Follow the dividend investment decisions of a person who has no background in financial investment and wishes to take control of their financial future to retire from their full-time job at 60.

Weekly Portfolio Summary - 13 Jul 2019 11:44

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Portfolio Activity

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Portfolio News - (In Case You Missed These Headlines)

Armanino Foods of Distinction (AMNF)

Bar Harbor Bankshares (BHB)

Cummins (CMI)

General Mills (GIS)

Garmin (GRMN)

Iron Mountain (IRM)

Johnson & Johnson (JNJ)

Merck (MRK)

Pepsico (PEP)

Qualcomm (QCOM)

Ryder System (R)

T. Rowe Price (TROW)

Walgreens Boots Alliance (WBA)

Williams-Sonoma (WSM)

Interesting Blog Posts or Articles

Blog Posts
Leaderboard: Monthly Dividend Income From The Blogging Community by Dividend Driven
Stockboard: What Stocks The Blogging Community Are Buying This Week by Dividend Driven

Articles
Is Retirement Flawed
What to Do When You Inherit Your Parent’s House - Comments: 0

New Buy MMM - 09 Jul 2019 20:23

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Brokerage Buy: 3M Company (MMM)

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Purchase Price: $166.97/share
Increase in Forward Annual Div: $34
Inflation Beating Streak: 19 Years
Div Growth Streak: 61 Years
Yield: 3.45%
Payout Ratio: 61%
Most Recent Dividend Increase: 5.88% / Feb 2019

This is my second buy of 3M. As long as the stock stays in the $160's range I will continue to add to my position. - Comments: 0

Weekly Portfolio Summary - 06 Jul 2019 12:03

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Portfolio Activity

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Portfolio News - (In Case You Missed These Headlines)

Brookfield Renewable Partners (BEP)

Garmin (GRMN)

Hospitality Properties Trust (HPT)

Marine Products (MPX)

Pfizer (PFE)

Phillips 66 (PSX)

Interesting Blog Posts or Articles

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Leaderboard: Monthly Dividend Income From The Blogging Community by Dividend Driven
Stockboard: What Stocks The Blogging Community Are Buying This Week by Dividend Driven

Articles
A portfolio manager warns of 4 possible red flags in company proxy statements
Millennials who live with mom and dad will need $10,000 to move out - Comments: 0

Why Turning 50 Was A Major Financial Milestone - 05 Jul 2019 12:14

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In 2018 I turned 50 it marked a special event for me as it represented 35 years of earning income. I have been working since I was 16 years old which equates to 35 years of filing tax returns and paying the FICA or OASDI tax (social security) and never had a year of no earned income making this a huge moment for my Social Security benefit at retirement.

To better understand why I consider this such a major milestone you need to understand how your Social Security payment is determined. The Social Security Administration (SSA) calculates your payment based on what they refer to as the 35 year rule. From the SSA website here is the definition of the 35 year rule:

“Social Security calculates your average indexed monthly earnings during the 35 years in which you earned the most. We apply a formula to these earnings and arrive at your basic benefit, or “primary insurance amount.” This is how much you would receive at your full retirement age — 65 or older, depending on your date of birth.“

The interesting part of this calculation is it totals 35 years’ worth of index adjusted income and then divides that by 420 months (35 years) to determine your “Average Indexed Monthly Earnings” or AIME. Then SSA applies what they call AIME bend points (for text “AIME bend points” to determine what % of your AIME will be paid out as a benefit. The formula is never less than 420 months so if you have less than 35 years of income then those $0 earning years are used in your calculation. That’s 12 months of 0’s for every year of not working being factored in that 420 average!

My personal goal has always been to retire early at age 60 and collect my SSA benefit at age 65. Out of curiosity I calculated what my SSA benefit at 65 would have been I retired at different ages:

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As you can see in the chart above the biggest increase in the monthly payout is from age 40 to age 50 and this is due to the fact that I have achieved earned income for all 35 years. You could argue that these are my highest paying years any why the big difference. However, if you look at the increase from age 50 to 60, those additional 10 years of higher pay would replace my 10 lowest years and it only resulted in a monthly increase of $255. So the big deciding factor is not having to average in any 0’s.

The FIRE movement has motivated many to retire in their 30’s & 40’s and I have to give them a lot of credit for having the discipline and courage for their achievement. For me though I have a tendency of visualizing risks and a desire to avoid them as much as possible. As I have gotten older I have definitely become more risk averse. Maybe it is age, experience or just plain fear but I simply do not like risk. When I see my SSA benefit is double what it would have been when I was 35 I feel that much more secure knowing I have a significant steady monthly income that can address any risks that I have not foreseen in my 60s or later years.

As a note, I am not condemning people that retire in their 30s or 40’s. Or that my approach is right or wrong. At the end of the day it is what I am comfortable with as it helps alleviate concerns I have about unknown risks. I have only recently been making a very good salary and saving at a higher rate (close to 25%). In theory my investment income at 60 will cover monthly expenses and support a mild inflation rate of less than 4%, but that is as far as it goes. The SSA benefit will allow me to have income to minimize unknown risks and to be a source of money to occasionally indulge in things outside my normal expenses or day to day activities. Regardless of your situation, when it comes to social security the 35 year rule is something everyone should be aware of and how it impacts you. - Comments: 0

June Dividend Income - 29 Jun 2019 13:22

Tags: monthly_income

I have not posted anything the last couple of weeks as I have been working hard and recently sick. I decided to skip last week and this week’s weekly posting and instead will jump right into my monthly report…

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After 32 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 June I made $2,538; an increase of 6.09% versus this time last quarter. The bulk of the increase came from dividend increases announced in the first quarter that are finally paying out.

