Scaling Passive Income: How I Grew My Forward Dividends by 60%+ in Two Years

As I'm writing this blog post, it's currently Tuesday, June 23rd. The temperature here in Central Wisconsin reached a high of 78 degrees Fahrenheit today, so I was eager to spend some time outside!

Digging into the topic of today, building wealth through dividend growth investing is often described as a slow, methodical process - a marathon rather than a sprint. The speed at which this engine fires is heavily influenced by strategy, discipline, and consistent capital allocation.

Looking back at my portfolio data from June 2024 to June 2026, I am pleased to share that I have achieved a significant acceleration in my passive income stream. Over this two-year window, my net annual forward dividends surged higher by 62.8%. More specifically, from June 2025 to June 2026 alone (the latter blog post will be out next week), I saw a 28.7% increase, with my projected annual income rising from $6,035 to $7,765.

Achieving this level of growth requires more than simply holding "blue-chip" stocks. It takes a focused strategy. Here is how I moved the needle.

1. Prioritizing Dividend Growth And Quality Over High Yield

One of the most common pitfalls for income investors is yield chasing. That's buying stocks with unsustainable, sky-high dividends (generally, anything coming close to a 10% yield isn't viable). By leaning even more into companies that retain the majority of their earnings and that have a demonstrated history of dividend growth, I haven't had a dividend cut since Medical Properties Trust slashed its dividend in August 2023.

In dividend investing, it's arguably just as important to not go backward as it is to receive generous payout raises. Along with my preference to balance income with capital appreciation, this informs why I constructed the underlying holdings in my portfolio to only pay out 45% of their expected earnings for 2026. The improved growth from this capital retention strategy gives my portfolio much better total return prospects than static high-yielders.

2. Aggressive Capital Deployment and Dividend Reinvestment

Of course, growth at this pace isn't possible through dividend hikes alone. Consistent capital injections are a must. During these two years, I consistently saved and invested anywhere from 50%+ to 70%+ of my after-tax income (typically at the very beginning of each month to automate my contributions). Since I have been investing for less than nine years now, my monthly capital contributions remain the driving force behind my compounding machine.

My capital velocity has especially picked up in recent months as my income has scaled more from my professional development. Along the way, I have also selectively reinvested my dividends back into whatever I viewed as the best opportunities at the time.

3. Sector Diversification

I have also been meticulous to not allow any one particular sector of my portfolio produce too much of my passive income. The energy sector (specifically midstream) is my biggest income contributor, contributing roughly one-quarter of my passive income. By diversifying more defensive holdings with tech-oriented dividend growers with my barbell strategy, I protected the portfolio against volatility.

This helped me to keep my cool through the selloffs over the last couple years without panic-selling, which kept mt capital working in the highest-quality companies the market has to offer.

Concluding Thoughts:

Reaching $7,765 in annual forward income has me knocking on the door of the biggest milestone for my portfolio yet: $10,000, which will mark the start of the journey from five figures to six figures. At my current pace, this is probably about a year away for me.

More important than the dollar amount, though, the portfolio is becoming self-sustaining. If one is looking to accelerate their own dividend growth, remember that the most important variables are the ones you control: your savings rate, your focus on companies that grow their payouts year in and year out, and reinvestment.

Discussion:

As you work toward your own passive income goals, what is the biggest controlled variable (e.g., savings rate or reinvestment) that has helped you maintain your momentum during market volatility?

I appreciate your readership and welcome your comments below!

Expected Dividend Increases for July 2026

As I'm writing this blog post, it's currently Tuesday, June 16th. The temperature here in Central Wisconsin is set to reach a high of 67 degrees Fahrenheit later today. That's quite cool for this time of the year, but I'll still take it!

Now that the month is more than half complete, now would be a good time to highlight the dividend raises that I received in June 2026. I'll also look ahead to the raises that I'm expecting for July 2026. Let's get into it!

Actual Dividend Increases for June 2026

Dividend Increase #1: Medtronic (MDT)

Medtronic announced a 1.4% increase in its quarterly dividend per share to $0.72. This was less than the 5.6% increase in the quarterly dividend that I was anticipating in this series' previous blog post.

Across my 13 shares of MDT, my net annual forward dividends grew by $0.52 from this dividend announcement.

Dividend Increase #2: Realty Income (O)

Realty Income declared a 0.2% bump in its monthly dividend per share to $0.2710. Since O hasn't yet elected to deliver its one bigger dividend raise for the year yet, this missed my expectation for a 1.7% raise to $0.2750.

My net annual forward dividends edged $0.918 higher across my 153 shares of O due to this dividend declaration.

Dividend Increase #3: UnitedHealth Group (UNH)

UnitedHealth Group announced a 5% raise in its quarterly dividend per share to $2.32. This was a bit below the 6.3% boost to $2.35 that I was predicting.

