Dividend Update - May 2022 #Dividend

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.

2022 has definitely brought about the return of volatility to the markets.  The S&P 500 was down nearly 8% during May at it's lowest, but ended up with a miniscule 0.01% gain for the month.  Go figure.

That's the big reason that we're aiming to build a portfolio such that we the dividends it generates can cover the expenses for our lifestyle.  Our dividends continued to show a steady upward climb during May even though the share prices were nowhere near as consistent.

During May, my FI Portfolio produced $461.89 in dividends with my Loyal3 FolioFirst Interactive Brokers portfolio chipping in another $6.25.  My Roth IRA added $61.23 and my Rollover IRA generated $240.33.  For the month I received $468.14 across my taxable accounts and $769.70 across 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 May the companies I own paid me $24.83 per day or $4.35 per hour assuming 8 hour work days.  While YTD those are $37.16 and $6.50, respectively.  

FI Portfolio

As I mentioned above my FI Portfolio produced $461.89 in dividends during May which was an excellent 24.8% increase compared to May 2021.  Considering that that includes the effects of the dividend cut from AT&T (T) I'm pretty happy with the results.  The YTD performance for 2022 is also showing a very strong 26.8% increase versus 2021.

Roth IRA

My Roth IRA generated $61.23 in dividends during May which represents a 36.3% increase versus 2021.  The year over year increase was due to all three legs of the dividend growth stool: dividend growth, dividend reinvestment, and new purchases.  The YTD comparison shows an equally impressive 30.8% increase compared to 2021.

Rollover IRA

In March of 2019 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.  

My Rollover IRA produced $240.33 in dividends during May which is a 6.9% increase versus May 2021.  The paltry year over year comparison was also due to the dividend cut from AT&T.  The YTD comparison still showed a very strong 18.4% increase as well compared to the same period in 2021.

Dividend Raises During the Month

May continued the steady trend for dividend increases with 5 more being announced during the month.  Those five companies in my FI Portfolio combined to raise my forward 12-month dividends by $58.53.

I love dividend increases because it means (1) the company is doing better and (2) I get paid more while doing absolutely nothing.  That's about as good as it gets.  Year to date in 2022 I've received 29 raises that have increased my forward 12-month dividends by a combined $275.83.

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

We're on a bit of a roll now with a great month of May in terms of increasing our expected dividends.  During the month we had a net increase to our dividends of $236.65 with purchases by far leading the way.  The reduction in dividends from sales were due to a handful of smaller scale sales of my ESPP shares with the proceeds being re-invested within the portfolio.

Through the first 5 months of 2022 purchases have widened their lead with $604.59 in additional forward dividends.  Of course the sales are also a $186.90 headwind putting the net gain from purchases at a still respectable $417.69.  Raises are firmly in second place with an increase of $275.82.  Dividend reinvestment is well behind because while I do reinvest all my dividends it's just that most of them are taken in cash rather than DRIPped.  

All in all despite the sales and one big dividend cut I'm still at a net increase of $646.50 to my forward dividends through the first five months of 2022 and the monthly average now sits at $129.30.  If we can maintain a $106 increase on average for the last 7 months of the year we should be able to cross into the $11k+ forward 12-month dividends which is the next round number milestone on our journey.

Looking Forward

My forward 12-month dividends for my FI Portfolio ended May at $10,261.78 while my Loyal 3 FolioFirst Interactive Brokers forward dividends are at $185.03.  That pushes the total taxable account forward 12-month dividends up to $10,446.81.  My Roth IRA's forward-12 month dividends are at $1,025.43.  My Rollover IRA's forward 12-month dividends are at $4,466.12.  Across all 4 accounts, assuming no dividend cuts or position size changes, I can expect to receive at least $15,938.36 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 ended May at $762.57 per month which is $63.79 higher or a 9.1% increase compared to 2021's monthly average of $698.78. 
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 May's changes.

Despite a volatile stock market how are you progressing on your dividend goals for the year?  

Let me know in the comments below!