Tuesday, June 30, 2020

Expected Dividend Increases for July 2020

As I'm writing this post, June is a day away from ending, which means the year will soon be half over. The speed with which time is passing never ceases to amaze me!

And for the sake of this post, I'll be recapping key dividend announcements during the month of June and looking ahead to the sole dividend increase that I'm expecting during July.


Actual June Dividend Announcements

Dividend Increase #1: Realty Income (O)

As I expected in my previous post in this series, Realty Income (O) came through once again when it announced a 0.2% increase in its monthly dividend, boosting its dividend from $0.2330/share to $0.2335 share.

In a difficult operating environment such as the one we currently find ourselves in, it's reassuring to know that I own plenty of high-quality dividend paying stocks, such as O.

Across the 7 shares of O that I own, my annual forward dividend income was boosted by $0.042 as a result of O's dividend announcement.

Dividend Increase #2: W.P. Carey (WPC)

Just as O came through with a dividend increase as I expected, W.P. Carey (WPC) announced a 0.2% increase in its quarterly dividend, upping its dividend from $1.040/share to $1.042/share.

Across the 5 shares of WPC in my portfolio, my annual forward dividend income increased by $0.040 as a result of WPC's dividend announcement.

Dividend Increase #3: UnitedHealth Group (UNH)

As a result of not owning UnitedHealth Group (UNH) when it announced its dividend increase last June, I forgot to include my expectation for UNH's dividend increase in the previous post of the series.

Boy, was that quite the omission on my part, as UNH announced a 15.7% increase in its quarterly dividend, taking it from $1.08/share to $1.25/share.

UNH once again delivered a strong dividend increase, which is always appreciated, especially in this environment!

Across my single share of UNH, my annual forward dividend income was boosted by $0.68.

Dividend Cut: Simon Property Group (SPG)

Simon Property Group (SPG) announced a while back that it would be announcing its dividend later than usual toward the end of this month.

It was just today that SPG announced a 38.1% cut to its quarterly dividend, decreasing it from $2.10/share to $1.30/share.

While it is disappointing to see SPG announce a dividend cut considering it is one of my 10 largest positions in terms of dividend income, I don't blame SPG for temporarily cutting its dividend just to err on the side of caution. I fully expect that within the next year, SPG's dividend will be restored to its previous level.

Across my 6 shares of SPG, my annual forward dividend income decreased by $19.20.

Expected Dividend Announcements for July

Dividend Increase: JM Smucker (SJM)

Given the uncertain operating environment, I am expecting JM Smucker (SJM) to announce a smaller dividend increase than usual, which I believe will be a 2.3% increase in its quarterly dividend, from $0.88/share to $0.90/share.

If this occurs, my annual forward dividend income would be boosted by $0.16 across my 2 shares of SJM.

Concluding Thoughts:

Even though my dividend income stemming from dividend announcements declined by $18.438 during the month of June and my dividend income has now fallen by roughly 6% after the SPG cut and previous cuts/SKT's dividend suspension, I am confident that 2021 will usher in a return to growth and dividends will then quickly be restored to previous levels.

Discussion:

Did your portfolio experience any dividend cuts during June?

Are you expecting any dividend cuts down the road?

As always, thanks for reading and I welcome your comments in the comment section below.




Tuesday, June 23, 2020

The Remarkable Benefits of Remote Work

As I'm writing this blog post, today is the 90th day or 3 month mark of when I began working remotely.

I recently returned to work in a traditional capacity 3 days a week and have been remotely working the other 2 days a week.

Over the past 3 months, I have benefited significantly in a number of ways as a result of being able to work remotely, which I'll delve into below.

Person Using Macbook Pro

Image Source: Pexels

Extra Sleep

For someone that really needs their 7-8 hours of sleep each night to most efficiently function during the day, I am so grateful for this opportunity to work remotely because I save a significant amount of time in the morning not having to get ready for work in the traditional sense.

Before I go into work each morning, I take care of personal care tasks, including brushing my teeth, showering, and combing my hair.

While I still brush my teeth two to three times a day, I am able to defer showering and combing my hair into the evening when I have more time, and don't have to rush as much with getting ready in the morning when I am working remotely.

As I'm sure most of us can attest, it can become tiring to also commute to traditional work, which leads me into my next point.

