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.
July was just another snoozer of a month where I received passive dividend income from high quality companies simply for making great decisions many yesterdays ago. The wonderful thing with dividend growth investing, and investing in general, is that making one great decision will likely reap big rewards for many tomorrows to come. Dividends are simply a gift that keeps on giving!
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:
- The Coca-Cola Company (KO) – $22.40
- Illinois Tool Works Inc. (ITW) – $13.30
- Altria Group Inc. (MO) – $22.88
- Philip Morris International Inc. (PM) – $85.00
- Realty Income Corp. (O) – $7.26
- Medtronic, Inc. (MDT) – $10.36
- Sysco Corporation (SYY) – $8.12
- The Bank of Nova Scotia (BNS) – $12.40
Total dividends received during the month of July: $181.72
Not one of my biggest months ever, but not every month will be or needs to be. The key is to build this passive income slowly and surely, and reinvest this passive cash flow selectively into attractively valued companies. The dividends then essentially buy more dividends, which fuels even more passive income which grows not only by reinvestment (buying more shares) but also organically via the dividend raises high quality companies give their shareholders. It’s growth supercharged!
This was a nice improvement upon the $145.69 in dividends I received back in July 2012. This difference represents an increase of 24.7%! Onwards and upwards!
I was able to cover right about 11% of my expenses via dividends during this past month. Not bad! Another way to look at it is that I was able to pay for my groceries and my cell phone bill by way of dividends, and I still had some walking-around money left over.
My goal is to receive $3,500 in dividends during the year of 2013. We’re now seven months deep into this year, and my portfolio has generated $1,905.12 in dividends so far. That means I’m 54.4% of the way to my goal just over halfway through the year. I believe I’m going to exceed my goal, so let’s see how it goes!
I’ll update my dividend income page to reflect July’s dividends.
Full Disclosure: Long all aforementioned securities.
How was your July? Another fantastic month of dividend income?
Thanks for reading.
Photo Credit: sscreation’s/FreeDigitalPhotos.net
You go dude!!
Hi DividendMantra, yet another nice update. Keep ’em coming!
Anonymous,
You go too! 🙂
Thanks for the support. I appreciate it. 🙂
Cheers!
Robin,
Thank so much! Another boring month of income I didn’t have to work for. Boring is good!
Best of luck on your journey as well!
Take care.
Ispiring update. Can you recommend any sites or resources for someone just getting started?
Awesome sauce! Pretty nice bump when compared to last year’s July. At this rate you should be able to hit your target $3K5 by year’s end 😀 Last month was good for me as well. Glad to see a Canadian bank within your holdings 8) They are the most international bank we have up here with more than 40% of revenue earned from outside of the country 🙂 I own a little bit of BNS too. #GoCanada lol
I thought about today as I drank my one a day Diet Coke I down to only one a day. Just trying to do my part to help you retire early (I own KO also)
Jason, do you hold also ETFs, bonds, GIC, HISA … or only stocks?
Ah, my favorite series. This was not my biggest month either due to a bit of an artifact. But as you say, it’s all about staying the course and just letting the dividends pile up. Some months will be big, some will be small, but on acreage things will be fine. September should be a good month for everyone, looking forward to it.
Hello,
I very much enjoy reading your articles. The outlined reasoning behind your recent purchases are particularly useful. I was wondering if you would consider writing some articles describing your reasoning, approach to your entire portfolio, if any. Do you monitor the portfolio beta, percentage industry/sector allocation, percentage geographic allocation ? Many of your articles stress the utmost importance of buying single quality companies one at a time, a first step that I have taken myself. But as my own portfolio has grown to 29 dividend paying stocks I regularly monitor the overall beta, YOC, cap size, industry allocation. The exercise has proven useful as it guides me to buy quality stock that allow to rebalance a perceived weakness in the portfolio. Your blog is generally cerebral and I would be grateful if you could serve us a plate of grey matter portfolio management. Cheers !
Sounds like a solid month for you – a year over year increase of nearly 25% is worth celebrating, just think where you will be in a few years if you keep that pace of growth up
Cheers!
Michael
Nice bump from last July’s $145. Congrats!
It goes so fast. Another month gone! I like your achievement and your dividend income. I made a purchase this Friday which moved me closer to my $100 monthly income goal, but still not there yet.
At last! The dividend income posts is “my fix of the month”!
Take care! The Swede.
DM,
Another solid month of dividends! Look forward to watching as you exceed your goals.
Inspiring stuff!
I’m feeling more fired up about gathering my own freedom fund. I recently figured out how to push my savings rate up to 55 per cent from the 50 per cent level I’ve hovered at for 2-3 years now.
Your site is more of a ‘complete package’ than most. It’s not simply about dividend growth investing. It’s also about choosing your path instead of drifting through life. I’m 34 years old and I hope many people in their twenties read this. It would have done me good.
