For many people thirsting for freedom, dividends from share savings are the strategy and source of passive income on which to build freer years. But what does access to dividend income requirements, and how can they begin to replace the income from paid employment? This article provides perspectives on dividend investing and calculations on how dividend income could be used to fund a freer life.

Note. The corona crisis has had a significant impact on the economy and the companies’ operations/results. The payment of dividends in 2020 was postponed for some companies and also shortly it may be difficult for some companies to maintain the usual level of dividend payments. However, when share prices fall, it is a good time to make deliberate new acquisitions of shares or funds.

Dividend income, what are they and how can they be obtained?

Dividends paid to shareholders are one of the most attractive and passive ways to generate investment income. The dividend payment of stable dividend companies approximates the “certainty” of fixed income investment and therefore many build their investment plan based on the dividend payment.

The dividend payment and the amount of the dividend are one criterion and indicator for the investor in the selection of shares but by no means the only one. Another key strategy is to invest in the company with confidence in its value growth and growth potential.

Increasing their investment plan and (financial) freedom can be strategically built right around dividends. By combining dividend income with minimizing consumption, you can gain more freedom in your life, even in a relatively fast period. It is worth exploring the potential of dividend income, even if there are no large savings or income available.

Popular domestic dividend companies typically pay about 4-5% stable and often also annual dividends. At their best, companies distribute dividends of up to 6-8% of their earnings to their owners, some foreign companies even more so.

The amount of the dividend is expressed in euros on earnings per share and the dividend percentage lives about the current share price. The dividend can be, for example, 10 cents/share or 2 € / share, in which case the dividend percentages help to compare the companies’ dividends.

However, it is not advisable to hunt for the hardest dividend percentage alone but to try to find out more comprehensively the viability of the company and the fact that the dividend payment is at a sustainable level about the company’s result. Part of the company’s result should be used for investments related to the company’s development and to prepare for downturns.

If the company’s earnings per share were, for example, € 2, the company can outline that half of that amount, ie € 1, will be paid back to the owners as profit distribution and the other euro will be set aside for the company’s development.

The dividend will thus be paid to the shareholders as a profit distribution from the result of the previous financial year per owned share, as determined by the Annual General Meeting. Companies usually pay their dividends once or twice a year, although the shift to quarterly dividends is also becoming more common. To receive a dividend, you must be a shareholder on the day before the dividend is released.

company who pays bets divident

Foreign companies more often pay quarterly dividends or even monthly dividends. In any case, the reward for the money you invest will come back to your account in the form of a dividend payment.

This regular cash flow from dividends is, therefore, more important to the dividend investor than the expected increase in the value of the share. The share value of good companies is usually bullish, but they are less likely to be real price rockets after all. Rather, good, stable value companies make consistently good results from year to year and decade to decade.

The logic of earning dividend income feels simple even for a beginner. It also seems less risky than starting to assess the potential for growth in the value of growth stocks and the right timing for both purchases and cash withdrawals.

For many, it pays to have a return to the account at regular intervals, and there is no need to worry more about stock value fluctuations. So quite easy and carefree, even passive, but not completely.

However, before the dividend cash flow can cover even part of the cost of living, you need to have a fairly large portfolio together. For many, this means that active work must be done before these passive incomes can be enjoyed. Fewer are those for whom a larger initial capital pops up from some of the wealth of the family or elsewhere without their effort.

Usually, therefore, the money to be invested is first acquired by doing and saving work, ie the active work has been done in advance. Once your work is done, it’s time to put the money to work. Work was done in advance and your own choice to transfer part of the income to investments instead of consumption are therefore prerequisites for dividend income.

Before you go into stock shopping, of course, it’s a good idea to make a little effort with familiarization and information retrieval. After starting, some of the portfolios must of course be serviced annually, but the workload is quite small compared to, for example, housing investment. It’s really up to you how much time and energy you spend around the topic. Cheering to financial news and course tracking can be quite a useful feature in this sport, but not a must.

