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 publish articles updating my 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, getting closer to covering one’s expenses.
April was just another big step in the right direction. A total of 14 different high-quality businesses sent me a check over the course of the month. Why? Because I bought stock in these businesses at some point in the past. And that’s what’s so amazing about all of this. You can make one great decision in your life – buy stock in a great business that pays a dividend and regularly increases it – and that one decision can literally reward you with growing passive income for the rest of your life. Repeat that with many subsequent great decisions to buy more stock in great businesses that pay and grow dividends and you’ll eventually likely find yourself drowning in so much passive income that you’ll find it difficult to spend it all.
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 interests other than full-time work. Without further ado:
- The Coca-Cola Co. (KO) – $46.20
- Baxter International Inc. (BAX) – $31.20
- Wal-Mart Stores, Inc. (WMT) – $18.62
- Omega Healthcare Investors Inc. (OHI) – $21.60
- Illinois Tool Works Inc. (ITW) – $16.98
- Philip Morris International Inc. (PM) – $115.00
- Altria Group Inc. (MO) – $41.60
- Realty Income Corp. (O) – $13.27
- Medtronic PLC (MDT) – $11.29
- T. Rowe Price Group Inc. (TROW) – $40.00
- Armanino Foods of Distinction Inc. (AMNF) – $14.40
- General Electric Company (GE) – $39.10
- Bank of Nova Scotia (BNS) – $22.58
- Raytheon Company (RTN) – $16.75
Total dividends received during the month of April: $448.59
I’m still in shock. I mean I knew I was going to be in this spot because I spent time forecasting my dividend income out all the way until 2022 when I first started investing. So this was an eventuality. As I’ve previously stated, I’m already financially independent – I’ve visualized it already happening. So I’m basically now just bridging the gap between the me of today that’s not free and the me of 2022 who is completely financially free. But it’s still amazing seeing the dividend income add up to well into the hundreds of dollars in a single month in the here and now. It’s one thing to anticipate something happening and quite another to actually live through it.
What could an extra $450 do for you? What could this kind of passive income do for anyone? What bills could that cover right now? It’s amazing, isn’t it? That’s basically 45 hours of work at $10 per hour, except I didn’t have to work for any of it. Fortunately, my extra little worker in the house did – and sent me all the checks.
What these continuing results show is that this isn’t hard. I don’t make a lot of money. Never have. Probably never will. And I’ve made a ton of mistakes (which I spell out in my book) leading up to turning my life around a few years back. But yet here I am in 2015 collecting substantial passive income at 32 years old. And you can be here as well. We all can!
This month’s total is 43.8% higher than the dividend income my Freedom Fund generated in April 2014. However, there are a couple of caveats there. First, OHI paid out an unusual prorated dividend in April due to an acquisition. Second, TROW paid a special dividend this year which may not persist annually. Third, I’ve decided to stop backing out the foreign withholding from Canadian stocks (and any others in the future) since I’m reimbursed all of that at tax time via a tax credit. These are gross reports anyway, so it doesn’t make sense to not report income I’m actually receiving (albeit at a later date). Either way, it’s a negligible difference at this point.
I was able to cover 19.9% of my personal expenses this past month via passive dividend income alone. That’s a pretty incredible result, in my view, when considering that I paid for a wedding and a 50th birthday party. In addition, some of the costs relating to our Omaha trip were realized in April (the hotel will be realized in May). Not too bad!
I’m very, very happy with the dividend income for April. Mr. Market is moody – sometimes he’s in a great mood and stocks are expensive. Other times he’s miserable and stocks are cheap. As such, my portfolio (and probably yours as well) oscillates quite a bit, sometimes violently. But the dividend income keeps on coming in like clockwork. How can you not like that?
I’ve been very active thus far this year in terms of additional stock purchases through the use of fresh capital and reinvested dividend income. And I expect that to continue for the foreseeable future. So I anticipate future dividend income to be that much greater.
One of my goals this year is to receive $7,200 in dividend income during this calendar year. Four months are now complete and in the books, and with that I can say that the portfolio has generated $2,202.18 in dividend income thus far this year, which is an average of $552.05 per month. That average, by the way, covers the entire cost of my rent and utilities. That means that no matter what I’ll always have a roof over my head. What an amazing feeling. The dividend income the portfolio has generated YTD is 30.6% of my goal, so I think I’m more or less on pace here. Continued aggressive investments throughout the summer should get me over the hump. Stay tuned!
I’ll update my Dividend Income page to reflect April’s dividends.
Full Disclosure: Long all aforementioned stocks.
How was April for you? Was the dividend income what you were expecting? On pace for your goals this year?
Thanks for reading.
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