Dividend Update - October 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.

October wasn't nearly as good for dividends as September; however, it was another steady march higher.  My FI Portfolio 
produced $427.33 in dividends with my Folio First portfolio chipping in another $9.06.  My Roth IRA added another $53.12 with my Rollover IRA generating $191.32.  All told I received $436.39 across my taxable accounts and $680.83 for all accounts.  

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 October the companies I own paid me $21.96 per day or $2.75 per hour assuming 8 hour work days every day of the month.  Year to date those numbers are $29.45 per day and $3.68 per hour.

FI Portfolio

As I mentioned above my FI Portfolio produced $427.33 in dividends during October.  That's a solid 3.5% increase from July and a 11.3% increase compared to October 2019.  

Compared to October 2019, the YTD total is still showing a solid 11.4% increase which I'm pretty happy with.

Roth IRA

My Roth IRA generated $53.12 in dividends during October which is a solid 2.0% increase compared to July and an even better 9.2% increase compared to October 2019.

The YTD total through October 2020 shows a 31.7% increase compared to October 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 $191.32 in dividends during October which was a 1.7% increase from July.  Compared to October 2019 it's a whopping 396.0% increase with the YTD total showing a huge 26.8% rise.  Much of the year over year and year to date rise is due to capital being invested over the last year rather than being tied up in options.

Dividend Raises During the Month

October was another ho-hum month for dividend increases.  However, I did still receive 2 dividend raises during the month increasing my forward 12-month dividends by $13.63.  Through the end of October I've received 36 total increases boosting my forward 12-month dividends by $257.74.

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.
Dividend | Purchase | Stocks | Dividend Growth | Reinvestment

The grand total for October was an increase of $73.34 with new purchases leading the way and re-investment and raises contributing roughly the same amount.  Through the end of October dividend increases have been the biggest source of "new" dividends for me with purchases coming in a close second.  My dividends have increased by $606.88 for my FI Portfolio across all 3 sources through the end of October.

Looking Forward

My forward 12-month dividends for my FI Portfolio ended September at $7,529.27 while my FolioFirst forward dividends are at $104.46.  That pushes the total taxable account forward 12-month dividends up to $7,633.73.  My Roth IRA's forward-12 month dividends are at $668.30.  My Rollover IRA's forward 12-month dividends are at $3,092.72.  Across all 4 accounts, assuming no dividend cuts or position size changes, I can expect to receive at least $11,394.75 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 $640.23 per month which is $53.13 or 9.0% 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 October's changes.

Are you still on track to meet your dividend goals with just 2 months remaining?

Let me know in the comments below!