Dividend investing, like all investing, always involves uncertainties and factors that are good to be aware of already at the investment planning stage. More about them in this post.

What resources are on your side?

The conditions for increasing dividend income, perhaps obviously, will be discussed in a little more detail. That is, the resources and cornerstones of investment that are needed to get dividend investing on its path up and running.

At the same time, you can think about how these will be realized for you, what you could better optimize, and on what resources you will build your plan in particular.


The starting point for any investment is, of course, that you can and dare to put capital on investments and can also continue to make investments for a longer period to increase your stockpot.

If there is plenty of capital available, substantial dividend income can be enjoyed quickly.

The larger start-up capital can be the result of savings or home sales, perhaps inheritance or gift money. If there is some kind of start-up capital in use, you can taste the results faster and the goals don’t seem so far-fetched.

Surplus economy

However, a lack of start-up capital does not in itself hurt anything, as long as there is even a somewhat surplus economy. And this is certainly one of the most important conditions for investing.

The amount of the monthly surplus, on the other hand, can be controlled either by reducing its consumption or by increasing earnings. The greater the motivation, the easier it is to prioritize investing in one’s future and compromise on other, perhaps less necessary, consumption. The decision to want to transfer some of the money spent on consumption to investments is a good starting point.

The sooner you like to enjoy the freedom and return on investment, the bigger slice of income should be pushed into the stock market every month (or a few times a year). However, any amount starting as early as € 20 a month is the beginning of where to start.

The acquisition costs of shares in Nordea and Op, for example, are 1% in small purchase installments, so it is not necessary to buy shares in larger quantities at a time. Alternatively, small savings can be put into funds that follow the index, for example.

The best thing is when you budget for each month the amount you want to put in to accumulate your investments. And then adjust its consumption to the rest.

Regular additions to the portfolio keep assets and dividend volumes on an upward trend and take care of time diversification. Seeing the development motivates you to continue and think about how your economy’s surplus could still increase. The positive hook begins to develop.


Time will have a significant impact on the dividend investor’s return growth, so it is not advisable to postpone the start. If there is little invested capital or a monthly surplus, time will compensate and do some of the work.

Time will inevitably pass, however, and at the same time, it will act as a lever for investment growth. The interest rate increase comes to the dividend investor when all or part of the dividends are reinvested. However, more than 10 years of reinvestment is needed for the interest-to-interest effect to begin to work effectively.

Thus, even with a small monthly saving, a young person can build a plush portfolio of freedom or wealth to secure future choices. A wealth of one million euros is much easier to realize for the twenties than for a beginner at the age of 40. With age, therefore, stakes must be increased so that wealth grows and the results can be enjoyed. Yet it is always better to start than not to start.


There is quite a bit of talk about the power of attitude when investing, but with your attitude, determination, and inspired optimism, you can achieve a lot. Even compensating for the scarcity of other resources.

Unfortunately, many hit the gloves on the counter even before they even started. Especially with small monthly savings or a challenging economic situation, you may not even feel the opportunity to achieve results worth the effort and risk. The goal feels distant and cynicism strikes.

Potential problems in one’s finances must be overcome at least first before one can start with targeted savings and dividend investments. But even with very small incomes, it is possible after that to start building a new rise and growth in wealth. Everything accumulates. There is nothing wrong with getting dividend income up to an average of € 5 a month.

If, on the other hand, it is the case that every euro whose investment is a source of joy and proof of the possibility of passive income will easily encourage it to continue. And if there is no hurry, the time and interest for interest phenomenon do their job in increasing the investment capital, as well as the cash flow from it.

That is, while spinning tens and hundreds may frustrate a beginner, the attitude is worth adjusting toward faith and optimism. Even small steps in the direction of one’s own goal can trigger new kinds of thinking and prioritization, which start to take us surprisingly forward.

Attitude and goal-setting together have big effects. Changes in one’s interests, mindset, and choices together gradually form an additional lever with which things start to accelerate and the rounds increase. This affects returns and is also part of total income, which includes your internal wealth and intellectual assets.

