How To Track Your Dividends: The Ultimate Guide

As investors, there are many ways you can supplement your income. Investing in dividend-paying stock is one way to increase your earnings. The question is how to track your dividends? If this question is bothering you, then look no further. In this guide, we'll teach you how to track your dividends so that you can ensure that you're making the most of your portfolio.

What are Dividends?

A dividend is a payment that a company distributes to its shareholders from its profits or earnings.

What are the Benefits of Dividends?

Following are the benefits of investing in dividend-paying stocks:

Income Stream: Dividends give regular income, often every three months. This is great for investors who want steady money plus growth.

Stability and Predictability: Companies that pay dividends are usually older and stable. They use regular cash flow to pay dividends. This means you can count on the returns.

Tax Advantages: In many places, dividends are taxed less than interest income. This means more money for you after taxes.

Signal of Financial Health: If a company keeps paying or increases dividends, it shows they are doing well. This can make investors feel good about the company’s future.

Long-Term Growth Potential: Companies that pay dividends are often mature and well-established. Reinvesting these dividends can grow your wealth faster over time.

Portfolio Diversification: Dividend-paying stocks add variety to your investments. They can be mixed with other growth stocks. This mix can help during bad market times.

Flexibility: You can reinvest dividends to buy more shares or use the cash for other investments.

Why Use a Dividend Tracker?

In order to take full advantage of dividends, it is very important to know how to track your dividends. The following are the benefits of tracking your dividends:

  • You can track dividends received from each company.
  • Get an overview of how well your investments are performing.
  • Compare which stocks and funds are paying out more in dividends than others.
  • Have a clear idea of when you will be paid and how much.
  • Track the dividend history of a particular stock or fund over time.
  • Stay organized for tax time.

How do I track my dividends?

Tracking your dividends simply means that you are keeping track of the money you receive as dividends from your portfolio of stocks. You can track this information manually using a spreadsheet or an online platform such as TrackYourDividends.

What To Look For in A Dividend Tracker?

When choosing a dividend tracker, you need to ensure it is user-friendly and has the necessary features. Look for customizable charts and alerts for when dividends are paid out. It should also allow you to track multiple stocks or funds simultaneously. Make sure the platform is secure and reliable, and the dividend data is accurate.

The options presented in this article meet these criteria. The decision of which dividend tracking option to choose depends on your preference for customizability versus convenience.

TrackYourDividends (Online Platform)

TrackYourDividends Online Platform

TrackYourDividends is an online dividend-tracking platform. It helps you track your dividends in an easy and efficient way and has the following features:

  • Customizable charts
  • Alerts when dividends are paid out
  • Ability to track multiple stocks or funds at once

It also offers a secure and reliable experience. You can be sure that your data is safe. Additionally, the dividend data provided by TrackYourDividends is accurate and up-to-date.

Benefits

Using this, lets you link to your broker and get the needed dividend info from your portfolio, like the amount and date. You can also track the dividend history of specific stocks or funds over time. This makes it easy to keep your tracking up to date. You can also use the company's dividend screener to find new dividend stocks to add to your portfolio.

Downsides

The downside of this option is that you can't customize it. You have to use the charts and reports they give you. You can't make your own dashboard. Also, getting all the info for taxes might be hard. You need to export the data and do the calculations yourself. Plus, it costs $119.98 per year.

Wisesheets (Spreadsheet Add-On)

Track your dividends in Excel

Wisesheets is a spreadsheet add-on that helps you track your dividends easily. It has many features to make things simple. You can get dividend data like dividend yield, payments, stock financials, and key metrics for stocks and ETFs. This lets you have all the dividend and stock data you need right in your Excel or Google Sheets. No more wasting time copying and pasting data. With Wisesheets, you can track multiple stocks and ETFs any way you like.

Advantages

Wisesheets offers customizability and unlike online platforms, you can build dividend analysis dashboards any way you want. Here you can add charts, dividend data, and any other key metrics you would like in a single view. You can even get inspiration from user-made templates and customize them to your specific needs. You can also use Wisesheets to perform fundamental analysis by getting all the stock data you need and screening for potential stock investment opportunities.

Disadvantages

Building your dashboard might take some time, depending on what you want. You need to add the data and customize the look. But once it’s set up, updating with new data is easy. You can refresh your existing data with just a few clicks. However, you can't connect to your broker for portfolio info, so you have to enter that data yourself. Wisesheets costs $60 per year.

