John Bogle, the legendary founder of Vanguard Group and pioneer of index funds, left a lasting legacy of knowledge and inspiration. He was rich, of course, but you can apply Bogle’s dividend investing principles with $10,000 or less.
Many investors today are in love with high-yield stocks, but Bogle didn’t focus too much on the biggest dividends. Instead, he adhered to sensible core principles that have stood the test of time.
His fans, known as “Bogle-heads,” come from a variety of backgrounds and have investment accounts of varying sizes. Fortunately, Bogle left the world with a dividend methodology — with action steps that virtually anyone can use — to grow a small portfolio over the long term.
As mentioned earlier, higher yields are not always the best choice. Bogle warned: “Most investors should avoid touching the risky side of higher-yielding junk bonds and high-dividend stocks.”
The images are clear and purposeful. We should put stocks with gigantic dividend yields in the same category as junk bonds; in other words, the tempting short-term payoffs probably won’t be worth the long-term loss in value.
Instead of reaching for the highest dividend yields you can find, consider focusing on earnings growth as it is a fundamental driver of wealth development. As Bogle put it, “simply because of dividend yields and earnings growth, the fundamental value of stocks is very likely to increase over time.”
In addition, it is entirely possible to find dividend-paying stocks representing companies with earnings growth. Better yet, if you really want to support Bogle’s spirit and values, stick to stocks that represent solid companies.
Just because your portfolio size isn’t $50,000 or $100,000 doesn’t mean you have to bet your capital. Bogle wouldn’t want you to consume the tempting but risky “doughnuts” of the market; instead, they’d like you to favor healthier stock market “bagels” that focus on “dividend yield plus earnings growth.”
Unfortunately, we can’t know exactly which dividend stocks Bogle would pick for a dividend portfolio today. However, we can assume that Bogle would favor a similar action American Express (NYSE:AXP).
It’s not the lowest priced stock on the market, but even a small account size should have room for one or two American Express stocks. Additionally, American Express’ annual forward dividend yield of around 1% isn’t gigantic, but it’s respectable and doesn’t raise any red flags.
Bogle certainly wouldn’t just look at American Express’s dividend yield or stock price. He would also be looking to increase the company’s earnings and luckily we can easily investigate this.
As it turns out, in the fourth quarter of 2025, American Express grew its net income by 13% year over year to $2.462 billion. The company’s net income for 2025 also rose 7% year-over-year to $10.833 billion.
On top of all that, American Express has stated plans to raise its regular quarterly dividend by about 16% starting in the first quarter of 2026. So AXP stock could be a good Bogle-style pick for dividend portfolio builders today.
Along with decent dividend distributions and earnings growth, Bogle’s investment method emphasized the clarity of his “investment strategy and dividend policy.” That clarity, Bogle insisted, “must be shared by fund managers (acting on behalf of fund shareholders), understood by the fund’s investment adviser and overseen by fund managers.”
This, Bogle said, is among the key “ingredients” of success for managed funds, but could easily apply to investors today. Having an account of less than $10,000 doesn’t mean you shouldn’t do your full due diligence on potential investments.
In other words, Bogle was a passionate researcher, and you should strive to be one too. Get into the habit of reading quarterly and annual financial reports as well as earnings call transcripts.
If you can’t identify a company’s “investment strategy and dividend policy,” that’s a huge red flag and possibly a cliffhanger. When your account size is limited, you really can’t afford to bet on shady or secret businesses.
And if your portfolio size is $10,000 or less, it’s a good place to start by looking for reliable, low-volatility, dividend-paying stocks. There are some examples Coca cola (NYSE:KO), ExxonMobil (NOT Home Depot (NYSE:HD) and Johnson & Johnson (NYSE:JNJ).
To truly be a boggle-head, only consider dividend-paying stocks that you’d like to hold for the long term. Bogle was more of a marathon runner than a sprinter, so consider doing your research, focusing on growing your earnings, and building your portfolio slowly for the best results.
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