Two different lines of dividend strategy

A dividend investor can utilize dividends roughly divided into two different ways, depending on whether the goal is to increase wealth or cash flows that can be introduced a little faster. Simply put, the question is whether the goal is to get a lot of money in the long run or less money, but with quick access.

Dividends can thus be part of a long-term investment plan, in which case they are hardly raised, but are reinvested from year to year with the interest-rate effect, leverage that significantly increases wealth over the years.

In that case, the goal is somewhere over 10 years, or even over 20 years away. The goal may be to retire a little earlier than usual and assets that can benefit in their retirement days, but also leave something for future generations. This is, of course, purely mathematically the model that will lead to a higher result in euro terms.

In the second line, the focus is on cash flow and passive income over a shorter period. Regular dividends thus mean income that can be used as you wish.

Dividends can perhaps shorten their working week, fund an extra month or two of vacation a year, allow for a transition to entrepreneurship, or build a severance fund for themselves. Use them in this way to promote freedom in a shorter span.

Even in this shorter-term model, it may be a good idea to try to reinvest dividends for even a few years, mainly to get the interest rate to take effect.

Dividend investing can be thought of as forming a gradually growing slice of one’s livelihood, offering one interesting opportunity to create a freer life and at the same time studying equity investing. In this case, it may be a good way to reinvest at least part of the dividends and, as the portfolio grows to the desired size, start using dividends on living expenses.

It is a good idea to explore with an open and courageous mind how a dividend strategy would serve your situation and freedom goal. And start creating a plan from that starting point.

Risks and attitudes towards them

The risk associated with equity investing and the uncertainty about one’s own investment decisions forms the threshold for many to start. What if you lose the money you have invested or the thing doesn’t work as you hoped and calculated?

Indeed, risks and stock market fluctuations must, of course, be considered and be with you. Everything probably doesn’t go completely straightforward, let alone in a Strömsö way. However, the level of risk can also be influenced by oneself and the attitude that the market is not stable, but that ups and downs are always in the picture.

The value of the shares and the number of dividends can thus fluctuate, sometimes considerably. The dividend payment can also be stopped or cut for some time for a good reason (e.g. Korona). There is no guarantee that the company will guarantee a good result from year to year and pay high or annually increasing dividends. The market’s appreciation or lack of appreciation for a company is sometimes unpredictable. However, a longer period helps to deal with momentary fluctuations calmly.

It is quite rare that several listed companies, or at least the ones they have invested in unexpectedly, would collapse, at least at the same time, taking their money with them. It is good to monitor the market and the political climate and be prepared to make transfers if necessary.

Traditional dividend-paying stable value companies are less vulnerable to market turbulence and their value fluctuations are often smaller compared to growth companies. Although the dividend strategy, like all investments, involves risks, they are offset by a long investment period and considered diversification. Downturns can be exploited by increasing their holdings as share prices fall.

It is essential to internalize that the downturn is always followed by a rise, and too much flirting is often not worth it. Nothing is lost (or won) before the shares are sold. Even in a downturn, dividends are usually paid, based on the previous year’s result. However, the Korona year brought exceptional solutions to this as well.

It is a good idea to weigh your risk tolerance in advance. Uncertainty is best alleviated by studying the topic adequately, following the market, getting involved, and starting to understand the logic of the market.

Experience and doing gradually brings certainty and helps with risk management. One can think that the knowledge gained by reading and doing is part of the capital and at the same time the reduction of risks and huts.

1. Strategy – Aim to live on dividends

I note that the following examples and calculations are only indicative variations on the subject. However, they help to outline different options as well as how much capital could generate a passive income that would cover all or part of your monthly spending.

Starting point: you want to be able to cover your mandatory expenses in the future entirely or mainly with passive dividend income, and you are not currently in a hurry to get out of work or need to be lightened.