Across my 13 shares of UNH, my net annual forward dividends grew by $5.72 from this dividend announcement.

Dividend Adjustment: FedEx Corporation (FDX)

On an adjusted basis, FedEx raised its quarterly dividend per share by 4% to $1.22. On an absolute basis, this was lower than the prior quarterly dividend per share of $1.45. That's due to the recent spinoff of its freight business (FedEx Freight Holding Company). Overall, I do believe that this will unlock more value for shareholders. Along with the impact on my passive income being minimal, I don't mind this move.

My net annual forward dividends decreased by $3.68 due to the dividend adjustment across my four shares.

Expected Dividend Increases for July 2026

Expected Dividend Increase #1: Cummins (CMI)

The first payout boost that I'm expecting for July 2026 will be from Cummins. My best guess is that CMI will declare an 8% hike in its quarterly dividend per share to $2.16.

Across my five shares of CMI, my net annual forward dividends would grow by $3.20 from such a dividend declaration.

Expected Dividend Increase #2: Duke Energy (DUK)

The next dividend raise that I'm anticipating for next month will come from Duke Energy. I believe that DUK will announce a 2.5% increase in its quarterly dividend per share to $1.09.

My net annual forward dividends would edge higher by $0.60 across my six shares due to such a dividend announcement.

Expected Distribution Increase #3: Enterprise Products Partners (EPD)

The third distribution increase that I'm expecting for July 2026 will be from Enterprise Products Partners. My guess is that EPD will declare a 0.9% increase in its quarterly distribution per unit to $0.5550.

Across my 275 units of EPD, my net annual forward distributions would rise by $5.50 from such a distribution declaration.

Expected Distribution Increase #4: Energy Transfer (ET)

The next distribution bump that I'm predicting for next month will come from Energy Transfer. My best guess is that ET will announce a 0.7% increase in its quarterly distribution per unit to $0.34.

My net annual forward distributions would grow by $2.07 across my 207 units of ET due to such a distribution announcement.

Expected Dividend Increase #5: JPMorgan Chase (JPM)

The fifth dividend raise that I'm anticipating for July 2026 will be from JPMorgan Chase. I believe that JPM will declare a 6.7% raise in its quarterly dividend per share to $1.60.

Across my six shares of JPM, my net annual forward dividends would rise by $2.40 from such a dividend declaration.

Expected Dividend Increase #6: NNN REIT (NNN)

The next dividend increase that I'm expecting for next month will come from NNN REIT. My guess is that NNN will announce a 3.3% bump in its quarterly dividend per share to $0.62.

My net annual forward dividends would jump $5.76 higher across my 72 shares due to such a dividend announcement.

Expected Dividend Increase #7: J.M. Smucker (SJM)

The seventh dividend raise that I'm predicting will be from J.M. Smucker. My best guess is that SJM will declare a 2.7% increase in its quarterly dividend per share to $1.13.

Across my three shares of SJM, my net annual forward dividends would inch $0.36 higher from such a dividend declaration.

Expected Dividend Increase #8: Union Pacific (UNP)

The next dividend increase that I'm anticipating will come from Union Pacific. I believe that UNP will announce a 5.1% raise in its quarterly dividend per share to $1.45.

My net annual forward dividends would rise by $2.52 across my nine shares of UNP due to such a dividend announcement.

Expected Dividend Increase #9: Wells Fargo (WFC)

The ninth dividend raise that I'm expecting will be from Wells Fargo. My guess is that WFC will declare an 11.1% hike in its quarterly dividend per share to $0.50.

Across my eight shares of WFC, my net annual forward dividends would grow by $1.60 from such a dividend declaration.

Expected Dividend Increase #10: Essential Utilities (WTRG)

The final dividend increase that I'm predicting will come from Essential Utilities. My best guess is that WTRG will announce a 5.1% raise in its quarterly dividend per share to $0.36.

My net annual forward dividends would edge higher by $1.462 across my 21 shares of WTRG due to such a dividend announcement.

Concluding Thoughts:

My net annual forward dividends grew by $3.478 in June 2026 (not counting downward adjustments in ADR dividends from a stronger USD as of late). This would be equivalent to investing $115.93 at a 3% net dividend yield.

If my 10 dividend raises that I'm expecting for July 2026 play out as anticipated, my net annual forward dividends would climb $25.472 higher. That would require investing $849.07 at a 3% net dividend yield to replicate.

Discussion:

How has your June 2026 been for dividend raises thus far?

Did you or do you expect to receive any first-time dividend hikes this month?

Thanks for reading and please feel free to comment below!

July 2026 Dividend Stock Watch List

As I'm writing this blog post, it's Tuesday, June 9th. The temperature here in Central Wisconsin reached a high of 84 degrees Fahrenheit earlier today with a sunny forecast, so I was glad to spend some time outside.

