Dividends4Life: Measuring The Success Of Your Dividend Portfolio

Dividend Growth Stocks News

I have given this article the same title as that of a recent article on Morningstar. The subtitle to Morningstar's article was, "Worry less about beating the benchmark and more about dividend growth and achieving your desired outcomes, says Morningstar's Josh Peters." I agree with that statement completely, and it was what enticed me to read the whole transcript. I would like to go through some of that article and show where I agree and disagree with Peters' remarks. All indented quotes in this article are Peters' words from the interview.

"Benchmarks are important. To be able to compare your returns over a long period of time against, say, the S&P 500 is not a bad idea because that's sort of a default option that you can get with very low cost. If, over a very long period of time, you're taking just as much risk as--or more than--the S&P 500 and not getting as much return, then maybe you should just index. So, for active managers everywhere who are sort of under siege, that is what you have to do. You have to add some value either with less risk or more return or preferably both." I do not place much weight on measuring the total return of my dividend growth investing against benchmarks, because total return is not my goal. Instead, my goal is to produce a sufficient, reliable, rising stream of income. The endgame is to be able to live off that income in retirement.

Source: Seeking Alpha

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