What, then, is a sufficient amount of dividends will, of course, depend on what standard of living you want to maintain and what your mandatory or desired monthly expenses are.

Someone wants wage income to replace the number of dividends and maintain the usual level of consumption. For some, it is enough to make ends meet on even lower incomes, with freedom compensating for the fall in income levels.

Let’s start with the minimum principle, ie what monthly income would make it possible to cover one’s expenses in a freer life and what kind of capital it would mean when invested in the stock exchange.

Assume that the target is a dividend income of € 1,200 per month, ie a dividend of € 14,400 per year. However, to reach such a situation, a considerable amount of investment capital is already needed.

The best dividend companies on the Helsinki Stock Exchange pay up to 6-7% dividend (the level varies depending on the market and the share price), and there are tougher dividend payers in the world.

Assuming that you receive a 6% dividend yield on your shares, you will need a capital of € 240,000, which will generate these € 14,400 annual dividends, or about 1,200 / month (gross).

Here is an example calculation of how € 240,000 of capital accrues interest on interest with the help of the phenomenon, at what time, and how much equity is needed.

Taxation of dividends

At this stage, taxation must be included in the calculations. The taxation of dividends depends on whether the shares are purchased in a book-entry account or a new share savings account.

The tax rate on dividends paid to the book-entry account is 25.5% when the capital income is less than 30,000. The tax rate consists of the fact that 15% of the dividend paid is tax-free and the remaining 85% is taxed according to your capital income rate (30-34%). Dividends are thus taxed slightly lighter than other capital gains.

Taxes from the book-entry account are taken from the account immediately after the dividend payment. If, on the other hand, a new equity savings account is launched at the turn of the year, there is no need to pay tax on dividends until the money is withdrawn from the account, ie the interest-to-interest phenomenon is made more effective. But on the other hand, a normal capital tax of 30 (-34)% is then paid on the income share when the money is repatriated.

In the shorter-term investment, where dividends are mainly introduced, the book-entry account is better for tax purposes. Interest on interest, on the other hand, comes from share savings account with a longer investment span. 

By taking advantage of tax deductions, ie by declaring all expenses related to investment activities in the tax return, the effect of taxes will be smaller.

Let’s still look at that example calculation with taxes in mind. The goal is therefore a € 240,000 portfolio and € 14,400 in dividend income/year.

  • The size of the portfolio is about 240,000 €
  • Equity in the investment: approx. € 148,600
  • Interest income: approx. € 92,268
  • Portfolio saving period: 15 years
  • Annual dividend income, 6% with default: approx. € 14,400
  • The share of taxes is € 3,672 -> € 10,728 remains

After taxes € 894 / month (shares in book-entry account)

-> Up to 100% of mandatory monthly expenses covered

In a double economy, a monthly budget of about € 1,800 is the amount you can live in comfort in Southeast Asia, Eastern Europe, and Finland, and the extra runners will be cut. Even a single person can do well for € 894 / month, living on a budget-conscious basis.

It is, of course, difficult to assess price developments in different parts of the world well into the future, but in the light of current price levels.

For myself, just living on a trip and appreciating freedom after the symptoms of exhaustion have struck has shown how well a person can cope with a small monthly budget.

Preferably, the amount of about € 900 left in the example is thought of as the basis of livelihood, on which one can only live, but on the side of which other sources of livelihood can be constructed without stress, with the help of which the monthly usage amount can be increased.

If, on the other hand, you feel that you need a larger dividend pot for your monthly expenses, such as even € 1,500 net, you are already talking about a portfolio worth almost € 500,000. The pursuit of a portfolio that hurts hundreds of thousands can seem quite distant to the average employee leaving from scratch. It is worth dimensioning your own goal so that it fits your situation and life values.

Raising capital

The target capital of € 240,000 is quite large for most. Reaching such sums usually requires years of active saving & investing, at least on average (salary) income.

When accumulating capital, it is essential to invest in shares on a long-term basis and to reinvest dividends received over the years. Consequently, that initial share of equity may, of course, be significantly lower.

