undisputed leader in tobacco production. It boasts of enduring brands such as Marlboro cigarettes and Black & Mild cigars. You don’t know Black & Mild cigars?
… neither do I.
But aiya, Marlboro good enough already. Oh, and Altria also recently ventured into the smoke-free market with oral nicotine pouches and e-vapor pods.
I used to smoke. I am painfully aware of how addictive cigarettes are. Anything with nicotine in them, really. Pair that up with how smokers are some of the most price-insensitive individuals out there and you have a winning formula. I’m sure that demand for tobacco will never decline to the point where Altria collapses, and their willingness to adapt to an ever-changing world and invest in the e-cigarette industry makes me optimistic for their future.
I do want to clarify that I do not endorse smoking in any way. It can and most likely will negatively impact your life. However, if you’re already a smoker, consider switching to Marlboro to support my investment.
- Microsoft Corporation (MSFT)
Number of Shares: 9.777958282
Invested Amount: $2,745.94
Current Value: $4,140.57
Change ($): +$1,394.63
Change (%): +50.78%
Microsoft is the most self-explanatory stock in my portfolio. It’s the proverbial poster boy of the stock market after all. Rather than address the question of why am I invested in Microsoft, I think the better question is why would I not be?
Microsoft ticks off every box possible when it comes to looking for a stock to invest in.
Outstanding financials? Check.
Flush with cash? Check.
Great products? Check.
Clear roadmap into the future? Check.
Best gaming console? Okay, maybe that’s going a little too far. No company can be that perfect.
Still, we all rely on Microsoft in one way or another. You’re either reading this on a device powered by the Windows OS. Or you find yourself using Microsoft Office in your school or work. Or perhaps you have a screw loose and enjoy browsing the net on Microsoft Edge with Bing as your default search engine. Whatever the case is, my point is that Microsoft is so ingrained in our daily life it’s not going anywhere in the foreseeable future, making it a pretty safe bet.
The fact that it pays dividends is just the cherry on top.
- Schwab U.S. Dividend Equity ETF (SCHD)
Number of Shares: 210.4516
Invested Amount: $5,566.44
Current Value: $6,214.63
Change ($): +$648.19
Change (%): +11.64%
SCHD is one of the most popular dividend ETFs available in the market and for good reason – it has a stellar track record of double-digit annualised returns, has never failed to deliver dividend growth year-on-year, and has a low expense ratio of 0.06%.
Let’s take a step back. What even is this SCHD ETF?
SCHD tracks the Dow Jones U.S Dividend 100 Index which comprises the top 100 US stocks with strong fundamentals and a track record of paying out dividends for a minimum of 10 consecutive years. It’s widely considered the gold-standard for dividend ETFs, and has an almost cultish following due to its incredible performance since its inception.
Some examples of companies this ETF tracks are Blackrock (BLK), Chevron (CVX), Verizon, (VZ) and Ford Motor (F). The full list can be found here on Schwab’s website.
Realistically speaking, I’m never going to be perfect with my stock picks. Some of them are going to flop regardless of how infallible they seem on paper. SCHD is my hedge against the unpredictable market in my dividend portfolio.
Imagine this scenario. Say Altria Group goes to zero overnight because they declared bankruptcy. Yes, I touched all the wooden furniture in my room after typing that out. I’d lose every penny I’ve invested into Altria. And if I had put all my eggs in the one proverbial Altria basket, I would have lost everything.
Everything.
This is where diversification helps with risk control. As mentioned above, SCHD tracks an index which comprises of the top 100 US dividend stocks. Even if Altria crashes and burns, it’ll only go down slightly since there are 99 other companies that are still going strong with their valuations.
In addition, there are certain months where I can’t decide which stock to DCA into. SCHD is my fallback during those months; you can never go wrong with such ETFs.
How much have I earned in dividends so far?
The million dollar question. How much dividends have I earned from my S$30,000 portfolio? Okay, it’s actually S$33.6k now, but I just like whole numbers. Also, do bear in mind that I didn’t actually start the year with S$30,000 – I DCA’d myself up to this amount. I started the year around the $20,000 mark.