Extra Time And Improved Health

While I'm lucky in the sense that my 24 minute round trip commute to work is far less than the national average 26 minute one-way commute time, a 24 minute round trip commute 5 days a week is still 2 hours a week or about 1.3% of the total hours in a week (and much more of my waking hours when factoring in sleep).

Over the past 3 months (factoring in the 9 days that I have went to work over the past 3 months), I have saved about 1,320 minutes or nearly an entire day that I would have otherwise spent commuting.

This is time that I have spent engaging in more fulfilling activities, such as writing blog posts, exercising, spending time with family, and researching investment opportunities.

The other major benefit from a health standpoint, is that I don't have to deal with overly cautious drivers in front of me going 10 mph under the speed limit in ideal driving conditions while I'm on my way to work or maniacs behind me wanting to go 10 mph or more over the speed limit while I'm on my way home from work.

In support of this observation, a study of 33,000 UK drivers found a link between commute times and mental health. The longer and more frequent commutes that workers make to arrive at their jobs results in an increased risk of depression and work-related stress.

Extra Money

And aside from the extra sleep, time, and improved health, I have also saved about $66 over the past 3 months in fuel expenses (825 miles/25 mpg, assuming $2/gallon gas).

While that isn't necessarily a lot, my typical monthly fuel expenses are about $30/month at $2/gallon gasoline, so my fuel expenses have been cut by roughly 70% over the past 3 months.

Concluding Thoughts:

It has been a blessing to have the privilege of working from home more often than not over the past 3 months. The benefits of extra sleep, improved health, and extra money leave me hoping that I am able to at least work remotely 1 day a week indefinitely.

Discussion:

Have you had the privilege of working remotely over the past 3 months?

If so, have you observed the benefits that I discussed above or any other benefits? If not, would you prefer to work remotely?

Tuesday, June 16, 2020

Life Isn't About Money As Much As Freedom And Fulfillment

From time to time, I reminisce about the past as most of us do.

Recently, I recalled being a kid in middle school and stumbling upon the concepts of dividend investing, as well as building long-term, generational wealth through Joshua Kennon on About.com.

When I first came upon the concepts, I was misguided as you would expect a middle school kid to be in that I wanted to build obscene wealth during my lifetime that would put me among the Forbes billionaires just for the sake of being obscenely rich and giving into consumerism.

I would continue to possess this mindset of striving for obscene wealth for no serious reason (though, perhaps my reason in the back of my mind was the freedom aspect that I'll delve into) until I began high school.

Around the time of high school about a year later, I began reading Joshua Kennon's personal blog, Jason Fieber's Dividend Mantra blog (and as of a few years ago, his MrFreeat33 blog), and Tim McAleenan Jr.'s The Conservative Income Investor blog.

It was really upon reading those blogs, and especially Jason's blogs that I began to think about more than just the scoreboard aspect of money and more deeply about the aspect of money that is the most powerful, which is the fact that one of the things that money is capable of buying is freedom over one's time to choose what they'd like to pursue.

I'll Take Freedom And Frugality Any Day Over Excessive, Meaningless Wealth

As part of my foolish thinking in my early teen years, I envisioned that I would own my own exclusive and luxurious private island somewhere in the Caribbean in my later years. How I thought at the time that purchase would be able to allow me to live a fulfilling and happy life is beyond me to this very day.

I suppose that would be a reflection of the consumerist culture we live in and the fact that by the time an American teenager reaches age 18, they have seen approximately 350,000 advertisements, according to the University of Washington, which all seem to promise happiness and fulfillment designed to encourage consumerism.

As I read about dividend growth investing and the ability for average wage earners to achieve financial independence at a relatively early age by spending purposefully and investing aggressively in high-quality dividend stocks, a light bulb went off in my head that I could be one of those people to achieve financial independence and pursue my passions rather than having to work a job just for the sake of paying bills.

Even though I don't have all of the details of what my post-FI life would look like at this time, I know that I wouldn't mind having more time to exercise, watch sports, blog more, write more for Seeking Alpha, and spend time with family. I often find that weekends go by too fast and I am unable to do all that I would like to do.

