Before the whole month of January gets away from me, I’m here to share my Portfolio goals for 2025!

I expect you’ll be familiar with all the goals I’m setting, as I’m running back the ones from last year.  The numbers will be changing though!

I’ve generally been successful in achieving the majority of my goals each year, and I expect that to continue.

Last year, I achieved all 3 of my primary goals, but only 1 of my 3 bonus goals… see my Review of 2024 Portfolio Goals.  I was 4 for 6 overall regarding Portfolio goal success.  This is a quality result, however, I’ve yet to achieve 100% of the goals I set.  Perhaps 2025 will be my year to make that happen.

Setting some Portfolio goals has helped me stay focused on reaching many dividend milestones.  While the annual goals are focused on the current year, what they really do it keep me on track for the long-term.  And dividend growth investing is a long-term game, for sure.

For 2025, I return with my 3 primary goals (no changes other than the amounts), and my 3 bonus goals (no changes whatsoever).  The primary goals are based on new capital investment, annual forward dividend income, and actual dividend income.  As for my bonus goals, my first two aim to bring a couple of my Portfolio sector weightings into a desired target range, while the remaining one involves making sure I have fewer stocks in my Portfolio that fail to have at least a 0.5% value weighting within my Portfolio.

Here are all the details for my 2025 Portfolio goals…

 

Portfolio Goals for 2025

1) Invest at least $10,000 of new capital in the Portfolio

For 2025, I’m sticking with my normal $10K investment goal.

Once again, this year I’ll be stockpiling cash in my dash to retirement.  Thus, investment cash will have to suffer.  However, I think I can make $10K work.

Note that this is ‘new’ capital invested into my Portfolio.  I’ll probably be reinvesting around $21K in dividends during the year, too.  However, the reinvested dividends are already part of the Portfolio, as opposed to new money being added to the Portfolio.

Also note that this is a ‘net’ capital investment, so that money that comes out of my Portfolio (such as sales from my Portfolio or dividends that are not reinvested) subtract from the new capital investment amount.

 

2) Reach $23,500 in annual forward dividend income

I began 2025 with annual forward dividend income of $21,003.31 (or ~$1,750.28/mo).  In order to reach my goal of $23,500 in annual forward dividend income by the end of 2025, I’ll have to add a record amount of nearly $2,500 of forward dividend income this year.  This amount is slightly higher than the record $2,425.25 I posted last year.

Should I reach my goal, I’ll be averaging ~$1,958/mo. at the end of 2025.  This would translate to YoY growth of 11.9% for my annual forward dividend income number.  I can live with that.  🙂

Here’s my outline for adding the needed $2,500 to reach my annual forward dividend income goal:

• Reinvest nearly all the $21,003.31 in annual forward dividend income that I’m starting the year with at an average 2.65% (i.e. ~$550 in additional forward dividend income due to dividend reinvestment)
• Realize a weighted average 7.15% dividend raise across the current Portfolio holdings (i.e. ~$1,500 in additional forward dividend income due to dividend raises).  Note – I lowered this from my usual 8% dividend raise weighted average, as dividend raise percentages have been drifting lower in the past couple of years.
• Invest the $10K of new capital mentioned above at a target yield of ~3.00% (i.e. ~$300 in additional forward dividend income due to new capital investment).  This 3% yield is higher than my year-end Portfolio average of 2.65%, but I believe I will achieve higher yields with my new capital investments in 2025.

In total, that’s ~$2,350 in additional forward dividend income that I’m planning on.  This still leaves me about $150 short of my $2,500 target.

As usual, there are ways I can find the final $150 in additional forward dividend income needed to obtain my $23,500 goal, including:

• Invest more than $10K in new capital
• Invest the new capital and/or the reinvested dividends at a higher yield than I projected (3.0% for new capital investment, and 2.65% for reinvested dividends)
• Get a larger weighted average dividend raise than the projected 7.15%.
• Make some strategic stock swaps, trading one or more lower-yielding investments for higher-yielding ones.
  

No doubt, I’ll need to avoid dividend cuts and suspensions in 2025, too.  I was essentially unscathed in this regard last year.

 

3) Collect $22,350 in actual dividend income

My actual dividend income climbed handsomely in 2024, ending the year at $19,866.60 (for an average of $1,655.55/mo.).  I added $2,231.68 in actual dividend income compared to the prior year, with the YoY growth being 12.65%.  This YoY growth percentage topped the expected 12% number I was targeting.  I added more than $2K to my actual dividend income for a 2nd consecutive year, however, I didn’t add as much as the prior year.

If I’m going to provide a range in which I might finish for my actual dividend income in 2025, it would be a minimum of $22,250 (12% YoY increase) and a maximum of $22,450 (13% YoY increase).  I’m going to split the difference this year and shoot for a 12.5% YoY increase.  This would put my actual dividend income number around $22,350.

