Dividend Update - February 2023 #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.

February was definitely a step back compared to January's results; however, that's the usual trend for my portfolio.  The 3rd month is the strongest, followed by the 1st, and the 2nd month is always the lowest each quarter.  

That being said I'm still very happy with February's results.  My FI Portfolio produced $511.76 for the month with my Loyal3 FolioFirst Interactive Brokers portfolio chipping in another $6.25.  My Roth IRA added $51.37 and my Rollover IRA generated $282.48.  For the month I received $518.01 across my taxable accounts and $851.86 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 February the companies I own paid me $30.42 per day or $5.32 per hour assuming 8 hour work days 5 days a week.  YTD that's $35.90 per day and $6.28 per hour.  

FI Portfolio

As I mentioned above my FI Portfolio produced $511.76 in dividends during February which is a solid 8.3% increase compared to February 2022.  The YTD results compared to 2022 have 2023 coming in 24.9% higher.

Roth IRA

My Roth IRA had another steady as she goes February surpassing $50 in dividends received.  Compared to February 2022 that's a strong 10.4% increase which is even more impressive since the rise was solely from organic dividend growth and reinvestment of dividends.  The YTD results have 2023 22.8% ahead of 2022 through February.

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 a total of $282.48 in dividends during February which is modest 4.5% increase compared to February 2022.  The AT&T dividend cut is still weighing on the results, although that should be done with by Q2, and accounted for the decline.  Normalizing to exclude AT&T's dividends from both periods and February 2023 came in 21.2% higher than 2022.  

The YTD results through February have 2023 at a 5.6% decline compared to the same period in 2022.  However there's distortions in those numbers due to AT&T, my decision to close a position last year, and one of the companies I owned getting acquired and the dividend pay date changing.  On a normalized comparison the YTD results for 2023 are 17.9% ahead of 2022.

Dividend Raises During the Month

January started 2023 off quite slow in terms of dividend increases; however, February was a gangbusters month for increase announcements.  In total there were 17 increases from my FI Portfolio holdings during February.  Combined the announced raises boosted my forward 12-month dividends by $160.02.

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

February was another slow month for purchases; however, I'm quite happy with the results through the first two months of 2023 considering that we've contributed no fresh capital to our FI Portfolio this year.  That's not for fear of the markets or anything rather just that the start of each year comes with a decent sized property tax bill plus we're also hoarding cash for other potential opportunities outside of the stock market.  Considering we're still averaging over $100 per month increases to our forward 12-month dividends with no new capital investments, the results have been fantastic.

Luckily dividend growth investing isn't built to rely solely on one source of dividend growth.  When one is lacking you can still rely on the other two to help you out and in February they certainly did the heavy lifting.  

Dividend increases have carried the weight thus far in 2023 with over a $150 per month average.  That's going to come down as the year goes on, but solid results nonetheless.   

That's what's really cool about finally hitting some scale with your investments and dividends.  Dividend reinvestment and organic dividend growth can do the heavy lifting for you and eventually will far surpass what you can do with savings alone.

Looking Forward

My forward 12-month dividends for my FI Portfolio ended February at $11,480.35 while my Loyal 3 FolioFirst Interactive Brokers forward dividends are at $239.22.  That pushes the total taxable account forward 12-month dividends up to $11,719.57.  My Roth IRA's forward-12 month dividends are at $1,103.46.  My Rollover IRA's forward 12-month dividends are at $4,633.04.  

Across all 4 accounts, assuming no dividend cuts or position size changes, I can expect to receive at least $17,456.07 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 February at $880.54 per month which is $24.52 higher or a 2.9% increase compared to 2022's monthly average of $856.02.
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 February's changes.

Are you on track to meet your dividend goals for 2023 now that 2 months are in the books? 

Let me know in the comments below!