Now that my stock purchases are largely complete for June 2026, I will be looking ahead at the dividend stocks on my watch list for next month. Let's dive into it!

Dividend Stock #1: Brookfield Asset Management (BAM)

The first stock on my watch list for July 2026 is Brookfield Asset Management. Interested readers can check out my May 2026 Stock Watch List blog post or my recent Seeking Alpha article for my investment thesis.

The crux of my investment thesis is that BAM's $67 billion in fundraising leading up to its Q1 2026 earnings call shows that its secular-driven growth isn't slowing down. This is because more institutional and retail investors are increasing their allocation to alternative assets for their returns, low correlation with stock and bond markets, and portfolio diversification. That's driving the forecast for upper-teens percentage annual distributable EPS growth over the next several years.

The 4.3% dividend yield (from the current $47 share price) modestly exceeds the forecast for distributable EPS for 2026. However, the payout is reasonably protected by steady cash flows (87% of fee-bearing capital is long-term or permanent), capital-light business model, and $2.5 billion in corporate liquidity against no debt maturities until 2030 (and an A- S&P credit rating). This gives BAM the confidence that it can deliver 15%+ annual dividend growth.

Appraising the alternative asset manager as a yield vehicle with a growth kicker, shares are trading 18% below my updated fair value per share estimate of $57. This assumes a fair value yield of 3.5% for BAM, which is arguably reasonable even in an elevated rate environment. That's because, while it comes with risks, it offers the potential for significant passive income growth over time. In my opinion, the same simply can't be said about bonds.

Dividend Stock #2: Genpact Limited (G)

The next stock on my watch list for the month ahead is Genpact Limited. For the gist of my investment thesis, I would refer readers to my May 2026 Dividend Stock Purchases/Sales blog post.

Basically, G is an investment-grade IT services and solutions company that I believe can continue to compound its adjusted diluted EPS by around 10% annually. While generative AI fears have caused a sharp selloff in 2026 so far, the Advanced Technology Solutions segment (implementing AI for Fortune 500 businesses) is contradicting the concern that AI is going to replace its business. On the contrary, the ATS segment's net revenue soared 24.3% over the year-ago period in Q1 2026 (to now 27% of total net revenue). All the while, the core business held its own, reporting 1.4% growth in Q1 2026.

The 2.3% dividend yield is very safe, with the payout ratio set to be in the high-teens in 2026. That should power at least 10% annual dividend growth over the next several years.

At the current $33 share price, the stock is trading at a forward 12-month P/E ratio of just 7.7. No, that's not a typo. Yes, you read that right. This is less than half of the 10-year average FAST Graphs P/E ratio of 17.1 and the five-year average of 15.6.

GNG Research

Given G's intact growth prospects, I believe a reversion to 15x is a reasonable base case. That would imply shares are trading at a 49% discount to my $63 fair value per share estimate. Even applying the more conservative $53 fair value per share estimate from my friends over at GNG Research (by the way, anybody signing up with my link above receives 35% off every payment), shares are an undeniable value right now.

Dividend Stock #3: McDonald's Corporation (MCD)

The third stock on my watch list for July 2026 is none other than McDonald's Corporation.

As macro pressures have squeezed discretionary budgets, lower consumers have become especially selective. My investment thesis centers on MCD dominating the value wars and reclaiming traffic, with everyday menus priced under $3 alongside targeted promotions, such as the $4 Breakfast Meal Deal. Then, there's the fact that more than 95% of locations operate under franchised models (all but 2,027 of the nearly 45,700 systemwide restaurants). 

In essence, McDonald's is both a landlord (the greater of a base minimum rent or a percentage of gross sales generally around 8% to 10% is paid in rent) and a tollbooth-like franchisor (franchisees typically pay a royalty fee of 4% to 5% of gross monthly sales). When the cost of inputs like beef, potatoes, and labor go up, franchisees are typically forced to raise menu prices to protect unit economics. In turn, MCD takes its cut of these larger sales stemming from inflation right off the top.

That's why the FAST Graphs analyst consensus is for 8.1% annual non-GAAP diluted EPS through 2028, off a 2025 base of $12.20. MCD also enjoys a BBB+ S&P credit rating with a stable outlook.

The 2.6% dividend yield is also secure, with the payout ratio poised to be in the mid to high-50% range in 2026. That should enable decent dividend growth over the next few years.

GNG Research

From the current $282 share price, the stock is arguably somewhat undervalued, too. MCD is priced at a forward 12-month P/E ratio of 20.9. This is moderately below the 10-year average P/E ratio of 25.2 and  is 9% under my fair value per share estimate of $311 (a fair value P/E ratio of 23, which is almost a standard deviation less than the 10-year average). GNG Research is even more bullish, with a $349 fair value per share estimate.