Keep up the good work. This is a public service in itself.
DM,
Congrats! It’s great to see steady progress. DGI isn’t exactly a get rich quick method but it’s a tried and true method. You’re hitching your wagons to some of the best run companies in the world.
$180 in a secondary month is pretty amazing. July typically has much fewer companies paying out so that’s a very solid total. I’m looking forward to the end of year write up to see how much you beat your goal by. With all the purchases you’ve been making lately I’m sure you’ll be passing that.
I wish $181 was a low month for me too. That’s still a 24% improvement over last year which is great. Imagine getting those results each and every year how that will compound growth. Gotta love that kind of power.
Also as far as July payers go would you consider buying any of theses names you own at the moment? Or do you have your eyes on some other names, perhaps a KRFT, SWY, or GE. Just curious.
Tom,
Thanks for stopping by. Just starting out may be the most exciting part of the journey. A whole new world awaits you.
I wrote a post not long ago to address beginners:
http://www.dividendmantra.com/2013/04/dividend-investing-for-beginners.html
Best of luck to you!
Cheers!
Liquid,
Thanks! Yeah, it was a nice bump from last year. I won’t be able to keep up growth like that over the long haul as the numbers get bigger, but it’s nice when it does happen.
I like BNS. The international diversification is exactly why I purchased it. While the Canadian market has historically been very stable, Canada currently has a very hot real estate market (perhaps in a bubble) and the growth of jobs has stalled lately. The more exposure to international markets, the better (in my opinion).
Best regards!
Roadmap2Retire,
Thanks a lot! It’s been very nice so far. The journey has been kind to me.
It looks like you’re doing very well too. Good luck on your goal to achieve $2k in passive income this year! 🙂
Take care.
Anonymous,
Thanks so much for supporting one of my investments! 🙂
I also drink a lot of Coca-Cola (not diet). It’s one of my vices in life. I don’t smoke, I very rarely drink alcohol and I try to exercise as much as I can. But I do love my Coke! 🙂
Best wishes!
gibor,
What you see in my portfolio is everything I own, other than short-term cash in my checking account which can vary in amount from month to month.
I eventually plan on owning bonds, but only when interest rates have risen substantially from here.
Best regards!
Spoonman,
It’s definitely about staying the course and just reinvesting the dividend income. You have it nailed down.
September should definitely be a good month. I may even approach $600. We’ll see how it goes. Although smoother payouts (less bumpiness from month to month) isn’t a priority for me due to my extreme budgeting, I would like to see smoother payouts over time. I’m not taking an active approach there, but there are a few companies I’d love to own that pay on off months (like GIS, for example).
Stick to the plan and keep up the great work!
Best wishes!
Anonymous,
I can write an article like that. No problem at all. I don’t think I’ve addressed that question to date.
To be quite honest, I don’t necessarily track overall beta, cap size and industry or sector allocation. Doing so would somehow require me to compare myself to an index to make the numbers meaningful. And I don’t really compare myself to an index. For instance, I’ll likely have a larger allocation to consumer companies (like KO, PEP, PM) than an index because that’s where the secular companies that have long track records of dividend growth are typically found. I look at high quality companies with long standing histories of rewarding shareholders via dividends and growth of dividends that are trading at attractive valuations. If I find a company that fits my criteria, I purchase even if it causes an allocation issue.
Furthermore, I’ll likely have a smaller allocation to sectors that typically experience more “boom and bust” histories due to cyclical natures and leverage. The finance sector would be a good example.
I think the most important thing to focus on is the quality of companies rather than metrics that compare you to someone else. After all, we’re all just trying to meet goals that are specific to our individual situations. Therefore, the S&P 500’s allocation to energy or finance really matters little against my own aspirations.
I hope that helps a little!
Best regards.
Michael,
Thanks for stopping by. I appreciate the support!
25% YOY growth is fantastic. I know that I won’t be able to keep that up, because as the numbers grow the percentages will in turn fall. But that’s okay. The big picture is what I tend to focus on.
I hope you had a great July as well! 🙂
Take care.
Martin,
I wish you the best of luck as you get closer to your mark of $100/mo. It wasn’t that long ago that I hit that milestone myself. It does go by quickly, as you mention. It’s because time goes by so quickly that I’m doing all of this. I can’t wait for the day when I’m able to slow time down. 🙂
Best regards!
SWAN,
Thanks for the support! Much appreciated.
Another solid month of dividends for all of us. I hope you continue to exceed your goals as well!
Best wishes.
The Swede,
I’m glad I could accommodate! 🙂
Thanks for stopping by!
Best regards.
Anonymous,
Great stuff! A 5% bump in your savings rate will have a big effect over the long haul. And a 50% savings rate in itself is huge. Keep up the great work!