Dividend Screener – how to use it for better results?

Both dividend tracking options can help you find dividend stocks. But the key is knowing how to screen for these stocks. The best way is to look at the dividend yield. You get this by dividing a company's yearly dividend by its current share price.

Also, check the company's history of paying dividends. Look for any changes in important numbers, like earnings per share or revenue growth. This helps make sure you invest in companies that can keep paying dividends.

The Importance of Dividends with Real Life Examples

Dividends are often a big deal in investing but new folks sometimes miss out on them. They can bring in regular money and really boost what you earn over a long time. Here is a close look at why dividends matter with some real-life examples.

1. Steady Money

Dividends give a regular flow of cash, which is super helpful for retired folks or anyone looking for passive income. Companies like Coca-Cola (KO) and Johnson & Johnson (JNJ) have been paying dividends for ages, offering steady income no matter how the market is doing.

Example: Coca-Cola (KO) Coca-Cola has been paying dividends since 1920. In 2023, it gives about a 3% yearly dividend. So, if you own $10,000 of Coca-Cola stock, you get about $300 each year just from dividends, without selling any stock.

2. Growing Wealth

When you reinvest dividends, your money can grow a lot over time because of something called compounding. Reinvesting means you buy more shares, which then earn more dividends.

Example: Procter & Gamble (PG) If you bought $10,000 of Procter & Gamble shares in 1990 and reinvested the dividends, you would have a lot more money today than if you had not reinvested. This shows how powerful reinvesting dividends can be over time.

3. Financial Health

Companies that pay regular and growing dividends are usually doing well financially. Dividends show that a company has good cash flow and trusts in its future profits.

Example: Apple Inc. (AAPL) Apple started paying dividends again in 2012 after a long break. This showed that Apple had strong finances and extra cash. Since then, Apple has been increasing its dividends, showing continued financial strength.

4. Market Protection

Stocks that pay dividends can help cushion the blow during bad market times. Even when stock prices drop, dividends can still provide some return.

Example: AT&T (T) During the 2008 financial crisis, AT&T kept paying and even raised its dividend. Even though the stock price was all over the place, investors still got their dividends, giving some return during tough times.

5. Total Returns

Dividends make up a big part of the total return on investments. Over the years, a big chunk of the stock market’s returns comes from dividends and reinvesting them.

Example: S&P 500 Index In the past decades, dividends have made up about 40% of the total returns of the S&P 500 index. This shows that while capital gains are key, dividends are also a big part of overall investment performance.

Tips for Growing Your Dividend Income Over Time

Put your dividends back into your investments and keep an eye on how they are doing. This way, you can make sure your investments are getting bigger over time.

Spread out your investments. When you invest in different things, it helps reduce risk and lets you earn from different places.

Choose stocks that do not change price a lot. Stocks that do not go up and down too much are safer, so you can get your dividends without worrying about losing a lot of money.

Watch the dividend yield and the company's history of paying dividends. Check if the company usually pays the dividends they promise. This helps you invest in stocks that really give you the income they say they will.

Use compounding to grow your money. Compounding is when you reinvest your earnings, so each year you earn even more. This can create more income over time.

Conclusion

If you want to keep an eye on your dividends and grow your money over time, there are many ways to do it. You can use online tools or simple spreadsheets to track your dividend income. Keeping track of your dividends is key to building a good investment plan. By following the tips given before, you can make sure your investments stay safe and you get the most from your dividend income. Always remember to watch your dividends and check how your investments are doing over time to make sure they are growing.

Guillermo Valles
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Hello! I'm a finance enthusiast who fell in love with the world of finance at 15, devouring Warren Buffet's books and streaming Berkshire Hathaway meetings like a true fan.

I started my career in the industry at one of Canada's largest REITs, where I honed my skills analyzing and facilitating over a billion dollars in commercial real estate deals.

My passion led me to the stock market, but I quickly found myself spending more time gathering data than analyzing companies.

That's when my team and I created Wisesheets, a tool designed to automate the stock data gathering process, with the ultimate goal of helping anyone quickly find good investment opportunities.

Today, I juggle improving Wisesheets and tending to my stock portfolio, which I like to think of as a garden of assets and dividends. My journey from a finance-loving teenager to a tech entrepreneur has been a thrilling ride, full of surprises and lessons.

I'm excited for what's next and look forward to sharing my passion for finance and investing with others!

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