03 Sep 2020 21:41
Tags monthly_income
After 33 years of clocking in and out of work and religiously saving 10% annually every year, in good times and bad, I have decided to share my monthly dividend income to show what regular saving and investing can accomplish.
For the month of August I made $2,111; a decrease of -8.4% versus this time last year. This is back to back months of consecutive decreases and is the 4th out of the last 5 months to experience a YoY decrease. I know this is temporary but it does sting none the less.
Obviously some of the decreases are due to COVID but I also sold quite a few positions and finally put all that cash to work. In my previous post I identified 9 different stocks I sold out of (or greatly reduced my position) and in turn bought a total 22 new stocks. I am expecting these new buys to start paying out in the 4th quarter so hopefully these monthly decreases will be coming to an end shortly.
I continued with my weekly M1 Finance contribution of $120 for a total of $480. The overall dividend yield of my M1 pie slightly decreased to 3.505% as the market continues its recovery.
Overall my M1 Finance accounts contributed $33.23 to this month’s dividend totals. This is my largest monthly contribution and this account is slowly gaining steam.
I also provided a link to my M1 Pie for those interested in seeing all of the individual holdings.
https://m1.finance/iCDyjkqucd1B
My age 53 goal (I’m 51 for those not in the know) had a huge increase of 7.6%. The big jump was from my efforts of selling stocks from April thru July and then redeploying all that cash in August. I can’t wait for the 4th quarter when these new investments begin adding more income.
For those not familiar with my Age 53 goal, I plan in 7 year increments and targeted to have 57% of my expenses to be covered via dividend income and to be at 115% for my next 7 year target at age 60. Why 115%? This was based on a multiple bear market/crash analysis I performed back in 2018 that showed my optimal portfolio to withstand a long term bear market with high inflation would be to have dividend income of 115% of expenses and the equivalent of 9 months of expenses in cash.
Post preview:
Close previewThose YOY declines are tough, I was surprised with one of my cuts I wasn’t hit by a YOY decline the only dividend stock that suspended was DAL but I’m not out of the woods yet but hopefully I get there. Hopefully this last quarter will bring you a big YOY increase.
Thanks Doug,
I look at this as a good thing, prior to the pandemic I was questioning some of my investments like hotel REITs when AirBnB was eating into their market. I held hotel REITs just to maintain a REIT diversification across industries and looking back that was not the best reason to hold those assets so this got me off the fence to sell.
My WestRock and Dominion sales were less about COVID and more of a reaction to poor leadership from both companies cutting their dividends.
At this point I feel very confident going forward.
Always tough to see the yr over yr declines, but as you noted, it should only be temporary. I recently had my largest holding resume dividend payments in Aug after suspending them at the beginning of 2019. I could have sold out, but I knew they would pull through the issues and eventually resume them again… and I have to say it's like a 'bonus' in a way after coming to terms with not receiving the payment for so long and then getting it back. I'm sure you'll be happy when all the capital deployed starts working for you next quarter. Also this all helps to confirm your prudent goal of saving 115% of your income so you can weather the rough times without too much worry.
Thanks D4J, I still hold a few dividend suspension stocks knowing they will come back once this blows over. Glad to hear your Vale holdings finally started paying dividends and it gives me hope to continue holding.