How to Create a Monthly Dividend Portfolio

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Passive income is income that requires no work hours. You don’t have to work at all or require little effort to earn money. It is also called progressive passive income.

A monthly dividend is one of the great options for passive income! Dividends are regular payments to the shareholders paid by companies. It’s a portion of profits or reserves, so if the company didn’t make enough money… sometimes there is no dividends payment. But still, it can be your additional passive income (:

If you want to learn how to build a monthly dividend portfolio, you have come to the right place.

Disclaimer: I’m not a financial expert. All content provided is for informational purposes only. This post may contain affiliate links, meaning I get a small commission if you decide to make a purchase through my links, at no additional cost to you. Please read my full disclaimer here for more info.

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Here is a summary of steps to build a monthly dividend portfolio:

Find out dividend stocks
Find out the dividend payable date for each stock
Pick the stocks for your monthly dividend portfolio
Purchase the stocks you have picked
Reinvest dividend to grow

I used Dividend.com and made this dividend calendar.

Note: I picked these 34 dividend stocks for this article, but there are more than 34 dividend stocks on the market. Please do your own research. I just presented the dividend calendar as an example.

Typically, stock dividends are paid quarterly. (Or some of them are anomalies) So, I created 4 different colors of group. If you buy a stock from each color of group, you’ll earn a dividend every month.

Before diving into each color’s dividend stocks, here are two investment vocabulary you must know!

Dividend yield = financial ratio that shows how much a company pays out in dividends each year relative to its stock price.

For example, you’ll earn $30 a year if you invest $1000 with a 3% dividend yield. (1000 x 0.03) You’ll earn $300 a year if you invest $10,000 with a 3% dividend yield. (10000 x 0.03)

Dividend yield changes daily because it is linked to the stock’s price. As the stock rises, the yield drops, and vice versa.

Years of consecutive dividend = Years that company has paid a dividend continuously. It’s like a credit score. For instance, we can trust 50 years of consecutive dividend companies than 1 year of consecutive dividend companies.

Blue group stock dividends paid in January, April, July, October:

MO: Altria / dividend yield 6.90% / 12 years of consecutive dividend
PM: Philip Morris / dividend yield 4.93% / 12 years of consecutive dividend
KMB: Kimberly-Clark / dividend yield 3.51% / 49 years of consecutive dividend
MRK: Merck & Co. / dividend yield 3.52% / 1 years of consecutive dividend
CSCO: Cisco Systems / dividend yield 2.81% / 7 years of consecutive dividend
GPC: Genuine Parts Company / dividend yield 2.47% / 59 years of consecutive dividend
JPM: JPMorgan Chase / dividend yield 2.17% / 1 years of consecutive dividend
NKE: Nike / dividend yield 0.77% / 1 years of consecutive dividend
MDT: Medtronic / dividend yield 1.86% / 44 years of consecutive dividend

Sky Blue group stock dividends paid in February, May, August, November:

COST: Costco / dividend yield 0.84% / 16 years of consecutive dividend
PG: Procter & Gamble / dividend yield 2.44% / 59 years of consecutive dividend
AAPL: Apple Inc. / dividend yield 0.67% / 8 years of consecutive dividend
ABT: Abbott Labs / dividend yield 1.53% / 49 years of consecutive dividend
ABBV: AbbVie Inc. / dividend yield 4.42% / 49 years of consecutive dividend
VZ: Verizon / dividend yield 4.43% / 14 years of consecutive dividend
MA: Master Card / dividend yield 0.47% / 1 years of consecutive dividend
T: AT&T / dividend yield 7.09% / 37 years of consecutive dividend
CAT: Caterpillar Inc. / dividend yield 1.70% / 28 years of consecutive dividend

Orange group stock dividends paid in March, June, September, December:

XOM: Exxon Mobil / dividend yield 5.76% / 1 years of consecutive dividend
CVX: Chevron Corp / dividend yield 4.84% / 34 years of consecutive dividend
JNJ: Johnson & Johnson / dividend yield 2.44% / 59 years of consecutive dividend
PFE: Pfizer / dividend yield 2.99% / 1 years of consecutive dividend
DUK: Duke Energy / dividend yield 3.84% / 14 years of consecutive dividend
SO: Southern Company / dividend yield 4.04% / 19 years of consecutive dividend
MCD: McDonald’s / dividend yield 2.18% / 45 years of consecutive dividend
BA: Boeing Co. / dividend yield 3.78% / 0 years of consecutive dividend
MMM: 3M / dividend yield 2.90% / 59 years of consecutive dividend
IBM: IBM Corp / dividend yield 4.52% / 21 years of consecutive dividend
MSFT: Microsoft / dividend yield 0.86% / 11 years of consecutive dividend
INTC: Intel Corp / dividend yield 2.38% / 1 years of consecutive dividend

Yellow group stock dividends paid anomaly

PEP: PepsiCo / dividend yield 2.77% / 49 years of consecutive dividend
KO: Coca-Cola Co. / dividend yield 2.98% / 59 years of consecutive dividend
WMT: Wal-Mart Stores / dividend yield 1.54% / 45 years of consecutive dividend
DIS: The Walt Disney Company / dividend yield 1.42% / 0 years of consecutive dividend

How Many Stocks Do You Need for Monthly Dividends?

You can build a monthly dividend portfolio with 3 stocks. Pick 1 stock from each color of group!

Here are some examples:

MO: Altria / approximately$49.78 per share
T: AT&T / approximately$29.23 per share
CVX: Chevron Corp / approximately$107.59 per share

Let’s assume that you purchased 6 shares of Altria, 11 shares of AT&T, and 3 shares of Chevron Corp stocks. It will be a $942.98 investment.

With the $942.98 investment, you’ll earn $5.16 from Altria, $22.88 from AT&T, and $16.08 from Chevron Corp a year. (Total $44.12 a year)

Wrapping Up

I hope these guides help you build a monthly dividend portfolio! Remember, you still need to pay taxes on the dividend income. And don’t pick a stock based on dividend yield. If the stock price itself dropped, you’ll lose investment money. Moreover, there will be tax for dividends paid from companies outside of the country you live in.

Always do some research before you invest money!

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