Dividend Stock #4: Microsoft Corporation (MSFT)

The next stock on my watch list for the upcoming month is Microsoft Corporation. This one has been no stranger to the list in recent months, so I would encourage readers to check out my June 2026 Stock Watch List blog post for my investment thesis.

Essentially, MSFT has big growth catalysts with cloud computing, enterprise software, and AI. These secular tailwinds are why FAST Graphs anticipates upper teens percentage annual non-GAAP diluted EPS growth through FY 2028, off a FY 2025 base of $13.64.

MSFT is the only tech company in the world with a flawless AAA S&P credit rating with a stable outlook. The 0.9% dividend yield is modest. However, with the payout ratio likely to be in the low-20% range for FY 2026, there's plenty of room for 10%+ annual dividend growth to persist.

At the current $403 share price, the stock is trading at forward 12-month P/E ratio of 20.9. That's well below the 10-year average P/E ratio of 29 and 25% under my fair value per share estimate of $539 (a fair value P/E ratio of 28).

Dividend Stock #5: NVIDIA Corporation (NVDA)

The fifth stock on my watch list for July 2026 is NVIDIA Corporation. Just like MSFT, I'm running this one back.

This is because NVDA is a paradoxical example of a stock that doubles as a value stock (more on that in a second) and a growth stock. The continued AI infrastructure buildout around the world has the FAST Graphs analyst consensus for FY 2027 (ending in January 2027) non-GAAP diluted EPS soaring 86.4% to $8.89. In FY 2028, another 38.3% spike is anticipated to $12.29. For FY 2029, an additional 21.1% surge to $14.88 is the current consensus. So, that's the growth aspect of NVDA.

Not to mention that shares are trading at a forward 12-month P/E ratio of just 20.5. That's a fraction of the 10-year average P/E ratio of 44.3 and the 20-year average P/E ratio of 35.1! It's also cheaper than the S&P 500.

The balance sheet is also world-class, with an AA- S&P credit rating and a stable outlook. As if this wasn't enough, NVDA is also now a dividend growth stock after its whopping 2,400% hike in the quarterly dividend per share to $0.25 last month. All the while, the payout ratio is set to be roughly 9% in FY 2027. In other words, more strong dividend growth is likely on the way. That's why I'm excited about a seemingly small 0.5% yield.

GNG Research

Even my rather conservative fair value P/E ratio of 30 yields a fair value per share estimate of $303. That's up from my prior fair value estimate of $265 and is 32% below the current share price. GNG Research's potentially more base-case fair value of $355 would represent a staggering 42% discount to fair value.

Concluding Thoughts:

That's all for now. Based on my currently planned allocations to each, my yield will be around 2.2% (I'll probably add a small position in an existing qualitative high-yielder to juice this a bit further). This isn't the most impressive yield, but for my money, I think this is a fantastic basket of stocks that offers a bit of everything.

Discussion:

Are any of BAM, G, MCD, MSFT, or NVDA on your watch list for July 2026?

If not, what stocks are you monitoring in the month ahead?

Thanks for your readership and I look forward to your comments below!

May 2026 Dividend Income

As I'm writing this blog post, it's currently Tuesday, June 2nd. The temperature here in Central Wisconsin is set to reach a high of 81 degrees Fahrenheit today with a sunny forecast. So, I plan on spending some time outside for sure!

Now that May 2026 is complete, I figure it would be a fitting time to briefly highlight my dividend income for the month. Let's dive into it!

Net Dividend Income Surpassed $700

In May 2026, I collected $737.61 in net dividends (including ADR fees for British American Tobacco). This is equivalent to a 5.4% quarterly growth rate over the $699.63 in net dividends received in February 2026.

My net dividends collected in May 2026 were also 29.8% higher over the $568.35 in net dividends recorded in May 2025.

In my Charles Schwab account, I received $683.84 in net dividends from 18 companies. The lower company count was due to the sales of Bristol Myers Squibb and AT&T in February 2026. First-time distributions from Western Midstream (WES) and capital allocation in recent months powered my net dividends higher in this account.

My Robinhood IRA portfolio collected $36.57 in net dividends from four companies. This higher income was mostly fueled by my purchase of 23 shares of NNN REIT (NNN) in February 2026.

In my Webull account, I received $17.20 in net dividends from three companies.

Concluding Thoughts:

May 2026 represented the first time that the portfolio breached $700 in the middle month of a quarter. Through the first five months of 2026, my net dividends are up 28.3% versus the first five months of 2025. By God's grace, keeping the pedal to the medal with my high savings rate, stacking up dividend growth, and reinvesting dividends, I hope to keep this in the high-20% range in 2026.

Discussion:

How was your dividend income in May 2026?

Did you receive any first-time passive income as I did with WES in May 2026?

I appreciate your readership and welcome your comments below!