Anyway, here’s a chart showing my payouts over the year. It’s… not the most aesthetic looking, I know. I’m going to revamp my entire investment tracking sheet before the new year rolls around, so it will definitely look better come next DIT1M update.
In total, I have made US$297.34 so far this year from dividends alone. That’s almost S$400. I can’t live off of it yet, but it’s a respectable amount considering how small my portfolio is.
The best part is it will only continue to grow as I reinvest these dividends and continue DCA-ing into the portfolio. I’m excited to see how much it will grow in 2025.
My Investment Strategy For 2025
2025 is only a month away, and I have already started thinking about what kind of changes I should make to my portfolio.
At the moment, I’m leaning towards two major changes.
- Diversify, diversify and diversify even more
Change is the only constant in life. This bitter pill to swallow applies to one’s portfolio holdings as well.
With unprecedented geopolitical tensions and whispers of recession, I’m looking into other ways to protect my investments. But the main reason why I’m set on this is mainly due to how I’m too heavily invested in the US. With another Trump presidency comes another wave of radical and somewhat questionable economical policies, and let’s just say that I believe it’s the perfect time to diversify regionally.
And one actually doesn’t have to look too far from home for such diversification opportunities.
Yes, I’m talking about investing in Singapore stocks listed on the Singapore Stock Exchange, or SGX.
… put away those pitchforks. Let me explain.
The Singapore stock market is famous (or infamous?) for trading sideways with less than stellar growth over the years. As of time of writing, it has just recovered from the COVID-19 induced panic selling in 2020 which resulted in a decline of 31% from previous highs.
source: sgx.com
It’s been 4 years. And we’ve only just recovered.
All things considered, that’s about an average of 8% per year. Compared to the Nasdaq or NYSE, which capture gains averaging 15% and 11% respectively, it’s quite obvious to see why SGX isn’t typically at the top of an investor’s list.
The thing is… I’m not looking for growth. Well, at least not explosive levels of growth with companies like Tesla or Nvidia. I have other portfolios and allocations for growth stocks.
I’m looking for safe dividend stocks I believe have some growth potential and a proven business model that enables it to keep raking in cash for at least the next decade.
And you might be surprised how many stocks in Singapore tick all those boxes.
I’ll go into more detail regarding this when the time actually comes around, so stay tuned!
- Keep more cash on hand
Truth be told, I have almost no cash on hand.
It’s the best time to change that.
I believe buying opportunities will present themselves in abundance come 2025. It could be with certain stocks being battered down due to a poor quarter, or the broader market selling off after the publication of a piece of negative news. Having cash on hand would allow me to capitalize on those dips and grab stocks at a hefty discount.
It’s always the best time to buy when fear is at an all-time high.
And whilst my investment strategy revolves around DCA-ing at a fixed time every month (which I will still commit to), having some cash ready to additionally deploy at a moment’s notice is a great way of lowering the average price of the stocks you hold.
I’ll give a proper update when the new year comes around, but this should sum it up nicely for now.
Questions & Answers
Onto the question and answer portion! These are some questions I expect to emerge when first reading this series, or even when you first visit my blog. If you have any other questions, either leave them in the comments below or reach out to me directly via my contact me page.
Why 1 million?
It’s a nice round number and has a nice ring to it. Yes, I’m superficial like that.
Okay, but seriously. For most people, without proper planning and a sound investment strategy, a million sounds like a far-fetched dream. I want to prove that it’s actually possible for even the most average Singaporean as long as you’re financially savvy and invest smartly.
But lastly – and most importantly – having a million as investment capital allows you to live quite comfortably off the payouts. I will only be buying dividend stocks in this series, which as you know, pays dividends. Even with a very conservative estimate of an average 3% dividend yield across all the stocks I hold, it will still payout a respectable 30k a year. (I know that I’m not taking into account withholding taxes, but this is just an example)
Would that amount be enough to survive off in 2040 with how fast inflation is pushing the cost of living up? I honestly don’t know and I wouldn’t worry about that for now.
Why Dividend Investing in particular?
