Choose Quarterly And Monthly Dividend Stocks For Dividends Every Month
The purpose of this article is to address tips for building a 12-month dividend portfolio. So, you can start making dividends every month.
Let’s jump right in…
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What Is A 12 Month Dividend Portfolio?
A 12-month dividend portfolio is a collection of dividend stocks. Where stocks are selected specifically to generate dividend payments each month of the year.
How To Build A 12 Month Dividend Portfolio
To achieve the goal of monthly dividend payments, build a diversified dividend portfolio from monthly dividend stocks and stocks that pay dividends quarterly.
First, understand typical dividend payment patterns. Second,select and buy stocks
from each of those patterns.
By doing so, you will soon be earning dividends 12 months out of the year.
With those highlights taken care of. Allow me to dive into the details.
Then you will know exactly how to build a 12-month dividend portfolio. Let’s get started with the 4 predominant dividend payment patterns…
Monthly Dividend Stocks
The easiest way to make a 12-month dividend portfolio is to invest in monthly dividend stocks . However, there are some things to be aware of about stocks that pay monthly dividends.
First, there aren’t that many monthly dividend payers to choose from. Roughly 50-60 based on my last count.
Second, monthly dividend stocks are clustered in relatively few sectors of the stock market.
Mainly real estate and financial services. Thus, it’s more difficult to build a diversified stock portfolio for dividends every month. By just selecting monthly dividend stocks.
Nevertheless, there are some options to consider for your investment dollars. Such as:
- Realty Income (NYSE: O)
- Stag Industrial (NYSE: STAG)
- Main Street Capital (NYSE: MAIN)
- Shaw Communications (NYSE: SJR)
You can use a fund approach too. One I like is the Invesco S&P 500 High Dividend Low Volatility ETF (SPHD).
Investing in SPHD is an excellent way to get immediate diversification. While earning dividends every month from the approximately 50 stocks it holds.
Quarterly Dividend-Paying Stocks
On the other hand,I prefer stocks that pay dividends quarterly.They open up many more dividend stock investment options.
There are 3 predominant quarterly dividend payment patterns you should be aware of.
They are:
- Stocks that pay dividends in January, April, July, and October
- Dividends paid by stocks in February, May, August, and November
- Stocks that pay dividends in March, June, September, and December
Thus, you can build a 12-month dividend portfolio by selecting at least one stock from each of the 3 patterns.
Let’s go through some examples of these stocks now…
Stocks That Pay Dividends in January, April, July, And October
Specifically, January, April, July, and October.
Some examples include:
- Altria (MO)
- Automatic Data Processing (ADP)
- Chubb Limited (CB)
- Federal Realty Investment Corp (FRT)
- Franklin Resources (BEN)
- Illinois Tool Works (ITW)
- Kimberly Clark (KMB)
- McCormick & Company (MKC)
- Medtronic (MDT)
Next, is the second quarterly dividend payment pattern…
Stocks That Pay Dividends in February, May, August, And November
These stocks pay in the middle month of each quarter.
Several companies that follow this dividend payment cycle include:
- Abbott Labs (ABT)
- Air Products and Chemicals (APD)
- Caterpillar (CAT)
- Clorox (CLX)
- Colgate-Palmolive (CL)
- General Dynamics (GD)
- Hormel Foods (HRL)
- Lowe’s Companies (LOW)
- People’s United Financial (PBCT)
- Procter & Gamble (PG)
All of these stocks are Dividend Aristocrats. They are stocks that have paid and increased their dividends annually for at least 25 years in a row.
And finally, the last quarterly dividend payment pattern.
Stocks That Pay Dividends in March, June, September, And December
Notable companies that follow this payment model are:
- Johnson & Johnson (JNJ)
- McDonald’s (MCD)
- Microsoft (MSFT)
- NextEra Energy (NEE)
- Raytheon Technologies (RTX)
- Southern Company (SO)
- Target (TGT)
- United Parcel Service (UPS)
- Walgreens Boots Alliance (WBA)
- Wisconsin Energy Group (WEC)
Okay. Now you know the main dividend payment patterns. There are others, but they are outliers.
And you know some stocks that fall into each of the patterns. Again, there are many more possible dividend stocks. But far too many to cover for today’s purposes.
Finally, you can either invest in monthly dividend stocks. Also, quarterly dividend stocks.
Next, let’s address some other closely related topics.
Frequently Asked Questions About A 12-Month Dividend Portfolio
Doing so with several frequently asked questions (FAQs). Related to understanding a portfolio built for dividends every month…
How Many Dividend Stocks Should I Own?
For the number of stocks in a monthly dividend portfolio.
First, you can own as few as 1 monthly dividend stock.
Or second, 3 stocks that pay dividends quarterly. As long as each stock of the three pays dividends on different quarterly cycles.
However, 1-3 stocks are typically not considered enough for adequate diversification. Academic research suggests that holding 20-30 stocks is best.
As long as they represent a good cross-section of industries and stock market sectors.
For example, don’t choose 20 utility stocks. Or, 25 consumer staples companies.
How Do I Pick Dividend Stocks?
There is a lot more that goes into picking the best dividend stocks. Aside from when a stock pays its dividends.
So, you should assess other dividend metrics
too. When making your 12-month dividend portfolio.
Important things like a company and its stocks…
- Dividend yield
- Growth rate
- Dividend payout ratio
- Track record of dividend payments
- …to name just a few essential considerations.
Where Else Can I Find Stocks For My Monthly Dividend Portfolio?
If you are looking for more examples of dividend stocks for your monthly portfolio. Beyond the ones, I have highlighted in this article.
Then consider the Simply Investing Report & Analysis Platform. It is a robust interactive database of dividend stocks. Providing all the up-to-date dividend metrics.
Plus, recommendations of the best stocks to buy and when to buy them.
For stock recommendations delivered to my inbox every month.
Both of these services take the guesswork out of choosing stocks. For building out a monthly dividend income stream.
Can I Lose Money On Dividend Stocks?
Yes. You can lose money investing in dividend stocks.The companies you own encounter financial difficulties. Or, when the stock market overall goes down.