I’m glad you enjoy the blog. I never intended to write only about dividend growth investing. While I find it intensely interesting, my life is about more than that. I have these big dreams and goals and I can only hope that by sharing them and my journey toward them I inspire others. I find so many things in life beautiful, and I try to share some of that optimism here. As I evolve as a person, and as my interests change and grow, I plan on sharing all of that here as well. For instance, if I decide to engage in long-term travel, that would be something I’d love to share. This blog is really more a reflection of me and my inner thoughts than anything else.
Thanks for stopping by and I’m glad you enjoy a little slice of my life!
Best wishes.
Pursuit,
You’re right. DGI definitely is not a get-rich-quick scheme, but it is a get rich plan. Time is an important ingredient, and the more of it you add to the recipe the bigger batch of wealth you’ll end up with at the end!
I think I will exceed my goal this year. September and December look to be fairly large, and those two months alone will go a long way toward getting me to my $3,500 mark. It’s exciting. I can’t wait to see how 2013 ends up!
You’re doing phenomenal as well. Your large income and consistent ability to keep your expenses low is having a huge impact in your ability to build wealth. Keep it up!
Best wishes.
Captain,
I still remember the days when I was getting $30 for a month and I was super excited. I’m not far removed from those months. The progress can happen quickly if you stick with it. You’ll see. 🙂
As far as purchasing more of the stocks listed above, I think the only one I wouldn’t be interested in right now is SYY. I think BNS is probably the most attractively valued of all, but does carry some risk of the aforementioned Canadian real estate market and broader economy. PM looks very nice here. In fact, if PM wasn’t already one of my biggest positions I’d be buying here.
Cheers!
PM is also one of my biggest holdimgs, but I still will be seriously considering adding more shares if it drops to $87’s
I just initiated my first position in PM at 100 shares around 88.5 🙂
oh and also with PM, me and director mackay graham purchased same day, except his purchase was for over 11 million, and i got a little better entry point then he 🙂 :). I love seeing insider buys, especially one as large as 11 million.
gibor,
I’m very bullish on PM. They’ve had some short-term issues hurting the stock price including currency exchange rates and a new tax in the Philippines. However, over the long haul I think this company will do very well. I’d love to pick up more, but it’s just tough for me to do with it already making up around 7% of my portfolio.
Best wishes!
Took2Summit,
Nice buy there. It looks like we both own 100 shares of this great company. Nice to have you as a fellow shareholder! 🙂
I’d like to pick up another 20 shares or so here, but as I was saying earlier it’s just tough for me to do so right now. If the weighting in my portfolio fell a bit due to either a lower price or me picking up shares in other companies I’d be very interested in buying more. Over the long-term I’d really like to allocate no more than 5% to one company as an absolute maximum, and preferably closer to 3%. I love PM, but I also love mitigating risk.
Best regards!
wes,
Thanks. I really appreciate it. Very kind of you! 🙂
I hope your snowball is rolling downhill as well now. Let’s turn it into an avalanche!
Take care.
Nice to see that snowball growing DM. Keep it up man, you’re doing fantastic!
Yes, 7% for 1 stock may be too much… My PM holding is about 3.7% , sharing 3rd place with TD. My maximum allocation to one stock is less than 5%
Great job! Just found your site, but I think I saw a story about you on NBC a while back.
I have some MO. PM sounds good too. I might have to pick up a few shares. I need to do a dividend update on my site too. It’s been a while since i’ve done that.
Great Job DM! Are you thinking of adding to your position of O (Reality Income Corp)? It is looking attractive around $43.
Joe,
Hey, thanks for stopping by!
I’d love to see a dividend update from you. I know the dividend income makes up a pretty significant portion of your passive income.
Great job with the online income. You’re killing it there!
Stay in touch. 🙂
Best wishes.
Anonymous,
I like O here, but I’d prefer to average down when it’s about 10% below my purchase price. That would mean O would be trading for about $40 per share. At that price level I’d definitely be interested in adding more. If I didn’t already have a position, I’d buy here.
I think it’s attractively valued, but I don’t want to load up and watch it fall. I’d rather buy in increments, and preferably in cheaper increments. 🙂
Best regards!
Wow, a 24% YOY increase is great. I’m jealous of that large PM dividend you’ve got. Keep up the good work and I look forward to seeing you hit your goals this year!
AAI,
Thanks! I appreciate it. I’m only trying to keep up with you, which I’m overwhelmingly failing at. 🙂
The dividend from Philip Morris is quite large, but I’m actively building up the rest of the portfolio around it as PM is, right now, a little too large for my comfort level in terms of weighting within the portfolio. I’d feel better once PM is 5% or less of the portfolio.
Keep up the great work on your end too! Looking forward to seeing your huge September!
Take care.