There are many reasons. But, as a TL:DR…
1. It’s relatively safe… as far as stocks go. This primarily comes down to my choice of dividend stocks to invest in. I only buy into high-quality companies with a long-standing history of dividend payouts, proving that they have good business fundamentals and healthy finances.
2. I love the idea of reaping your rewards. With traditional growth stocks that don’t pay dividends, the only way for you to “realise” your profit is to sell the stock itself after it has grown in value. You can hold onto dividend stocks and never sell and still enjoy profits in the form of dividends.
3. It allows me to be very hands-off with investing. Because I don’t ever have to sell my holdings to realise my gains, I don’t have to scrutinise the market on a daily basis, trying to capture the best selling or buying opportunity. I sleep like a baby every night without worrying about market fluctuations.
4. The snowball effect is on full display. You can really see your investment portfolio grow exponentially as you consistently reinvest your dividends. This is definitely more mental than anything else, but it feels good to see that you’re making good progress.
There are some other points that are more technical which I explore in my Dividend Investing 101 post, so go through that if you’re keen on finding out more about the pros and cons (yes, there are still cons) of dividend stocks.
Do you only buy dividend stocks?
I do not. I’m a big advocate of diversifying your investments. It’s the key to risk management. You do not want all your eggs in one basket – the collapse of just one industry or financial institution could wipe you out.
I hold some other asset classes, mainly bonds, crypto and fixed deposits. But stocks remain the bulk of my holdings since I can afford to take on more risk due to my age. And within my stock allocation, I mainly buy into stocks or ETFs that pay dividends.
For the sake of this series, to avoid confusion, I will only be covering the growth of my dividend portfolio in particular and nothing else.
Why do you support Arsenal Football Club?
Thierry Henry conned a whole generation, man. It’s been all downhill since 03/04.
What will this series entail?
It’s mainly going to be monthly updates on my dividend investing journey. Expect details like how my portfolio is doing broken down stock by stock, my dividend payout for the month (if any) and how the market is doing & corresponding plans to navigate it.
Still, I want to put it out there that I foresee occasional lapses in updates.
I’m going to be DCA-ing a portion of my salary on a monthly basis and if it’s not painfully obvious yet, I’m not Elon Musk and don’t command a multibillion dollar pay package. With limited buying power and only a handful of preferred dividend stocks, the content I can push is naturally somewhat limited.
Investing was never meant to be flashy after all.
This means I might skip over certain months if there’s nothing significant to report on. We’ll see how things develop as they go.
Will you be giving stock recommendations?
Walan eh. Don’t get me in trouble leh.
I’ll just state it upfront. It’s a firm and resounding no.
If you’re here looking for stock recommendations, you’ll have better luck searching for a tacky “Top 10 Stocks to Buy Now” article from The Motley Fool or Yahoo Finance. Not throwing shade or anything – I understand those are the kind of articles that get clicks – but you won’t be getting any of that here.
I will never recommend a certain stock. Period. I’m going to be writing and documenting my investment journey in its entirety, which inevitably means that certain stocks will be mentioned. I might even do a stock review or multiple reviews at some point. Regardless what the content might be, they shouldn’t be taken as recommendations.
Everything I write is my opinion and my opinion only. It shouldn’t be construed as financial advice in any shape or form. I’m fully aware of the risks pertaining to investment and still choose to do so because I believe the pros far outweigh the cons. However, it could be different for you. Make sure to do your own research and fully understand the risks before dipping your toes into investments.
What’s your career and what industry are you working in?
I work in Marketing and am currently in the fintech space.
Yes, I’m a dude. Yes, there’s a lot of females in marketing. No, there’s not only females in marketing.
What’s your salary?
I earn a comfortable amount. I’ll say I’m just above the average salary for people around my age.
I do invest quite a big chunk of my monthly salary and I’m transparent about how much I DCA, so take from that what you would.
This wraps it up for the first ever DIT1M post! Feel free to leave any other questions you might have in the comment section below. Stay safe, stay financially savvy, and above all, stay invested.
Until next time. Cheers.