For the month I made 2 stock purchases and both were for existing holdings in Chatham Lodging Trust (CLDT) for my Roth and AbbViie (ABBV) for my IRA.

On Monday I’ll ad my regular monthly deposits to my brokerage & Roth accounts which will increase my brokerage account balance to over $1K so I expect next month’s stock purchase to be in this account.

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Looking at my 3 year goal metric I improved my percent complete by 0.53% from last month. Looking at my remaining time to complete this goal (28 months) I need a monthly increase in percent complete of 0.94%.

I have doubts of achieving this goal under current circumstances. Inflated stock prices are a contributor hurting dividend reinvestment and have since reviewed my portfolio to turn off DRIP programs for approximately 25% of my holdings and instead will accumulate the cash and buy select stocks. I’ll give it 3 months to see if this rights the ship, if not I may have to consider increasing my monthly investments.

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Progress on my last goal of saving an additional $2,000 of emergency cash remained the same as last month with a balance of $650. I had too many little emergencies that popped up this month that overran my budget and the cash was reallocated to resolve those problems. This is the second goal I am in danger of not achieving and it is a little frustrating. Guess I need to dig a little deeper and toughen it out. - Comments: 2

New Buy ABBV (from Wed. 6/26) - 29 Jun 2019 12:44

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IRA Buy: AbbVie (ABBV)

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Purchase Price: $67.30/share
Increase in Forward Annual Div: $64
Inflation Beating Streak: 6 Years
Div Growth Streak: 6 Years
Yield: 6.36%
Most Recent Dividend Increase: 11.46% / Jan 2019 - Comments: 1

Weekly Portfolio Summary - 15 Jun 2019 19:08

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Portfolio Activity

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Portfolio News - (In Case You Missed These Headlines)

Preferred Apartment Communities (APTS)

Garmin (GRMN)

Iron Mountain (IRM)

3M (MMM)

Merck (MRK)

Phillips 66 (PSX)

AT&T (T)

T. Rowe Price (TROW)

W.P. Carey (WPC)

Interesting Blog Posts or Articles

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Leaderboard: Monthly Dividend Income From The Blogging Community by Dividend Driven
Stockboard: What Stocks The Blogging Community Are Buying This Week by Dividend Driven
Personal Finance Advice That Needs To Die by Ben Le Fort
Financial Security for Everyone by Retire Before Dad

Articles
Lawn Care is Absurdly Expensive
How a Big Emergency Fund Can Lower Your Insurance Bill - Comments: 0

Weekly Portfolio Summary - 08 Jun 2019 12:30

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Portfolio Activity

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Portfolio News - (In Case You Missed These Headlines)

Cummins (CMI)

Camden Property Trust (CPT)

Fastenal (FAST)

Hospitality Properties Trust (HPT)

Kraft-Heinz (KHC)

Medical Properties Trust (MPW)

Merck (MRK)

3M (MMM)

VEREIT (VER)

W.P. Carey (WPC)

Interesting Blog Posts or Articles

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Leaderboard: Monthly Dividend Income From The Blogging Community by Dividend Driven
Stockboard: What Stocks The Blogging Community Are Buying This Week by Dividend Driven
The things we DON’T teach about money in school (but really should!) By Debt Free Family
Emergency Fund Examples: 23 (Unexpected) Reasons Why You Need One

Articles
Financial Goals and the Arrival Fallacy - Comments: 0

New Buy CLDT - 06 Jun 2019 21:31

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Roth IRA Buy: Chatham Lodging Trust (CLDT)

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Purchase Price: $18.76/share
Increase in Forward Annual Div: $70
Inflation Beating Streak: 0 Years
Div Growth Streak: 0 Years
Yield: 7.04%

I realize Chatham Lodging (CLDT) is not a dividend growth stock but my REIT diversification was getting extremely light on Hotel REITs so I took advantage of a price drop and scooped up a small position with a 7% yield.

For those curious about my REIT diversification here are the different REIT sectors I try to maintain an even spread with:

  • Data Storage
  • Entertainment Facilities
  • Hospitals
  • Hotels
  • Industrial Facilities
  • Residential Apartments
  • Retail Stores
  • Senior Housing
  • Timber
  • Warehouses - Comments: 0

May Dividend Income - 31 May 2019 20:47

Tags: monthly_income

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After 32 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 May I made $2,412; an increase of 9.16% versus this time last quarter. The bulk of the increase came from dividend increases announced in the first quarter that are finally paying out.

For the month I made 5 stock purchases. Two were brand new positions in 3M (MMM) and Williams-Sonoma (WSM) and three buys were adding to positions in Leggett & Platt (LEG), Iron Mountain (IRM) and Weyerhaeuser (WY). I haven’t done this much buying in a while but market prices started retreating making some stocks affordable.

I’m tapped for cash right now and markets are continuing to drop making for quite a few decent entry points. I seriously hope that the markets stay depressed through the end of summer so I can capitalize on some decent yields from re-invested dividends to help juice up my forward dividend income.

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Looking at my 3 year goal metric I improved my percent complete by 0.83% from last month and most of that is coming from all the recent buying activity I have been doing.

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Progress on my last goal of saving an additional $2,000 of emergency cash increased from $200 to $650. Nice boost from last month but I am still off target by $300. - Comments: 2

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