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 that 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.
A new all-time record for dividend income was hit this past month!
While breaking records for monthly dividend income will be something that a dividend growth investor routinely does if they’re regularly adding fresh capital and reinvesting dividend income, this record is special for a big reason, as you’ll see below.
I’m so incredibly proud of the progress I’ve made thus far over the last five or so years. This shows what is actually possible in real-time, guys. For most of the time I’ve been at this, I worked at a regular day job. I spent all day and all night toiling away, consistently saving, trying to figure out how to build a sizable passive income stream that could one day fund all of my expenses. And this month proves just how close I’m getting to that dream.
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. What you’ll see below is a list of every dividend I collected over the prior month, which company paid the dividend, and the amount of the dividend. Without further ado:
- Wells Fargo & Co. (WFC) – $33.75
- Visa Inc. (V) – $2.40
- Phillips 66 (PSX) – $15.12
- ONE Gas Inc. (OGS) – $2.40
- ConocoPhillips (COP) – $40.70
- Aflac Incorporated (AFL) – $39.00
- Southside Bancshares, Inc. (SBSI) – $17.02
- Wal-Mart Stores, Inc. (WMT) – $22.05
- Johnson & Johnson (JNJ) – $75.00
- Unilever PLC (UL) – $32.32
- Target Corporation (TGT) – $39.20
- Norfolk Southern Corp. (NSC) – $41.30
- International Business Machines Corp. (IBM) – $19.50
- Exxon Mobil Corporation (XOM) – $14.60
- Emerson Electric Co. (EMR) – $37.60
- Chevron Corporation (CVX) – $42.80
- Microsoft Corporation (MSFT) – $7.75
- United Technologies Corporation (UTX) – $9.60
- Hershey Co. (HSY) – $8.75
- ITC Holdings Corp. (ITC) – $5.63
- Avista Corp. (AVA) – $18.15
- Praxair, Inc. (PX) – $7.15
- Realty Income Corp. (O) – $13.30
- McDonald’s Corporation (MCD) – $51.00
- BP PLC (BP) – $47.60
- Royal Dutch Shell PLC (RDS.B) – $23.50
- Harris Corporation (HRS) – $20.00
- National Oilwell Varco, Inc. (NOV) – $39.10
- Gilead Sciences, Inc. (GILD) – $4.30
- T. Rowe Price Group Inc. (TROW) – $13.00
- Travelers Companies Inc. (TRV) – $6.10
- Union Pacific Corporation (UNP) – $27.50
- PepsiCo, Inc. (PEP) – $54.09
- Digital Realty Trust, Inc. (DLR) – $55.25
- BHP Billiton PLC (BBL) – $142.60
Total dividends received during the month of September: $1,029.13.
I finally eclipsed the four-figure mark in a single month. I just can’t tell you how exciting it is to be able to say that I did that. And, you know, it took a while… but it really didn’t.
From starting in mid-2010 with no dividend income, I hit four figures in a single month a little more than five years later.
Five years is a long time, no doubt about it. It’s probably something like 6% of my entire lifetime. So it’s not trivial.
But at the same time, it’s also gone. The five years vanished like that. Just imagine if I had never taken on this journey. Imagine if the Jason of 2010 decided to just live like everyone else – keep his head low and plow on at work, never having the audacity to believe in a dream as big as financial independence in a relatively short period of time.
I mean, who was I to believe?
I was making a little more than $40,000 per year at the time. I didn’t know a thing about stocks or dividends. Nobody in my family ever once mentioned there was any other way other than the rat race. Hell, no one in my entire life ever dropped even a single hint that there was another path where there was light at the end.
Yet I believed there had to be another way. Life is too beautiful to spend it miserable, rotting under fluorescent lights every day, working at something I’m unhappy with because I lack passion, I’m not my own boss, I work too much, and I have no freedom.
Here I am now. 2015 is drawing to a close and I finally cracked four figures in a month. It’s a dream slowly coming true in real-time. And I’m blessed to be able to share it with you guys as I go.
But had I never started in the first place, that five years still would have gone by. It’d still be 2015. And I’d still be worth less than a baby. Time waits for no one. So make sure you’re always thinking of the you in five, ten, or 20 years. Because that version of you will eventually arrive. And you want to make sure that version is a lot better than the version of you that currently exists.
Looking at the numbers, I’m pretty happy with how things are shaping up. The diversification is really solid, although I’ve got a lot of companies in the oil & gas space sending me some pretty big checks. That overexposure is one major reason I’ve been a little timid when it comes to being aggressive in the Energy sector over the last year. However, I did jump in pretty vigorously last month, picking up some really solid values in names like BP and Shell, along with some of the major midstream pipeline plays. But I continue to build this portfolio out and spread those checks around as much as I can. I don’t want to become too reliant on any one company or industry, which could put my financial independence in danger if there’s an adverse change to the dividend policy due to unfavorable changes in business dynamics.
The dividend income for this month was 38.1% more than the dividend income my Freedom Fund generated in September 2014. I’m honestly surprised at the year-over-year growth there considering the base I’m working with, but I’ll take it.
I was able to cover 43.5% of my personal expenses this month via passive dividend income alone, which, while really solid, is lower than I anticipated due to some higher spending in September. I spent about $700 more than I planned on due to a coalescence of events. A great friend of mine got married, and I sent a good-sized gift for that. I also booked a weekend getaway for me and Claudia for our six-year anniversary. And then my iPhone 3G from 2008 finally broke on me, so I purchased a refurbished iPhone 4S. Still, covering almost half of my expenses via passive income even during a really expensive month (for me) is a great spot to be in at this point in time.
I’m currently focusing a bit more on yield right now so as to make a strong run at financial independence over the next year or so, which should allow me to progress a bit faster than I planned on. I’m currently slightly ahead of pace in terms of my long-term goal to become financially independent by 40, but I’m hoping to put myself even further ahead of pace over the next year or two. We’ll see how it goes, but I could be looking at completing things even earlier than I anticipated. As always, though, I continue to focus on high-quality dividend growth stocks with lengthy dividend growth records, solid fundamentals, and bright futures. I won’t mortgage away my future for the present. But if I can accelerate, I will.
One of my goals this year is to receive $7,200 in dividend income. That was a pretty intense goal to set considering where I finished last year, but I figured I’d just put it out there and see if I could stretch for it. Well, I’ve stretched as far as I can, and I can now say I’ve earned $5,373.77 in dividend income this year. That means I’ve completed 74.6% of that goal with 75% of the year behind us. So I’m on pace with what should be a fantastic fourth quarter still yet to come. Can’t wait to see how 2015 finishes. I’m doing all I can to finish strong and set things up for a great 2016. Stick around and let’s see what’s possible!
I’ll update my Dividend Income page to reflect September’s dividends.
Full Disclosure: Long all stocks except BBL.
What was September like for you? Have a great month for dividend income? Continue to break records? On pace for your goals?
Thanks for reading.