I came to the realization that rather than simply working at a job I may not be fulfilled at for the sake of acquiring wealth beyond what I would even be able to reasonably spend as a naturally frugal person, I would be happier by achieving financial independence to enable myself to pursue the interests and activities that enhance my quality of life.

While obscene amounts of wealth aren't necessarily a bad thing (and one can actually create even more significant wealth by being FI and leveraging their enthusiasm for their passion to produce valuable goods or services for society), I came to the realization years ago that beyond the basics of food/an abundant source of clean water, housing in a reasonably safe area, quality healthcare, and taxes being covered, nothing else is needed to fulfill the two rungs of Maslow's Hierarchy of Needs, which cover physiological needs and safety needs.

Simply by having the financial means to passively provide the basics in life and a bit of money for discretionary spending, you are living better than the vast majority of the world, which lives in fear of possibly losing their job and being unable to provide for themselves and their family's basic needs.

It is from that point, one is able to focus solely on building stronger relationships and connections with others to meet their psychological needs and to focus on their passions to give themselves a sense of accomplishment and eventually, self-actualization.

When someone is getting ready for a job, working a job, and decompressing after a job, they lose much of their time that they could otherwise be focusing on working toward self-actualization, which is necessary to live a happy and productive life.

Concluding Thoughts:

Money is a tool and just as it can be used for bad purposes that prevent one from living a fulfilling and happy life (one purpose of which, is unchecked consumerism), money can be used as a tool to improve one's friendships and connections, and to pursue passions in a manner that would otherwise be difficult when working full-time at a job that may be unfulfilling.

It took me until high school to come to this realization, but I'm glad I did because I believe it will ultimately help me to live a more purposeful and fulfilling life.

Discussion:

Did you have any excessive consumerist thoughts that were guided by a society of consumerism as a teen? If so, what were they?

Since you're on this blog, I'm assuming that you have probably since changed your beliefs on consumerism and have adapted a more mindful approach to spending.

If that's the case, what made you change your beliefs and adopt frugality as a way of life?

As always, I appreciate your readership and look forward to reading the comments that you are free to leave in the comment section below.

Wednesday, June 10, 2020

May 2020 Dividend Stock Purchases

As I'm writing this blog post on June 6th, the NBA is set to resume its season at the end of July and the NBA Finals are expected to conclude sometime in mid-October.

After over 12 weeks of no NBA basketball and the Bucks' potential championship run being on hold, I am excited for the end of July to see what this team can accomplish in this season of unprecedented challenges.

With that exciting announcement out of the way, I'll be discussing the investment activity within my investment portfolio for last month.


The only actual activity within my portfolio that involved the purchase of stocks or mutual funds came within my retirement account, where I invested $391.96 between my contributions and the contributions of my employer. 

Net of sales charges, my employer and I contributed $374.33 to my portfolio and my total share count of Capital Income Builder (CAIBX) increased by 6.761 shares from 104.572 shares to end April to 111.333 shares to end May.

As a result of the above capital contributions, my annual forward dividend income was boosted by $14.47, which equates to a net yield of 3.87%.

The only other activity within my investment portfolio was my $2,475.19 reduction in margin debt from $4,964.66 to $2,489.47.

This halving of my Robinhood margin resulted in a $123.76 increase in my annual forward dividends net of margin interest.

Factoring in that I need to pay off a bit of credit card debt that will start bearing interest this September and my usual living expenses, I am well on track to eliminate all of my margin debt in July aside from the interest free $1,000 portion that will essentially cover the cost of Robinhood Gold and allow me to access Morningstar's reports for free.

Concluding Thoughts:

As a result of a 3 paycheck month and a $1,200 stimulus check, May was a great month in terms of deleveraging my Robinhood portfolio and building my retirement portfolio.

Including the suspension of Tanger Factory Outlet Centers' (SKT) dividend last month, my annual forward dividend income was boosted by $122.50 from just under $1,100 to $1,220. 

I deployed a total of $2,849.52 in May at an average yield of 4.85%.

Discussion:

How was your month in terms of capital deployment?

Did you endure any dividend cuts or suspensions during the month of May as I did with SKT?

As always, thanks for reading and I look forward to the comments that you leave in the comment section below!

Tuesday, June 2, 2020

May 2020 Dividend Income

As I'm writing this blog post here on May 31st, it has been an astounding 83 days since the Milwaukee Bucks last played and the MLB season has yet to start about 2 months after what was scheduled to be Opening Day.

