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Real Estate Income Corp. (NYSE:O), known as ‘The Monthly Dividend Company’, has been a reliable source of consistent dividend income for investors over the years. As a real estate investment trust (REIT) and member of the elite group of Dividend Aristocrats, Realty Income has an impressive track record of paying monthly dividends and increasing them over time.
But how much dividend income could you earn today if you had invested $10,000 in Realty Income stock ten years ago? Let’s dive into the numbers.
If you had invested $10,000 in Realty Income on April 29, 2014, when the stock price was $42.05 per share (adjusted for the November 2021 1032:1000 stock split), you would have been able to buy approximately 237.81 shares. At that time, the monthly dividend per share was $0.1825, meaning your initial monthly dividend income would have been $43.40.
Fast forward to April 26, 2024, and your investment would look very different depending on whether you choose to reinvest your dividends or not.
Scenario 1: Reinvest dividends
If you had reinvested all your dividends over the past ten years, your total return would be an impressive 100.87%. Your initial 237.81 shares would have grown to 373.98 shares, thanks to the power of compound interest and dividend reinvestment.
With Realty Income’s current monthly dividend of $0.2570 per share, your monthly dividend income would now be a whopping $96.11. That’s more than double what you started with ten years ago.
Scenario 2: Not reinvesting dividends
If you had chosen not to reinvest your dividends and instead collected them as cash, your total return over the past 10 years would still be a respectable 89.78%. However, your number of shares would have remained constant at 237.81.
Based on the current monthly dividend of $0.2570 per share, your monthly dividend income would be $63.07. While this is a significant increase from the original $43.40, it is significantly less than what you could have earned by reinvesting your dividends.
The power of dividend reinvestment
These scenarios clearly demonstrate the power of dividend reinvestment and compound interest. By reinvesting your dividends, you can buy additional shares without having to invest additional money. Over time, this can lead to a substantial increase in your total return and dividend income, as shown in the Realty Income example.
Diversify your monthly income stream with fractional real estate
While Realty Income is undoubtedly a solid choice for investors looking for consistent monthly dividend income, it’s important to remember that publicly traded stocks are subject to market volatility. For those looking to diversify their income streams and potentially reduce exposure to market fluctuations, real estate investing through platforms such as Arrived is worth considering.
Arrivald allows individuals to invest in rental property shares for as little as $100, providing the opportunity for monthly rental income and long-term appreciation without the hassle of a landlord. With more than $1 million in dividends paid last quarter and a growing portfolio of properties across markets, Arrivald offers an attractive alternative for investors looking to build a diversified real estate portfolio.
Click here to view the available properties on Arrival.
In conclusion, if you had invested $10,000 in real estate income ten years ago and reinvested your dividends, you would be earning an impressive $96.11 in monthly dividend income today. This example shows the potential of dividend investing and the importance of considering monthly dividend stocks like Realty Income for your portfolio.
However, smart investors should always explore multiple options to generate passive income. Platforms like Arrivald offer a unique opportunity to invest in real estate and potentially earn monthly rental income without the volatility of the stock market.
This article, Here’s What Your Monthly Dividend Income Would Be Today If You Invested $10,000 in Real Estate Income 10 Years Ago originally appeared on Benzinga.com
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