Would you like to give yourself a raise? You can by simply investing in companies that regularly increase their dividends.
Dividend increases mean more money in your pocket. An increasing supply of dividends increases your income. You can use that increased amount of money for anything you wish, or re-invest it and earn more for years to come.
Here are some Canadian companies and their average dividend growth over the last 10 years:
18.2% - Canadian National Railway Company (CNR)
13.7% - BCE Inc (BCE)
11.4% - Enbridge Inc. (ENB)
11.1% - Fortis Inc. (FTS)
10.3% - Empire Company Limited (EMP.A)
Most investors understand that Total Return comes from the following two parts:
Total Return = Capital Gains + Dividend Yield
However Kelly Wright (author of Dividends Still Don’t Lie) describes the concept of Real Total Return as:
Real Total Return = Capital Gains + Dividend Yield + Dividend Growth
Now you can see that dividend growth is just as important as capital gains, and dividend yield. Invest in quality undervalued companies with excellent dividend growth and you will become a successful investor!
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