The past few months have definitely been an adjustment in terms of my time commitment as the Bucks used to consume 7-8 hours a week of my time between games and occasional perusing of Bucks news/team and player grades for each game.

Fortunately, I have this blog, dividend investing, mobile gaming, spending time with family, and playing basketball in the driveway to fall back on or I would have completely lost my mind by now.

With that being said, I'll be examining my dividend income for May 2020.






Analysis:

During the month of May, I collected $86.62 in net dividends against the $86.62 in dividends collected in February 2020, and generated a 96.7% YOY growth rate compared to the $44.04 in dividends received in May 2019.

Delving into things a bit further, I received $74.84 in dividends in my Robinhood portfolio from 16 companies net of the $5.00 in Robinhood Gold fees and $10.99 in Robinhood Gold for my use of margin. I also collected $11.46 in dividends from 3 companies within my Webull portfolio. Lastly, I received $0.32 in dividends from 15 companies in my M1 Finance portfolio.

The same amount of dividends collected from February 2020 to May 2020 was as a result of the following activity within my taxable accounts:

I benefited from $1.44 in additional dividends from Williams Sonoma (WSM) as a result of my purchase of another 3 shares in March.

I also received an extra $3.36 in distributions from Energy Transfer (ET) because of my decision to purchase 10 units of ET during my March buying spree and 1 unit of ET in February.

I received an extra $1.76 in dividends from British American Tobacco (BTI) as a result of my purchase of 3 shares in March, net of ADR fees.

I also benefited from my purchase of 2 units of Magellan Midstream Partners (MMP), which boosted my dividend income by $2.06 during May.

My purchase of an additional 3 shares of Realty Income (O) in March and O's dividend increase resulted in an additional $0.70 in dividend income in May.

Another purchase that boosted my dividend income was my purchase of 1 share of AbbVie (ABBV), which added $1.18 to my May dividend income.

My purchase of 16 shares of Main Street Capital (MAIN) in March resulted in an extra $3.28 in dividend income collected in May.

I also collected an additional $0.02 in dividend income as a result of Tanger Factory Outlet Centers' dividend increase, though the company later suspended its dividend, which will likely impact my August income report.

EQM Midstream Partners' (EQM) recently announced distribution cut affected my distributions for the first time in this report, which resulted in a $3.09 reduction in May distribution income.

I also added 12 shares of ONEOK (OKE) in March, which led to an additional $11.22 in dividend income during May.

My purchase of an additional 5 units of Enterprise Products Partners (EPD) resulted in an additional $2.23 in distribution income in May.

My purchase of another share of General Dynamics (GD) in March and GD's recent dividend increase boosted my dividend income by $1.26 in May.

The March purchase of an additional 2 shares of Lowe's (LOW) added $1.10 to my May dividend income.

An additional 3 shares of AT&T (T) that I also purchased in March added $1.56 to my May dividend income.

Due to the timing of The GEO Group's dividend payment, I collected $5.76 less in dividends during the month of May.

Due to the fact that Simon Property Group is deferring its dividend announcement until June, my dividend income was $6.30 less in May than it was in February.

My Robinhood Gold subscription deducted $5.00 from my net dividend income and the interest on my margin deducted $10.99 from my net dividend income.

The final activity came within my M1 Finance portfolio, again, when EQM Midstream Partners paid me $0.03 less in distributions compared to February.

Concluding Thoughts:

Overall, I'm pleased with a steady mid-quarter month in May compared to February as it was a few months ago that we began to see the impact of dividend cuts and suspensions within my portfolio and many other dividend investor's portfolios.

While I do believe that there will be a couple more cuts within my portfolio over the next two months, I am encouraged by the fact that I have paid down nearly $2,500 (half of my total margin heading into May) and over 60% of the margin that I intend to pay off as I plan on using the first $1,000 in interest free margin to essentially cover the cost of Robinhood Gold with dividends on that $1,000 to access Morningstar's reports and the other benefits of Robinhood Gold.

The significant deleveraging that I was able to execute during May will more than offset the impact of any of the dividend cuts that I am expecting in the next two months and since I anticipate that I will begin investing to the tune of $1,500-$2,000/month once again beginning in July, I am forecasting a slight uptick in my August dividend income, approaching $100 net of Robinhood Gold fees and interest.

