Dividend Update - September 2020
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.
The last quarter of each month is always a great time for most dividend growth investors, myself included, because many companies make their payment in that month. September being one of those months means that my dividend total was quite large compared to the other two months of the quarter.
In September my FI Portfolio produced $1,081.25 in dividends with my Folio First portfolio chipping in another $10.24. My Roth IRA added another $98.63 with my Rollover IRA generating $317.20. All told I received $1,091.49 across my taxable accounts and $1,507.32 for all accounts. All in all it was a great month!
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 a 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 September the companies I own paid me $50.24 per day or $6.28 per hour assuming 8 hour work days every day of the month. Year to date those numbers are $30.30 per day and $3.79 per hour.
FI Portfolio
As I mentioned above my FI Portfolio produced $1,081.25 in dividends during September. Unfortunately that's a 4.6% decline compared to June and a 1.9% decline compared to September 2019. While I've generally been happy with the performance of my portfolio and the dividend stream the quarterly and year over year declines are due to some suspensions and cuts due to the COVID-19 pandemic.
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 a 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 September the companies I own paid me $50.24 per day or $6.28 per hour assuming 8 hour work days every day of the month. Year to date those numbers are $30.30 per day and $3.79 per hour.
FI Portfolio
As I mentioned above my FI Portfolio produced $1,081.25 in dividends during September. Unfortunately that's a 4.6% decline compared to June and a 1.9% decline compared to September 2019. While I've generally been happy with the performance of my portfolio and the dividend stream the quarterly and year over year declines are due to some suspensions and cuts due to the COVID-19 pandemic.
Compared to September 2019, the YTD total is still showing a solid 11.4% increase which I'm pretty happy with. Things are still looking up and I'm moving forward with my goals despite the temporary setbacks.
Roth IRA
My Roth IRA generated $98.63 in dividends during September. That's a 4.6% decrease compared to June due to Wells Fargo's dividend cut; however, that's still a 6.6% increase compared to September 2019 due to additional investment, dividend re-investment and of course dividend growth.
The YTD total through September 2020 shows a 34.6% increase compared to September 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 $317.20 in dividends during September which was a 2.7% decrease from June due to my Corning shares being called away. Compared to September 2019 it's a decent 4.0% increase with the YTD total showing a huge 19.8% rise.
Dividend Raises During the Month
Since the COVID pandemic really ramped up, dividend increase announcements have been quite slow for the businesses in my FI Portfolio with only 12 total increases between March and August. However, as things have normalized some that brought about a return of dividend growth with 6 companies in my FI Portfolio announcing raises during September boosting my forward 12-month dividends by $29.95. In total I've received 34 raises YTD increasing my forward dividends by $244.19.
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.
The grand total for September was an increase of $88.47 with new purchases leading the way although re-investment and raises were solid as well. Through the end of September dividend increases have been the biggest source of "new" dividends for me with purchases coming in second. My dividends have increased by $533.53 for my FI Portfolio across all 3 sources through the end of September.
Looking Forward
My forward 12-month dividends for my FI Portfolio ended September at $7,428.84 while my FolioFirst forward dividends are at $104.53. That pushes the total taxable account forward 12-month dividends up to $7,533.37. My Roth IRA's forward-12 month dividends are at $666.12. My Rollover IRA's forward 12-month dividends are at $3,021.29. Across all 4 accounts, assuming no dividend cuts or position size changes, I can expect to receive at least $11,220.78 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 $636.62 per month which is $49.52 or 8.4% above 2019's monthly average of $587.10.
Roth IRA
My Roth IRA generated $98.63 in dividends during September. That's a 4.6% decrease compared to June due to Wells Fargo's dividend cut; however, that's still a 6.6% increase compared to September 2019 due to additional investment, dividend re-investment and of course dividend growth.
The YTD total through September 2020 shows a 34.6% increase compared to September 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 $317.20 in dividends during September which was a 2.7% decrease from June due to my Corning shares being called away. Compared to September 2019 it's a decent 4.0% increase with the YTD total showing a huge 19.8% rise.
Dividend Raises During the Month
Since the COVID pandemic really ramped up, dividend increase announcements have been quite slow for the businesses in my FI Portfolio with only 12 total increases between March and August. However, as things have normalized some that brought about a return of dividend growth with 6 companies in my FI Portfolio announcing raises during September boosting my forward 12-month dividends by $29.95. In total I've received 34 raises YTD increasing my forward dividends by $244.19.
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.
Looking Forward
My forward 12-month dividends for my FI Portfolio ended September at $7,428.84 while my FolioFirst forward dividends are at $104.53. That pushes the total taxable account forward 12-month dividends up to $7,533.37. My Roth IRA's forward-12 month dividends are at $666.12. My Rollover IRA's forward 12-month dividends are at $3,021.29. Across all 4 accounts, assuming no dividend cuts or position size changes, I can expect to receive at least $11,220.78 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 $636.62 per month which is $49.52 or 8.4% above 2019's monthly average of $587.10.
Dividends Received Breakdown
I've updated my Dividend Income page to reflect September's changes.
How have your dividends fared throughout the last 6 months? Continuing to see great year over year growth or have you been hit with some dividend cuts?
Let me know in the comments below!
How have your dividends fared throughout the last 6 months? Continuing to see great year over year growth or have you been hit with some dividend cuts?
Let me know in the comments below!
Really interesting article, and I enjoyed reading the rest of your site too!
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