For dividend investors, when we look at dividend returns, do we look at it from angle of cash assets from company cash or is it from
Free cash flow?
I believe that in order for dividend returns to be substainable, it should be from what is recurring.
When we spend a portion of recurring income while
Leaving capital untouched, we can use the capital to invest and in return even higher cash flow. Hence, I believe in spending as a portion of recurring income instead of vs assets. Similar to how we evaluate dividend companies.
With regards to 1:100 or 1:1000. Using the same approach, but vs income. When income is $4000, spending $4 won’t be painful. But spending $40 builds up rapidly.
Hence, before income is high enough to spend at 1:1000 rate, the focus should be on accumulating assets to get high enough active + passive income before spending to reward ourselves. But then, that’s just my POV. [Cool]
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