Discussion:

How was your May in terms of dividends collected?

Did you benefit from any first time dividend payments from new holdings?

What are you forecasting for your August dividend income?

As always, I thank you for your readership and welcome comments in the comment section below.





Tuesday, May 26, 2020

Expected Dividend Announcements for June 2020

With each passing month, I become more and more convinced that life passes us by in a hurry. It seems as though it was just yesterday I was writing my expected dividend increases for May post, even though it was a month ago.

With that said, I'll recap the dividend announcement activity over the past month before delving into the dividend announcements that I'm expecting for June.


Pending Dividend Increase: Lowe's (LOW)

Given that Lowe's will be hosting its Annual Meeting of Shareholders this Friday, I expect that we will be receiving a 5.5% increase in LOW's quarterly dividend from $0.55/share to $0.58/share

Across my 4 shares of LOW, this would result in a $0.48 boost in my annual forward dividends.

Expected Dividend Announcements for June

Expected Dividend Increase #1: Realty Income (O)

Given that Realty Income has been arguably the most consistent performer in my portfolio in terms of dividend increases, I wouldn't be surprised to see O announce a 0.2% increase in the monthly dividend from $0.2330/share to $0.2335/share.

Across my 7 shares of O, this would increase my annual forward dividends by $0.042.

Expected Dividend Increase #2: WP Carey (WPC)

WP Carey is another consistent dividend payer within my portfolio that is likely to increase its quarterly dividend by 0.2% from $1.040/share to $1.042/share. 

Across the 5 shares of WPC, this announcement would boost my annual forward dividends by $0.040.

Concluding Thoughts:

While I am awaiting an announcement from Lowe's this Friday, this month has only resulted in a dividend suspension from Tanger Factory Outlet Centers (SKT) among my 51 whole share holdings.

Although I do believe there will be another cut or two within my portfolio in the months ahead, I am certainly encouraged that my dividend income has only been reduced by 4% during an unprecedented response to COVID-19.

In my humble opinion, the overall performance of my dividend portfolio and its ability to continue to pay dividends has only reinforced my confidence in the DGI strategy.

Discussion:

Have you benefited from any dividend increases this month?

Have you experienced any dividend cuts or suspensions?

As always, I appreciate your readership and welcome comments in the comment section below.

Tuesday, May 19, 2020

The Impact Of Dividend Announcements On My Portfolio (So Far)

As the response to contain COVID-19 as best as possible continues with trying to balance the economic and mental health aspect that the virus is having on just about every American, I thought it would be helpful to examine the impact that a generational economic downturn has had on my portfolio, especially considering this will be the first recession that my 51 whole share stock portfolio has endured since I began investing in September 2017.

Analysis

Delving right into the impact on dividend announcements, and particularly on dividend cuts/suspensions, my portfolio has held relatively strong to date, with the following 2 dividend/distribution cuts and a dividend suspension.

Dividend Cut: Royal Dutch Shell (RDS.B)

In a sector that is as dependent on the global economy as that of the energy sector, it was only somewhat surprising that the supermajor Shell opted to cut its dividend for the first time since World War II.

After all, the Energy Information Administration or EIA estimates that global petroleum and liquid fuels consumption averaged 94.1 million barrels per day in the first quarter of 2020, which was a decline of 5.8 million bpd from the same period in 2019.

As I discussed in my recent Seeking Alpha article on Energy Transfer, oil faces two key challenges in the months ahead, which is the notable decline in energy demand coupled with the excess supply of oil.

EIA predicts that these two factors will weigh heavily on the price of WTI crude this year, with WTI averaging $30. Fortunately, a recovery is expected next year, with prices expected to average $43 as energy demand recovers and excess supply of oil is depleted.

Keeping all of this in mind and the fact that Shell seeks to minimize the burden of the pandemic on its balance sheet, it makes sense that Shell made the decision to slash its quarterly dividend by 66.0%, from $0.94/share ($0.47/share, but each American Depository Shares counts as 2 shares) to $0.32/share.

As a result of Shell's decision to cut its dividend, my annual forward dividend income declined by $22.32 across my 9 shares.

