Dividend Increase | Aflac $AFL #Dividend

Dividend | Dividend Growth | Financial Independence | Freedom | Passive Income
Getting a pay raise while sitting on the couch?  Sign me up!  Thanks Aflac for another dividend increase!

There's an old Chinese proverb that says "the best time to plant a tree was 20 years ago, the next best time is now".  The reason for this is that it takes time for a tree to grow and prosper and for you to start reaping its benefits.  Dividend growth investing is much the same way.  It takes consistent saving and investing as well as time and patience to let the power of dividend growth take hold.

That's why one of my favorite things is when one of the companies I own decides to pay out more in dividends.  You mean I get a pay raise just for owning a small piece of a company?  Not going and doing R&D for new products or technology.  Not selling any products.  Not managing any employees or inventory.  Not making sales calls.  All I had to do was have the foresight to invest some of my savings in excellent companies.  

On November 1st the Board of Directors at Aflac (AFL) announced an increase to their quarterly dividend payment.  The dividend was increased from $0.42 to $0.50 which is an excellent 19.1% increase.  Shares currently yield 2.46% based on the new annualized payout.

The new dividend rate will be payable March 1st to shareholders of record as of February 21st.

Since I own 146.822 shares of Aflac in my FI Portfolio, this raise increased my forward 12-month dividends by $46.98.  This is the 12th raise I've received from Aflac since initiating a position in early 2013 with the total organic dividend growth over that time coming to 186%.  

A full screen version of this chart can be found here.

Aflac is a Dividend Champion with 41 consecutive years of dividend growth.  Aflac's dividend growth has fluctuated a bit especially over the last ten years; however, an increase has always come and over time the pace has been more than adequate.

Since 1993, Aflac's year over year dividend growth has ranged from 1.8% to 45.5% with an average of 14.6% and a median of 14.7%.

There's been 27 rolling 5-year periods over that time with annualized dividend growth spanning from 5.4% to 28.3% with an average of 14.4% and a median of 14.3%.

Over that time there's also been 22 rolling 10-year periods with Aflac's annualized dividend growth landing between 6.8% to 22.7% with an average of 14.6% and median of 15.6%.

The 1-, 3-, 5- and 10-year rolling dividend growth rates for Aflac since 1993 can be found in the following chart.  

A full screen version of this chart can be found here.

For dividend yield theory I consider the fair value range to be the forward dividend yield +/- 10% compared to the 5-year moving average, the under/over value area to be to between 10%-20% deviation from the average and significant over/under value are greater than a 20% deviation from the average.

A full screen version of this chart can be found here.

Aflac's 5-year average forward dividend yield is 2.52% which corresponds to a share price of $79 based on the new annualized payout.  

I consider the fair value range based on dividend yield theory to be the 5-year moving average yield +/- 10%.  That gives a fair value range of $72 - $88 and suggests that shares are currently trading around fair value.

Wrap Up

This raise increased my forward dividends by $46.98 with zero effort on my part.  That's right, absolutely nothing to contribute to their operations.  Based on my FI Portfolio's current yield of 2.73% this raise is like I invested an extra $1,719 in capital.  Except that I didn't!  One of the companies I own just decided to send more cash my way. 

That's how you can eventually reach the crossover point where your dividends received exceed your expenses.  That's DIVIDEND GROWTH INVESTING AT WORK!  The beauty of the dividend growth investing strategy is that you build up your dividends through fresh capital investment as well dividend increases from the companies you own.

This is the 54th dividend increase I've received from the companies in my FI Portfolio which have boosted my forward 12-month dividends by $672.41 combined.

My FI Portfolio's forward-12 month dividends are $12,060.42  Including my FolioFirst portfolio's forward dividends of $247.42 brings my total taxable accounts dividends to $12,307.84  My Roth IRA's forward 12-month dividends are $1,257.12.  My Rollover IRA's forward dividends are $4,437.54.  Across all accounts I can expect to receive $18,002.50 in dividends over the next year.

I've also started compiling dividend data on many of the companies that I own or would like to own.  Aflac's can be found here which includes the dividend history (as far back as I can find without spending hours hunting it down), rolling dividend growth rates and dividend yield theory.  To see other companies that I've already gathered the data on you can check out the Dividend Companies page.  Check it out and let me know what you think.

Do you own shares of Aflac?  

Please share your thoughts below.


  1. Sign me up for that AFL increase. Can't complain about that. AFL has been a long time winner for multiple decades. Glad it's in my portfolio. Kind of takes the sting off of some of my cutters over the years.


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