Another month has passed by, and it’s time for me to post an article on my favorite subject: dividend income. The reason why I love to post articles on dividend income is because it’s pure numbers. It’s hard to argue the success of long-term dividend growth investing when you can slowly and surely see dividend income rise over time and get closer to covering one’s expenses.
June was just a monster month for dividend income. I feel so incredibly blessed that the me of more than four years ago took it upon himself to change his future, because the me of today is certainly benefiting from that vision. Hard work goes a long way. Sprinkle in some luck and you can truly change your reality.
I hope these monthly dividend income reports provide inspiration for any investors out there that are just starting out. It’s easy to see these payments rising month after month and it shows that it’s possible to one day pay for monthly expenses with dividends, which would provide an investor opportunities and freedom to pursue other interests than full-time work. Without further ado:
June 2014 Dividend Income Update
- ConocoPhillips (COP) – $37.95
- Aflac Incorporated (AFL) – $37.00
- Phillips 66 (PSX) – $13.50
- Wal-Mart Stores, Inc. (WMT) – $18.24
- Wells Fargo & Co. (WFC) – $31.50
- Southside Bancshares, Inc. (SBSI) – $14.70
- Emerson Electric Co. (EMR) – $25.80
- International Business Machines Corp. (IBM) – $11.00
- Johnson & Johnson (JNJ) – $70.00
- Chevron Corporation (CVX) – $42.80
- Lorillard Inc. (LO) – $30.75
- Norfolk Southern Corp. (NSC) – $37.80
- Target Corporation (TGT) – $30.10
- Exxon Mobil Corporation (XOM) – $13.80
- Harris Corporation (HRS) – $16.80
- Avista Corp. (AVA) – $17.46
- American Realty Cap. Prop. Inc. (ARCP) – $14.17
- McDonald’s Corporation (MCD) – $48.60
- Realty Income Corp. (O) – $12.77
- BP Plc (BP) – $46.80
- Royal Dutch Shell Plc (RDS.B) – $23.50
- Digital Realty Trust, Inc. (DLR) – $53.95
- PepsiCo, Inc. (PEP) – $50.44
Total dividends received during the month of June: $699.43
That was almost the second time I’ve exceeded $700 in dividend income for a month, but I missed the mark by a little more than 50 cents. Oh, so close!
But what a month! This kind of dividend income can make a serious dent in one’s expenses, even before financial independence is reached. As I’ve previously written about, dividend income doesn’t necessarily have to be untouchable. Although it’s obviously more desirable to continue reinvesting the dividend income, $700 could right now pay for all of my monthly costs related to: rent, cell phone, food, fuel, and health insurance. Bam! That’s a significant portion of my bills right there. And that’s the power of dividend income, folks. The tangibility makes the progress real, which is wonderful because bills are also very real.
This month’s performance was a 26.4% improvement over the dividend income I received in June 2013. I love that kind of YOY change, but I also know the gains in percentage terms will continue to fall as my income rises. A good problem to have, of course.
I was able to cover a full 47% of my personal expenses this past month via dividend income alone. That’s simply phenomenal. I know that I can’t reach that kind of expense coverage every month, as June was a big month for dividend income and I was also extremely diligent in watching expenses this past month. But these kinds of numbers show this strategy is real and it is indeed very possible to become financially independent via dividend income. Once your expenses are covered for you with no further work on your part, your time is your own and you can live your life however you want. You can retire off to a life of leisure, volunteer your time, build something, or start a second career. Or you can just continue doing what you’re already doing. It really doesn’t matter. What does matter is that you have a choice. You’re not forced into doing anything that you don’t really want to do.
Looking forward, July is usually one of my weakest months of dividend income. I expect to receive less than half of what I received this month, but that’s fine. It’s just another step on the compounding journey to financial independence.
One of my goals for 2014 is to receive $5,200 in dividend income for the year. Now that six months are behind us, I can see where I’m at as we cross the midway point of the year. I’ve received $2,802.52 in dividend income for the year through six months. That means even with no further investments I should exceed my goal, but I’m now looking to see just how much I can crush this thing. As an aside, I’ve now received more in dividend income through the past six months than what I received in all of 2012. I’ve completed 53.9% of my goal, so let’s see how far above 100% I stand when December closes out. I’m anxious to continue making investments in high-quality dividend growth stocks as valuations and allocations make sense.
I’ll update my dividend income page to reflect June’s dividends.
Full Disclosure: Long all aforementioned securities.
How was June for you? Did you knock it out of the park?
Thanks for reading.
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