Distribution Cut: EQM Midstream Partners (EQM)

Unlike Shell and the dividend announcement that was slightly surprising, it wasn't at all surprising that EQM Midstream Partners announced a 66.6% cut in its quarterly distribution, from $1.16/unit to $0.3875/unit.

It was just this past February that EQM announced that it would be acquired by Equitrans Midstream (ETRN) and that a significant distribution cut would be in the works.

Given that EQM is doing its best to deleverage and to increase the coverage of its distribution as it attempts to get its Mountain Valley Pipeline project into service by the end of this year, it makes sense that the company would be cutting its distribution at this point to improve its sustainability as a company going forward and if/when MVP is complete, EQM will be flush with cash to deleverage and raise its distribution rapidly.

Across my 4 units of EQM, my annual forward distributions dropped by $12.36.

Dividend Suspension: Tanger Factory Outlet Centers (SKT)

The dividend suspension in my portfolio came last week, when Tanger Factor Outlet Centers announced that it would be suspending its quarterly dividend of $0.3575/share for the foreseeable future in order to preserve liquidity during the COVID-19 pandemic.

SKT also added that the company sees sufficient liquidity for 2 years, which is an encouraging sign as the tenants of SKT and their customers gradually shift back to the experience-centric mindset, which brought most of them to malls in the first place.

My annual forward dividends were reduced by $15.73 across my 11 shares of SKT as a result of the company's dividend suspension.

Concluding Thoughts:

While it's still too early to tell whether or not the worst is behind us, the $50.41 reduction in my annual forward dividends/distributions thus far (although really $38.05 when excluding EQM as that distribution cut was going to happen regardless of what COVID-19 eventually did to the global economy) represents only 4% of my annual forward dividends of $1,201.

Given the magnitude of the COVID-19 pandemic and the unprecedented shutdown of significant portions of the global economy, I am relatively impressed with how my dividend portfolio has held up to date, though I wouldn't be surprised to see another cut or two in the weeks/months ahead.

Discussion:

How has your portfolio held up in the unprecedented global economic response to COVID-19?

Has it been better than expected given the circumstances or worse than you expected?

Has this event challenged or reinforced your belief that a dividend growth investment strategy is viable regardless of economic conditions?

As always, I welcome and appreciate any thoughts that you leave in the comment section below. Thanks for reading!


Tuesday, May 12, 2020

April 2020 Dividend Income

As I'm writing this post, it's difficult to comprehend that April is already behind us and the year is already more than a third in the books with less than 8 months remaining.

Given that I discussed my dividend stock purchases for April last week and the expected dividend stock announcements for May the week prior to that, I'll be reporting my dividend income for the month of April 2020.







Analysis:

Overall, I collected $49.52 in dividends net of the $23.41 in Robinhood Gold fees and interest on margin during the month of April.

This represents an 8.1% quarterly growth rate compared to the $45.81 in dividends that I collected in January 2020 and a YOY growth rate of 56.4% compared to the $31.67 in dividends that I received in April 2019.

Delving into my dividend income further, I received $59.57 in dividends from the 15 companies in my Robinhood portfolio that paid dividends during the month of April, $13.11 in dividends from the 5 companies in my Webull portfolio that paid dividends during April, and $0.25 from the 11 companies in my M1 Finance portfolio that paid dividends in April.

When weighed against the $23.41 in Robinhood Gold membership fees/margin interest, the $3.71 in additional dividend income collected during April compared to January of this year was as a result of the following activity within the portfolio:

I received an additional $3.36 in dividends from Altria Group (MO) due to my purchase of an additional 4 shares in March.

Due to the timing of The GEO Group's (GEO) dividend payment and the purchase of an additional 4 shares in March, I also received an additional $7.68 in dividends from the prison REIT.

Another $0.72 in dividends received were from my 3 share addition to my stake in Realty Income (O) also in March and the most recent dividend increase.

An additional $2.09 in dividends were received from WP Carey (WPC) as a result of my purchase of an additional 2 shares in March and the recent dividend increase.

Another March purchase that provided me with a first time dividend during the month of April was that of my 16 share purchase of STORE Capital (STOR), which boosted dividend income by $5.60.

Yet another March purchase was Main Street Capital (MAIN), which provided me with my first dividend from the company of $2.26 for the month of April.

