My Vanguard High Dividend Yield ETF Crosses $1,000 In Forward Income (2024)

Since July 2020, I have been buying Vanguard High Dividend Yield ETF (VYM) on a weekly basis. I hit another threshold on March 14, 2022. A few months back, I crossed over $25,000 of Vanguard in my stock portfolio; well, this is different.

I officially crossed over $1,000 in projected forward income from VYM. How was I able to reach this dividend income threshold?

I started gobbling up shares of VYM back when the price was in the mid to upper $70s. I can remember just like it was yesterday, buying an ETF, simply because I wasn't sure what other chaos the pandemic would bring.

Fast forward to now... the S&P 500 is down 13% in 2022. VYM is surprisingly only down 3.65% so far this year. This is one of the reasons why I like VYM - this ETF is typically less volatile than the S&P 500.

It is worthy to note, they may not return or perform as high as the total market may do, but, occasionally, they do not fall as hard. I believe VYM returned approximately 24-25%, whereas the S&P 500 returned 26-27% in 2021.

VYM Composition

VYM holdings are 410 diverse stocks that pay a growing dividend. Yes, AT&T (T) stock was definitely removed from the portfolio, as they used to be a top 10 holding of the ETF within the last 2 years, but is not anymore. Here is a snapshot of the current top 10 stock holdings:

There are 4-5 dividend aristocrats right there, even dividend kings might I add. Literally decades of dividend growth in the top 10, with Procter & Gamble (PG), Johnson & Johnson (JNJ), and Coca-Cola (KO). Not the sexiest stocks, but stocks that get it done, are consistent and increase their dividend.

The dividend yields on this list range from 2.30% up to over 4.50% with Exxon Mobil (XOM), which is making a huge comeback. It is no wonder, though, that the dividend yield stands right now at 2.82%, based on the trailing 12 months, with around a 6.75-7.25% dividend growth rate.

That's the 1-2 punch combo. Would you agree? Share your feedback when you can.

My VYM Shares and how I got here

There is the evidence. The proof is in the pudding. I own over 324 shares of VYM since July 6, 2020. Literally, stacking shares on a weekly basis and reinvesting dividends on a quarterly basis.

To calculate how many per month and week I have been buying, let's start with time. I invested in VYM for 6 months in 2020, 12 months in 2021, and 2.5 months so far in 2022. That is 20.5 months or 106 weeks. Doing the math, I have been buying almost 16 shares of VYM per month or 3 shares per week.

Wow... it's incredible what keeping it going, not letting up, buying on the dips, etc., can really do for your dividend stock portfolio.

Owning 324 shares also means my milestone was hit for crossing $1,000 in forward passive income with VYM, using a trailing $3.10 in dividends per share. What will it take for me to hit $50,000? Well...

If I am approximately $15,000 away and the stock price has been $110, on average, I am 136 shares away. Given I have been buying 3 shares per week or 16 shares per month, I might be able to hit this by December 31, 2022. Literally, dividing 136 shares by 16 shares per month equates to 8.50 months.

Therefore, I should be able to reach the $50,000 investment goal by the end of the year, with possibly a little time to spare.

Conclusion on VYM

The big conclusion on VYM. Community, I can't stop massively building this dividend stock/ETF position. Here are a few of my reasons why I keep buying VYM:

1.) Volatility in this stock market and world. There is too much volatility between Ukraine and Russia. In addition, inflation and interest rates are in the front of the news, with a rate hike coming/underway. Therefore, VYM - buying a basket of stocks appeals to me.

2.) The dividend yield and dividend growth combo. I am looking for a better yield than the S&P 500. I don't need 4.5%-6.0%. I'd like a 2.50%-3.50% yield with a consistently growing income stream of at or over 7%. VYM has accomplished that, thus far.

3.) Goal to $50,000. All - I think it would be awesome to have a nice $50,000 position at VYM. From there, I may re-evaluate and build up another massive ETF position - such as VOO or even SCHD.

What do you the community think of Vanguard ETFs? If you were in the pursuit of financial freedom, which ETF is your go-to to maximize dividend growth and current yield? Share your feedback in the comments below on what you prefer to use to build passive income!

As always, good luck and happy investing. Thanks again for stopping by and continuing the financial independence pursuit!

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