Introduction to Dividend Talk

Dividend growth investing is one of the simplest long-term strategies for building passive income. Instead of trying to predict stock prices, dividend growth investors focus on owning quality companies that can grow earnings and increase dividends year after year. Over time, that rising income stream can help reduce reliance on a salary, support financial independence, and create real flexibility in life.

This episode is the starting point for Dividend Talk. We introduce what dividend growth investing is, why we chose it, and how our European perspective shapes the way we invest.

This episode was recorded in 2020. The dividend growth investing principles are evergreen, but market conditions and individual stocks can change over time. For current market commentary and recent picks, please check our latest episodes.

What Is Dividend Growth Investing?

Dividend growth investing is an approach in which you invest in companies that not only pay dividends but also have the ability and willingness to increase them over time. The goal is not to chase the highest yield today, but to build a portfolio that produces a growing stream of income over many years.

This matters because inflation quietly erodes purchasing power. A dividend that grows over time can help protect income in the real world, not just on paper. Dividend growth investing also encourages a business-owner mindset. You pay attention to earnings, cash flow, and balance sheets because those fundamentals support the dividend.

If you’re brand new to this, a helpful next step is our episode on how to find dividend growth stocks, where we explain what we look for before we invest.

Why We Started Dividend Talk

Dividend Talk was created because investing can feel like a maze. There’s no shortage of opinions online, but few are tailored to European investors seeking to build long-term passive income.

We wanted to build something that feels practical and real. A weekly conversation where we look at the market, share our thinking, discuss mistakes, and focus on the same thing every time: building a portfolio designed to support financial independence.

This show is not about hype. It’s about progress.

Meet Your Hosts

Dividend Talk is hosted by two European dividend investors: European DGI and Derek

Derek is based in Ireland and started investing with a clear goal: freedom. Not just financial freedom in theory, but real life freedom , the ability to step back from long hours, spend more time with family, and build a future that doesn’t rely on reaching retirement age before life begins.

European DGI began investing in 2014 after seeing the lasting effects of the financial crisis. Watching how quickly job security and pension assumptions can unravel created a simple conclusion: if you want stability, you need to take control of your own financial future. Dividend growth investing became the strategy that matched that goal.

Why Dividend Growth Investing Instead of “The Usual Advice”?

A lot of personal finance advice in Europe tends to follow the same script: maximise the pension, buy property, and hope for the best. That approach works for some people, but it can also leave investors exposed to systems they don’t control.

In this episode, Derek explains why dividend growth investing appealed to him. He had seen how pensions and long-term promises can become uncertain when conditions change. For him, building a portfolio of dividend-paying companies felt more transparent and more controllable. It wasn’t about getting rich quickly. It was about creating options.

European DGI echoes the same motivation from a different angle. Instead of trusting traditional systems to recover, he wanted a strategy that could build income gradually over time through ownership of real businesses.

How We Actually Started Investing

One of the most useful parts of this episode is that both of us started in a very human way — not with perfection, but with action.

Derek describes buying his first shares in a company he knew through work and being surprised by how quickly dividends create motivation. Receiving a dividend within weeks of buying a stock made the whole idea feel real. That “getting paid to own” moment is often what hooks new dividend investors.

European DGI describes the opposite starting point: he originally treated investing like gambling. Watching prices constantly, using stop-losses, and reacting emotionally. Over time he discovered the dividend investing community and began to focus on cash flow and income growth instead of price fluctuations. That shift — from “watching the stock” to “watching the dividend income” — is one of the most important mindset changes in dividend growth investing.

If you want to go deeper into this mindset and the mistakes people make early, our episode on dividend investing mistakes is worth reading.

Our Focus: Income Growth, Not Price Movements

A core idea in dividend growth investing is that you measure progress through income, not daily price swings. Share prices will move around. That’s unavoidable. What matters is whether the business continues to generate earnings and cash flow, and whether the dividend remains affordable and growing.

European DGI describes putting “guardrails” in place before buying stocks and having clear reasons for selling. That’s why later episodes on fundamental analysis and when to sell stocks are essential parts of the Dividend Talk framework.

Stock Picks Mentioned in the Episode

This episode includes early examples of the types of companies dividend investors often talk about.

Derek discusses Medtronic as a dividend growth company he liked due to its long history of dividend increases and strong dividend growth rate at the time. He also references Johnson & Johnson as a high-quality business that many dividend investors admire for reliability.

European DGI mentions BASF as an example of a cyclical dividend stock where valuation and risk management matter more than simple dividend history. Cyclical businesses can play a role in a dividend portfolio, but they often require a different analysis approach than defensive consumer or healthcare businesses.

These mentions are included as examples from the conversation, not as recommendations. If you want the deeper process behind how we evaluate companies, the most useful next step is the episode on how we perform fundamental analysis.

Chapters From the Episode

This is a quick guide to the main sections of the conversation, based on the transcript.

0:00–3:10 – Welcome to Dividend Talk and why we’re doing this
3:10–11:55 – Why dividend growth investing appealed to us
11:55–16:35 – How we started and how we changed our mindset
16:35–19:10 – European perspective and currency risk considerations
20:40–28:30 – Stock pick examples and how we think about them
28:50–34:35 – What we’re watching next week and closing thoughts

Where to Go Next

If this episode is your starting point, the next best episodes are:

If you want to learn how we choose companies, start with EP 05: how we find dividend growth stocks. If you want to understand how we assess company quality, go next to EP 09: how we perform fundamental analysis. If you want to improve how you interpret earnings, EP 07 is the logical next step. And if you want the most challenging part of investing explained clearly, read EP 10 on when to sell stocks.

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