I’ve Hit a New Money Milestone! – Millionaire on the Prairie

Indulge me for a moment as I pat myself on the back for hitting a pretty significant-to-me money milestone! When I was updating my various spreadsheets, I realized that I had done something I’ve only ever read about. In the first six months of 2024, the amount of dividend income that I’ve received exceeds the amount of dividend income I earned for the entire year of 2019! This means that, within the space of only 5 years, I’m on track to double my annual dividend income.

Not too shabby at all…

As long-time readers know, I’ve made many money mistakes. I’m a DIY-investor and I didn’t have the benefit of blogs, podcasts, and websites about money when I started. It took me a long time to course correct. Even still, the one thing I did absolutely right for the past 16 years of my investing journey was to invest money from every paycheque. (I will admit that I started investing in 2004, but then the stock market crashed in 2008 and I stopped investing for 6 months. While I didn’t sell anything, the fact remains that I completely missed the fantastic buying opportunity. I still think about what could’ve been had I not acted like a dummy…sigh…)

As my debts got paid off, I re-directed the lion’s share of those former payments to my investment account. As a teenager, I started down this path by investing $50 from my bi-weekly paycheque. By the time I had my first adult job, that amount was a few hundred dollars every two weeks. When my mortgage and SUV loans were paid off, those amounts meant I could invest atleast $1,000 every two weeks. I was still living below my means, instead of allowing money to burn a hole in my pocket. Trust me – there was still money being saved for short-term goals like travel, renovations, and annual insurance payments. Bottom line, I invested first and lived on what was leftover.

And I’ve always used a DRIP for all of my dividends. DRIP stands for dividend re-investment program. I’m nearly at the point where my dividend income matches the amount of money I contribute to my portfolio every year. If all goes according to plan, I’ll hit that particular money milestone in 2026. Until then, I will continue to revel in the fact that my DRIP is causing my portfolio to grow exponentially faster than it would if I were relying solely on my contributions to increase its value. At this point, I earn returns on my contributions and my DRIP units. This is so much better than only earning returns on my contributions.

Today, my choices are paying off. This year, I’m on track to have my dividend income exceed my planned spending. This is another spectacularly fantastic money milestone! According to the wisdom of the internet, I’m financially independent because my portfolio is covering all my costs. At this point, I can live off my dividends and I don’t have to work anymore, so long as nothing goes sideways. Is that amazing or what?

On some level, I knew I would hit this target eventually but seeing it on my spreadsheet has made it very, very real. In the first 6 months of 2024, my portfolio has covered every single purchase that I’ve made.

So what changes?

Not much. I’m going to bask in the joy of this accomplishment, then go back to my regularly scheduled life. I’m content with how I spend my money. There’s very little more that I want. And while I’m technically financially independent, the fact remains that I’m “only” Lean FIRE. I want a little more margin before I hang up my gloves. I’d like for my dividend income to exceed my expenses by atleast 20%. That way, whatever’s not spent can pile up and pay for those inconvenient and irregular expenses. In short, my cash cushion needs a little more padding before my employer and I part ways.

My plan was very simple, but it was never, ever easy. It took me along time to get here, mainly because of some mistakes I made along the way. When I learned better, I did better. On top of that, there were always temptations to spend my money on something. I remained laser-focused on my priorities and did what needed to be done to ensure that my money only went to that which was most important to me.

Now, my portfolio is paying me more money every year. Five years ago, I wouldn’t have imagined that I’d earn an entire year’s worth of dividends in only 6 months. Yet, here I am – hitting my goals way sooner than I’d thought I would and still sticking to my plan. This is a day to celebrate. Yay, me!