Reaching $22.5K in actual dividend income for 2025 ($150 more) would be a nice surprise, so I’ll make that my stretch goal.  That’s a 13.25% YoY increase.

If I reach the $22,350 threshold, that will translate to an average of $1,862.50/mo. in dividend income.

 

Bonus Goal #1 – Continue to increase the weighting of Technology in my Portfolio (reduce the weighting difference needed to get in my target range)

This goal has been tough to achieve in the past couple of years.  I’m keeping it around until I make some progress on this front.

At the start of 2025, my Information Technology sector weighting was underweight that of the S&P 500 by a whopping 11.86 percentage points (20.63% vs. 32.49%).  My Tech sector weighting would have to increase by 8.86 percentage points just to reach the outside of my +/-3 percentage points target range.  Thankfully, this goal doesn’t require getting into range, only to make progress towards getting into range.  Any reduction in that 11.86 percentage point weighting difference will do.

I could make progress towards this goal by:

• putting my new capital investment into Tech sector holdings
• having my existing Tech sector holdings outperform the S&P 500 Tech sector during the year
• selling a stock in one of my overweight sectors and re-deploying the proceeds into a Tech sector holding

 

Bonus Goal #2 – Continue to decrease the weighting of Industrials in my Portfolio (reduce the weighting difference needed to get in my target range)

I actually achieved this goal last year, reducing my weighting difference in Industrials by 0.80 percentage points.  However, I still have a long way to go to bring Industrials into my preferred weighting range, so the goal is sticking around in 2025 as there’s more work to do.

2025 began with my Industrials sector weighting being overweight by 7.13 percentage points compared to the S&P 500.  I would need to decrease my Industrials sector weighting by 4.13 percentage points in order to reach the outside of my +/-3 percentage points target range.  Just as in Bonus Goal #1 though, I don’t need to get into target range, only to make progress towards getting in range.  Success will be any reduction in the 7.13 percentage point weighing difference.

I could make progress towards this goal by:

• avoid putting any of my new capital investment into Industrials sector holdings
• having my existing Industrials sector holdings underperform the S&P 500 Tech sector during the year (no thank you!)
• selling a stock in my Industrials sector and re-deploying the proceeds in any of the other 10 sectors (I like this idea better)

 

Bonus Goal #3 – Cut in half  (at least) the number of stocks that don’t have a 0.5% value weighting within my Portfolio

A long-term Portfolio goal of mine is for each holding to have at least a 1% value weighting.  At the start of 2025, there were 28 stocks that didn’t meet that criteria (out of my 59 Portfolio stocks).

Addressing that many stocks is more than a 1-year task, so I’ll focus on tackling the handful of stocks that fail to even meet a 0.5% value weighting and attempt to get them above that 0.5% threshold.  There were only 4 stocks that small to begin the year.

I could address the weighting issue for these 4 holdings by:

• investing enough new capital into them to get them over the 0.5% weighting threshold
• using any sale proceeds I might have to buy more shares in these positions
• having the individual stock outperform the rest of my Portfolio
• eliminating the stock from my Portfolio altogether

No matter how it gets done, the goal will be to have 2 or less stocks with less than a 0.5% Portfolio weighting by the end of 2025.  Ideally, I would like to have no stocks below the 0.5% weighting threshold by year’s end, but making some progress is the key.

Here are the 4 small holdings that failed to hold at least a 0.5% value weighting in my Portfolio at the start of 2025:

• American Tower (AMT) – 0.486%
• NNN REIT (NNN) – 0.467%
• Chevron (CVX) – 0.462%
• McCormick & Co. (MKC) – 0.460%

These positions don’t need to grow too much in size to exceed 0.5%, so I’m cautiously optimistic I can do this.  However, invariably there will be some stocks just above the 0.5% level that will perform poorly in 2025 and see their weighting cross below the 0.5% threshold.  Thus, I may need to work on more than just these 4 positions.  We’ll see how it shakes out.

 

Summary

My set of goals are basically the same as what I had last year, short of some changed numbers.  I still have 3 primary goals, and 3 bonus goals.

My primary goals still consist of the 1 investment goal ($10K) and the 2 dividend income goals ($23.5K for forward dividend income & $22.35K for actual dividend income).

The bonus goals are still comprised of 2 sector weighting goals (for Information Technology and Industrials) and a Portfolio weighting goal for my smallest positions (>0.5% weighting).

I’m still looking for a clean sweep of achievement for the goals I set.  Perhaps 2025 will be the year I get this done.  Wish me luck!

As always, I’ll be checking on my goal progress in July, as part of my mid-year review.  Until then…

 

Have you established any 2025 portfolio goals?  What level of goal achievement are you expecting?  I look forward your Comments!