I received an additional $2.38 in dividend income from Ventas (VTR) as a result of my purchase of 3 shares of the stock in March.

GlaxoSmithKline (GSK) paid out an additional $0.47 in dividends compared to January as a result of its historically higher April payout.

I purchased an additional share of Philip Morris International (PM) in March, which boosted my dividend income by $1.17 during the month of April.

I purchased 4 shares of Iron Mountain (IRM) in my Webull account in January, which increased my dividends by $2.47 during the month of April.

Eastman Chemical Company (EMN) paid an additional $0.66 in dividends during the month of April as a result of my purchase of a share in March.

Albemarle's (ALB) recent dividend increase added $0.09 to my dividend income for the month of April.

Yet another dividend increase that boosted my dividend income during the month of April was PPL Corp's (PPL), which added $0.02 to my dividend income.

The final dividend increase came via Genuine Parts Company (GPC), which padded my dividend income by $0.08 for April.

The dividend income across my Robinhood and M1 Finance portfolios was $1.93 ($1.91 in Robinhood and $0.02 in M1 Finance) lower as a result of the timing of PepsiCo's (PEP) dividend.

Concluding Thoughts:

April was a record month for dividend income for an opening month of a quarter and I expect that my July income report will eclipse the $55 mark in net dividend income as I continue to use my dividends and fresh capital to pay down my margin to the first $1,000 in interest free margin within my Robinhood account.

Discussion:

How was your April in terms of dividend income?

Did you receive any dividends from new stocks in your portfolio for the first time as I did with STOR and MAIN?

As always, I appreciate your readership and look forward to reading any comments that you are encouraged to leave in the comment section below.









Tuesday, May 5, 2020

April 2020 Dividend Stock Purchases

As I indicated in my previous post of this series, the bulk of my capital allocation into early summer will be focused on paying down my Robinhood margin from the $4,960 that it was entering May to $1,000 of interest free margin.

As a result of this commitment to deleverage, my investing activity was relatively limited for the month of April as I'll discuss below.



Starting with my retirement account, my employer and I contributed $252.58 to my Capital Income Builder (CAIBX) holding.

Net of sales charges, I and my employer invested a total of $241.23.

Given that these transactions increased my total share count of CAIBX from 100.088 shares entering the month of April to 104.572 shares heading into May, I added 4.484 shares of CAIBX during the month.

Assuming annualized dividends per share of $2.14 ($0.50/share quarterly dividends plus an annual special dividend of $0.14), this boosted my annual forward dividend income by $9.60, which is a net yield of 3.98%.

The only actual stock purchase came in my Webull brokerage account, which was when I purchased a share of STORE Capital (STOR) at a cost of $16.78.

When considering the $1.40 in annual forward dividends added by the purchase, this equates to an 8.34% yield on the capital deployed.

Aside from the purchasing activity this month, the notable development was that I paid down my Robinhood margin balance from $5,780 to just below $5,000 as a result of an $800 deposit.

Concluding Thoughts:

Overall, I invested $258.01 in dividend stock/mutual fund purchases during the month of April, which collectively added $11.00 in annual forward dividend income.

Unfortunately, I encountered the distribution cut from EQM Midstream Partners (EQM), which was included in my previous post in my expected dividend increases series.

On top of that, I will be including the recently announced 66% dividend cut from Royal Dutch Shell (RDS.B) in my next dividend increases/announcement post as they cut their dividend for the first time since World War II on the last day of April after I updated my previous post a couple of times preceding the cut.

As a result of these dividend cuts sustained during the month of April and all other activity, my dividends edged slightly higher to just under $1,100 heading into May.

Given that the month of May will include 3 paychecks rather than 2, I expect that I'll be able to pay off nearly $2,000 in margin during the month, which will get me significantly closer to reaching my target of $1,000 of margin.

From that point, I will be allocating 5-10% of my portfolio to cash in order to take advantage of future corrections and bear markets to prevent myself from succumbing to the risk of taking out too much margin and being a forced seller.

Discussion:

How was your month in terms of purchasing volume?

Did you add any new names to your portfolio or were you building upon the existing dividend stocks in your portfolio?

As always, I appreciate your readership and look forward to any comments that you are welcome to leave in the comment section below.

