In 2025 I made my first $1000 in dividends, but here is why I will not see that money anytime soon
- financewme
- 4 hours ago
- 2 min read
What are dividends?
Dividends are payments to shareholders (people who own the company’s stock) as a way of saying thank you for investing in our company. These payments are based on how many shares that you own in that company. Most companies pay dividends on a quarterly basis, but it really depends on the company. Some stocks that I own pay on an annual, bi-annual, or even monthly basis. It truly is up to the company to decide when they share their profits.
The best way to describe it is going to a cookout where everyone brings something. You bring your dish(es), which is your investment to the cookout. Everyone who contributes brings a plate home. That plate is your dividends.
My Yearly Breakdown of Dividends I purposely targeted stocks and funds that return dividends. A little over half of the companies I own stock in do they pay me a dividend. The smallest dividend I received ever was from Nvidia for $0.01 and my largest was $60.87 from Zim Integrated Shipping Services.
2021 | $0 |
2022 | $87.06 |
2023 | $301.25 |
2024 | $754.17 |
2025 | $1,131.59 |
The Kicker: Why I Will Not See That Money Yet
When you receive dividends, you have two options take the cash or reinvest into the same stock. On average, for each dividend I receive per quarter is about $12. I can take the cash and pay some bills but then the money is no longer working for me. If we are being honest in this day in age, what can you really spend $12 on that is worth more than your future.
Instead, I reinvest. This option allows me to buy more shares without spending anymore of my own money. This helps build compound growth (simply get richer quicker). Additionally, the more shares I own, the more dividends I will receive in the future.
The Part People Forget: Taxes!
Receiving dividends may be considered taxable income. If your investments are in a brokerage account, your dividends may be taxed. However, if your dividends are in a Roth IRA or 401(k) then you do not pay taxes on them.
Learning to reinvest dividends has changed how I view money. Every dollar I earn now has a job to do. My goal with financew.me is to help others see that investing is not only for the wealthy. It is about starting small, dreaming big, and growing with me!
Want to learn more about dividends or how to invest in general, set up your first 30-minute consultation with me today for only $15! Not ready to book
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