The interest-to-interest effect combined for a sufficiently long period is what generates a significant capital increase. For investments of less than 10 years, the effect on interest rates is still relatively small.

Fortunately, more freedom and independence in life can also be built on models where only part of the income is passive, and such models are more accessible and achievable in the shorter term.

2. Strategy – Dividend cash flow into a freer livelihood

Starting point: Your goal is to get to enjoy the freedom and cash flow of dividends faster. Suitable for you who need to reduce, lighten or change your job description in a more unique direction in the short term. The dividend strategy can also be used as part of the financing of a freer life, for example by acting as the following example and forgetting visions of complete financial independence.

Consider a situation where you would be able to invest (for example, by saving and/or selling a larger property, such as an apartment) in a total of 2-3 years, so that you have a total capital of € 60,000 in shares.

If your account has a larger savings amount in size or a cash flow from the sale of a home, you will get a faster start to this dividend strategy. However, it is not advisable to postpone the whole pot at once to the stock exchange but to act in peace, decentralized over time, between industries and also geographically.

In the portfolio, you would acquire tough dividend payers from both Finland and the world. The initial investment should already be diversified into at least a year-round and perhaps even later, saving.

In the first years of savings before you start using dividends on the cost of living, you would reinvest the dividends in the stock market, however, this would give you some interest on the interest rate.

The calculation on a three-year schedule could go this way. The calculation is based on the idea that a larger initial investment pot, such as 30,000, would be used at the beginning, which would be spread over the savings period, adding other monthly savings.

Suppose that when the portfolio then reaches the € 60,000 threshold for the shares you have acquired, that relatively excellent 6% dividend would be paid. Your dividend income would thus be € 3,600 per year.

Calculation including taxes:

  • Portfolio size € 60,000
  • Equity in the investment: approx. € 53,500
  • Interest income: approx. € 6,500
  • Savings period: 3 years
  • Annual dividend income, 6% with default: € 3,600
  • After taxes € 223.5 / month (shares in book-entry account)

-> About 25% of mandatory monthly expenses covered

It may sound small compared to the stakes. However, this is the completely passive income and the income that increases your independence.

Covering the monthly expenses of € 223.5 can already be quite a significant amount. When traveling and living in low-cost countries, this can mean a 25% share of the funds needed per month, with an operating budget of € 900 / month, as in the previous example.

The rest of the budget, 75% of monthly expenses, can then be covered by more active income, freelance work, online entrepreneurship, or teleworking in a place-independent lifestyle. Which is best for your situation.

There is no impossibility to earn a net income of € 675 on dividends in the ways mentioned above and thus get to live more freely and voluntarily quite quickly.

With a combination of dividend income and laptop work, you can already relatively quickly create an independent, traveling lifestyle without having to run the squirrel wheel of paid work for the next 15 years.

Note again that the sums in the example are therefore starting levels that nothing prevents you from increasing up if you want. It is important not to make the threshold too high for yourself at the beginning by setting yourself, for example, € 3,000 in monthly income requirements if the primary goal is to increase freedom.

I have chosen this kind of approach 2. Strategy. For the time being, my dividend income only covers about one month’s expenses on an annual basis. However, buying and selling stocks and funds has brought other room for maneuver and independence to my economy. Dividend income is currently one small slice of my freedom strategy.

When dividend investing is of interest – pay attention to these

Before you begin:

  • You have considered your own goal, why you want to increase your passive income, what it will allow you to do, and when you will start using it to enable a freer life.
  • You are willing to transfer funds from consumption and/or savings to investment
  • You have weighed the risks associated with investing
  • You have selected the appropriate data sources to monitor the market and evaluate the companies
  • You’ve wondered how often and actively you want to monitor and maintain your portfolio

