Dividend Update - June 2020

dividend growth investing | financial independence | freedom | dividends

It's the end of one month and the beginning of another so it's time for my favorite update: my dividend update.  These dividend updates reflect all dividends that I receive through my investing pursuits. I hope they can help inspire you to take control of your own finances and invest to build a passive income stream. What you use that stream for is up to you, whether it's to fund early retirement, just provide some FI/FU money, or even to provide for an annual vacation; the key is that it can provide options and open up all sorts of possibilities. You can check my dividend income or progress pages to see what dedication to an investment plan can give you.
What a crazy first half of 2020.  It hasn't been as smooth sailing for our investments; however, all things considered I'm not that upset about the few dividend cuts that I've received.  Hopefully the second half of the year will be easier going, but I don't have my hopes up for that.

My FI Portfolio produced $1,133.80 in dividends in June with my Folio First portfolio chipping in another $10.12.  My Roth IRA added $101.41 while my Rollover IRA contributed another $326.02.  That puts my taxable account dividends for June at $1,143.92 and the total for all accounts at $1,571.35.

Making Money While I Sleep

The power of joining the ownership class is that those companies can work much harder for you than you can.  Think about it.  By myself I have to devote my own time to my regular job in order to make money.  However by buying a stake in a high quality business I now get to leverage my own time that I exchanged for money into companies that are working around the clock to make products or provide services for their customers.  Those companies are working 24/7/365 which means that I make money even when I sleep.

During June the companies I own paid me $52.38 per day or $6.55 per hour assuming 8 hour work days every day of the month.  For the year those numbers are $30.64 per day and $3.83 per hour.

FI Portfolio

As I mentioned above my FI Portfolio produced $1,133.80 in dividends during June.  Compared to March that's a 5.5% decline although compared to June 2019 it's a solid 5.5% increase.  The quarter over quarter decline was due to the 3 of the companies I own having to cut their dividends in response to COVID.  

Compared to June 2019, the YTD total came in at a quite impressive 15.6% due largely to purchases made throughout 2019 and early 2020.

Roth IRA

My Roth IRA generated $101.41 in dividends for JUne.  That's a mediocre 0.3% increase from March but an excellent 74.0% year over year increase.

The YTD total through June 2020 shows a 51.0% increase compared to June 2019.

Rollover IRA

In March of last year I mentioned that I would start reporting on my Rollover IRA.  The bulk of those funds are invested in dividend growth companies, although there's a few that aren't, so to give the cleanest picture I will show just the dividend growth investments during my monthly reports.  That being said I'm not too worried about any particular month/quarter of dividends since my current plan is to be a bit more active with these funds than I would in my taxable accounts.  

Companies fall in and out of favor with market participants throughout the year and I want to attempt to capture some of that change in emotion.  If I feel a company is undervalued I'll purchase shares and won't sell until the story changes or the market price hits what I feel is at least 1.3x "fair value".  This is just a little experiment that I wanted to try and if I feel it's too much hassle or that I'm constantly taking 2 steps forward and 1 step back then I'll revert back to my bread and butter buy and hold strategy.

As such the time period comparisons are less important for this account since I want to take a more active approach.  

That being said, my Rollover IRA produced $326.02 in dividends during June which was a 0.5% increase from March.  The year over year comparison shows an excellent 32.2% increase with the YTD performance climbing 11.6%.

Dividend Raises During the Month

June was another slow month for dividend increases with just 2 raises being announced for the month.  Those 2 raises boosted my forward 12-month dividends by $10.88.  In the first half of 2020 I'v received 24 increases from 22 of the companies in my FI Portfolio increasing my forward 12-month dividends by a $199.99.

Dividend Increase Source

I've started breaking down the monthly dividend increase into its components: purchases, re-investment and dividend raises.  This lets me see what is the bigger contributor each month in my pursuit of financial independence.  I'm only tracking this for my main FI Portfolio since that is the portfolio that I want to ultimately provide the bulk of our income.
Purchases | Dividend Re-Investment | Dividend Raises | Financial Independence

The grand total for June was an increase of $45.51 with new purchases as the lead contributor to the monthly dividend increase.  Through the first half of 2020 my dividends have increased by $383.50 across all 3 sources with raises being the largest contributor by far.

Looking Forward

My forward 12-month dividends for my FI Portfolio ended June at $7,562.42 while my FolioFirst forward dividends are at $102.75.  That pushes the total taxable account forward 12-month dividends up to $7,665.17.  My Roth IRA's forward-12 month dividends increased to $696.05.  My Rollover IRA's forward 12-month dividends are at $2,964.72.  Across all 4 accounts, assuming no dividend cuts or position size changes, I can expect to receive at least $11,325.94 in dividends over the next year.

Monthly Average

The following chart shows the monthly dividend totals for each year that I've been investing as well as the monthly average.  It's not always an increase as some companies have weird payout schedules, as we saw above, and eventually some positions will get dropped, but the long-term trend is what matters.  

The rolling 12-month monthly average for my FI Portfolio is at $631.78 per month which is $44.67 or 7.6% above 2019's monthly average of $587.10.
dividend growth investing | dividends | financial independence | freedom

Dividends Received Breakdown

Dividends | Financial Independence | Dividend Growth Investing

I've updated my Dividend Income page to reflect June's changes.

How were your dividends in June?  What about for the 1H of 2020?  Have you had to deal with any dividend cuts?

Let me know in the comments below!


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