So I too follow Adriano and I am from the US. I have a couple of years to build my passive income portfolio. I have a few questions.
1. You said, sorry I should have wrote it down. You either live off 30-40% of your portfolio or invest that percentage back into your portfolio. The question I keep coming back to is, do you rotate your drip and pull cash out from the ETF that you need to live on and reinvest the balance of what you don't need?
2. Or how do you do this? I'd love to know how others do it.
3. How do you handle taxes? The same way. Take out a little each month and set it aside?
4. How do you address or get health insurance?
5. I'm still trying to find something that shows how much my portfolio will grow over say the next 4 years by dripping my divvys, so I can figure out when I can join all of you.
I'm so happy to have found like minded people and enjoy reading about their early retirement journeys. Hopefully I'll be there soon.
We don't have DRIP turned on - we manually choose what to invest in each month and spend 10 minutes buying funds, usually in the 3-4th week of the month. We always reinvest what we don't need.
3. This year was our first year filing a large amount of dividends without regular income, so we had no idea what to expect. It might be a smart idea to earmark some and it really depends on how much other income you're bringing in.
I'll tell you how our tax breakdown went this year:
$82k in dividends (~$36k in TFSA)
$23k in dividends from our corporation
All income was split 50/50 between the two of us.
We paid $0 in taxes.
In previous years, we had income coming in, but taxable dividends were only ever $30k-$40k split between us. I never felt shocked by a tax bill.
I can't say we are putting aside any this year either... our tax bracket is too low at this point to make it a big part of our strategy :) As a reminder, we are in Canada so it may differ.
4. We have MSP (medical services plan) through the province that covers things like doctors visits, hospitals etc. We don't have health insurance otherwise, we are healthy :) I pay for physio out of pocket, but it isn't much.
5. I answered this in your FB message! :)
Looking forward to you joining the Early Retirement Crew haha
So I too follow Adriano and I am from the US. I have a couple of years to build my passive income portfolio. I have a few questions.
1. You said, sorry I should have wrote it down. You either live off 30-40% of your portfolio or invest that percentage back into your portfolio. The question I keep coming back to is, do you rotate your drip and pull cash out from the ETF that you need to live on and reinvest the balance of what you don't need?
2. Or how do you do this? I'd love to know how others do it.
3. How do you handle taxes? The same way. Take out a little each month and set it aside?
4. How do you address or get health insurance?
5. I'm still trying to find something that shows how much my portfolio will grow over say the next 4 years by dripping my divvys, so I can figure out when I can join all of you.
I'm so happy to have found like minded people and enjoy reading about their early retirement journeys. Hopefully I'll be there soon.
Hey Kelly! So I think I just answered part of your question in FB Messages to answer q #5!
1 & 2. Right now we are only living off of the dividends in our taxable account, we leave the TFSA to compound. This diary might really help: https://open.substack.com/pub/tanessashears/p/how-we-live-off-monthly-dividend
We don't have DRIP turned on - we manually choose what to invest in each month and spend 10 minutes buying funds, usually in the 3-4th week of the month. We always reinvest what we don't need.
3. This year was our first year filing a large amount of dividends without regular income, so we had no idea what to expect. It might be a smart idea to earmark some and it really depends on how much other income you're bringing in.
I'll tell you how our tax breakdown went this year:
$82k in dividends (~$36k in TFSA)
$23k in dividends from our corporation
All income was split 50/50 between the two of us.
We paid $0 in taxes.
In previous years, we had income coming in, but taxable dividends were only ever $30k-$40k split between us. I never felt shocked by a tax bill.
I can't say we are putting aside any this year either... our tax bracket is too low at this point to make it a big part of our strategy :) As a reminder, we are in Canada so it may differ.
4. We have MSP (medical services plan) through the province that covers things like doctors visits, hospitals etc. We don't have health insurance otherwise, we are healthy :) I pay for physio out of pocket, but it isn't much.
5. I answered this in your FB message! :)
Looking forward to you joining the Early Retirement Crew haha
Thanks for sharing. Lots to think about
You're welcome! It's definitely a different take on investing.
Love this breakdown! Easy to understand!
Thanks Flynn 💛