Selection and repurchase of shares

  • Note that stable long-term value stocks are a relatively safe choice, their dividend is moderate but often growing annually and thus a good choice in the long run
  • Although history is no guarantee of the future, it is worth checking the historical development of the company’s dividend payment
  • In stable companies with a moderate dividend level, the dividend payment is on a fairly stable basis even in a declining market and even in recession years.
  • Check how much of the profit / share the company distributes as dividends, the higher the share paid out, the higher the level of risk may also be
  • A reasonably good dividend level (3-4.5%) is a signal that the company does not pay out all its income as dividends but also has sufficient funds left for investments and the buffer.
  • Companies with a high dividend level and therefore attractive (7-9%) take into account the higher risks and try to choose this category of companies that operate on the safest basis if at all you want to take higher risk diversification into your portfolio, these are REIT and BDC (business developing company) companies, both of which involve interest rate risk
  • Choose stocks from different industries, preferably so that you understand at least to some extent their business logic, market position, and future prospects
  • Also, diversify geographically by selecting not only domestic companies but also foreign companies or funds / ETFs where geographical decentralization takes place
  • Investigate if you can find good dividend companies that are undervalued or otherwise below the target price, or buy companies you know from market dips
  • Keep costs moderate, preferably max 1% of the value of the purchased item
  • You may also want to keep track of what kind of portfolios successful long-term dividend investors have and consider whether you want to pees their solutions in some choices.

Once you’ve started:

  • Explain to yourself how often you monitor, replenish and maintain your portfolio
  • You can take supplements, for example, monthly or preferably at least a few times a year
  • Decide how you will deal with the dividends paid, whether you will immediately reinvest them in the same stock using a dividend dip, disperse over time or some other tactic, or take part
  • Decide on the criteria for selling and switching companies in your portfolio
  • Decide how you track your progress, how you record your annual dividend growth, seeing developments still motivate you to continue and hone your strategy for the better

How would living with dividends work?

If part or all of the livelihood were to come from dividends, how would that happen in practice? After all, Finnish companies pay dividends, with some exceptions, mainly in the spring. Sure, some companies pay more than once a year.

This means that the full financial year would take place mainly in the spring over about three months. The account bag itself should be divided into items suitable for the coming year to be withdrawn. Especially if it is about the main livelihood of the whole year.

I would act as a transfer of dividends to the account, either in whole or in part, to a slightly better interest/return account, or perhaps to a fund, from which I would then mobilize the required amount monthly. I would probably place a part of the pot right away for me and I would try to snap even a little extra income from here and there.

If you then want a more even cash flow throughout the year, you can turn your gaze behind the crap to Yankee stocks, many of which pay dividends either quarterly or some even monthly.

The monthly dividend payment is offered by several American REITs, ie real estate investment companies. Some of these have a history of uninterrupted dividend increases of more than ten years and dividend percentages can fluctuate as high as 7-9%. Such companies may be a good way to diversify the dividend portfolio, as long as you are also aware of the risks associated with the companies and choose those that are less risky.

If, on the other hand, you have decided to invest some or even all of your savings in funds, in which case the dividends are always reinvested within the funds, once the target capital is reached, you can act to raise a “dividend percentage” of money from the fund.

This can be done even by selling fund units a few times a year. At this stage, a capital tax of 30 (-34)% is paid on the fund’s return.

Pros and cons of dividend strategies

What strategy should you choose then? From the point of view of increasing freedom, your resources, ie time, available capital, and savings rate, as well as your own goal, influence your choice.

What is most financially sensible may not be the same as what is the best choice for you. Your situation is always the starting point to which different options to mirror and apply.

Here we have summarized the advantages and disadvantages of the two long-term and short-term models described above.

Dividend-based livelihoods (Strategy 1)

By saving on wage income, it may not be possible to throw in dividends until 15-20 years from now, especially if an amount of dividend income is sought to replace current wage income. So let’s talk about a fairly long-term strategy and possibly the pursuit of financial independence.

Choosing this line requires that you can withstand a long time in working life and find even a more distant goal inspiring. However, the dreams of freedom must be moved far ahead. Unless otherwise successful in raising large capital to invest in the stock exchange.

