Blue Ice Data Graph Finance
Fig 5.0: The Compound Slope

The Dividend Snowball Projector

Term Definition
The Dividend Snowball is an investing strategy where dividends are automatically reinvested (DRIP) to purchase more shares, which then generate even more dividends, creating an exponential feedback loop of passive income.

Most people work for money until they die. The wealthy build machines that print money. Dividend stocks are the simplest machine you can build.

The magic happens when you stop spending the dividends and start reinvesting them. Use the projector below to see when your Passive Income > Living Expenses.

// PASSIVE INCOME ENGINE
Projected Monthly Passive Income:
$0.00

The Math of "Quiet Wealth"

Unlike Crypto or Tech Stocks, dividends are boring. Boring is good. Boring makes you rich. If you invest in "Dividend Aristocrats" (companies that have raised payouts for 25+ years), you get a raise every single year without asking your boss.

The Crossover Point

Your goal is the Crossover Point: The day your monthly dividend check ($2,000) exceeds your monthly mortgage/rent ($1,900). Once you cross this line, you are financially invincible.

Investor FAQ

What is a good dividend yield?

Generally, a safe yield is between 2% and 5%. Anything above 7% (Yield Trap) usually indicates the company is in trouble and the stock price is crashing.

Should I use an ETF or single stocks?

For most people, a High-Yield ETF (like SCHD or VYM) is safer and requires zero maintenance.

Sources:
1. Siegel, J. (2002). Stocks for the Long Run. McGraw-Hill.
2. S&P Dow Jones Indices. (2024). Dividend Aristocrats Methodology.

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