However, there are several strengths to the long-term strategy. Not only that, it is economically efficient and the so-called orthodox, it can use funds instead of or alongside direct stock purchases. This can make a lot of sense for capital growth when dividends are not needed for years to come.

The benefit of saving in funds (growth units) is that the dividends are reinvested within the fund, and the tax only has to be paid when the fund unit is redeemed in due course.

In funds, diversification is also ready. The interest-to-interest benefit is fully utilized and saving is otherwise quite effortless. You just need to make sure the fund’s expenses don’t eat into your profits. A low-cost (less than 1% of expenses) or no-cost (index) fund is a worthwhile choice in this sense.

Another advantage of funds is that you don’t have to pay trading costs either, unlike if you reinvested the dividends yourself. The downside, however, is that someone else makes the decisions for you.

The new stock savings account also allows for the transfer of tax payments when you leave dividends in the account and make new stock purchases within the account. However, trading costs will be payable for each order.

Once the target capital and the amount of annual dividend income have been reached in due course, there may no longer be a need to stress on basic income. However, other income can be used to supplement this own “basic income”.


  • Due to the interest rate phenomenon, your capital can even multiply
  • The economic benefit is optimal due to the tax shift and the reinvestment of dividends
  • You can live to reach your goal even if you rely solely on dividend income
  • A long time compensates for exchange rate fluctuations and risk
  • You can and should take advantage of stock picking and fund saving in parallel


  • Living on dividend income only takes a long time; 10-20 years away, depending on target capital and pace of savings
  • Your income tax rate on dividends alone is 30-34%
  • Must be able to stay fully employed for a long time
  • Must be able to save a large monthly amount so that the portfolio grows at the desired pace towards financial independence
  • You have to compromise on your goal of freedom or get a job that feels free
  • The risk is if you have to move your life into a “tough” time

Quick cash flow from dividends as part of livelihood (Strategy 2)

The disadvantage of a tactic that focuses quickly on dividend income is that it lacks the full interest-to-interest benefit. Sure, his investment capital may grow too, but growth will be much slower than if dividends are reinvested continuously for more than 10 years.

Weakness is also the fact that larger lump sums have to be paid in equity. To reach the amounts mentioned in the example of the article in a short time, there must be some realizable assets or larger savings in the jam.

However, if you have been able to save tens of thousands over time, sell an apartment or get an inheritance, for example, a short-term dividend strategy is one possible solution. However, time decentralization should not be forgotten, but moderation should be invested in several installments.

A shorter-term goal is motivating when you know you will be able to enjoy passive income relatively soon. Saving a line crunch doesn’t hurt when the goal is important to yourself and it’s close enough.

A freer life, a faster schedule, and the opportunity to break away from paid work are the absolute benefits of this model. Soon, and not until 20 years from now!

Even in shorter-term tactics, it is worth taking the time to weigh your strategy, study equity investing, discuss with more advanced investors and get to know different industries and companies.

Of the account options, a book-entry account is perhaps the best choice in a short-term dividend strategy, using it to pay slightly less tax on your dividends than with a stock savings account. On the other hand, the joint strategy of both accounts can also be effective. With a stock savings account, you will initially receive dividends tax-free and be able to reinvest them in better positions.


  • Passive income fast
  • Motivate when the goal is close enough
  • Inspires to start building other sources of livelihood as well, directs to a faster process of change
  • The total tax rate is lower if, alongside dividend income, small wage or corporate income
  • A good option for those who value freedom over money and are exhausted from paid work


  • Equity relative to more stick to investments
  • Interest-rate time and the maximum potential for asset growth are largely lost
  • 75% (or more) of livelihood must be financed by other means
  • From a purely economic point of view, a worse and slightly riskier option


Disclaimer: The content of this article is not and should not be construed as investment advice. There is always a risk of losing capital when investing. Everyone must assess the risks from their point of view and take responsibility for their own financial decisions.

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