Tuesday, April 28, 2020

Expected Dividend Increases for May 2020

As indicated in the title above, I'll be reviewing the dividend announcements in my portfolio for the month of April and previewing the dividend announcements that I am expecting for May.


April Dividend Increases

Increase #1: Johnson & Johnson (JNJ)

As a testament to Johnson & Johnson's dependability as a company, JNJ announced a dividend increase that slightly exceeded what I was expecting as outlined in my previous post in this series.

JNJ announced a 6.3% increase in its quarterly dividend, taking it from $0.95/share to $1.01/share.
As a result of this dividend announcement, my annual forward dividend income increased by $0.48 across my 2 shares.

Increase #2: Southern Company (SO)

The other dividend increase that I have benefited from as of April 27 came from Southern Company.
SO raised its quarterly dividend by 3.2% from $0.62/share to $0.64/share.

Across the 5 shares that I own, my annual forward dividend income was boosted by $0.40.

Increase #3: International Business Machines (IBM)

International Business Machines announced a 0.6% increase in its quarterly dividend from $1.62/share to $1.63/share.

While this is bellow my expectation, I understand that IBM is being conservative with its dividend at this time, with the idea they can reward shareholders with a greater raise later down the road.

Across my 4 shares of IBM, my annual forward dividend income was boosted by $0.16 due to IBM's announcement.

Freeze #1: ONEOK (OKE)

Due to the supply and demand shock in energy at this time, it wasn't a surprise to learn that ONEOK froze its quarterly dividend at $0.935/share.

As the business environment stabilizes in the next couple quarters, I anticipate OKE to resume dividend increases.

Freeze #2: Magellan Midstream Partners (MMP)

Similar to OKE, Magellan Midstream Partners announced a freeze in its quarterly distribution at $1.0275/unit.

Again, I expect MMP to resume distribution increases likely within the next 6 months.

Freeze #3: Exxon Mobil (XOM)
Exxon Mobil announced that it would be maintaining its quarterly dividend at $0.87/share.

Given the downturn throughout the economy, and especially in energy, XOM's announce of a dividend freeze wasn't too surprising.

Like other energy companies, I expect that XOM will announce a dividend increase later in the year as economic activity picks back up.

Dividend Cut: EQM Midstream Partners (EQM)

Although EQM Midstream Partners announced in February that it would be cutting its distribution in the future, EQM officially announced that it would cut its distribution on the day that I am writing this post.

The quarterly distribution was slashed 66.6% from $1.16/unit to $0.3875/unit, which will free up a tremendous amount of capital for EQM and make it much more sustainable for the long-term as it lowers its DCF payout ratio considerably.

Across my 4 units of EQM, this cut resulted in a $12.36 decrease in annual forward distributions.

Expected Dividend Increases in May

Expected Dividend Increase #1: Lowe's (LOW)

Under normal circumstances, I would expect Lowe's to announce a high single-digit to low-double digit dividend increase in LOW's dividend.

Unfortunately, COVID-19 complicates matters and makes it nearly impossible to accurately predict what LOW will announce as its next dividend.

Should LOW announce a dividend increase, I suspect that increase will be in the mid-single digits.
I'm predicting a 5.5% increase in LOW's quarterly dividend from $0.55/share to $0.58/share.

In a less likely event, I wouldn't be too surprised to find that LOW announced a temporary dividend freeze until the full economic impact of COVID-19 is known.

Expected Dividend Increase #2: Leggett & Platt (LEG)

Similar to LOW, I'm not sure what Leggett & Platt will announce as its next quarterly dividend due to these extraordinary times.

If LEG does announce a dividend increase in May, I expect that the company will announce a 2.5% increase in its quarterly dividend from $0.40/share to $0.41/share.

Once the economic impact of COVID-19 begins to ease, I believe that LEG will announce another smaller dividend increase to likely $0.42/share later in the year.

Expected Dividend Increase #3: Main Street Capital (MAIN)

In the case of Main Street Capital, I am expecting that MAIN announces a 2.4% increase in its monthly dividend from $0.205/share to $0.210/share, though this will be partially offset by a $0.01 reduction in MAIN's semiannual special dividend from $0.24/share to $0.23/share.

Across my 16 shares of MAIN, this announcement would increase my annual forward dividends by $0.64.

Concluding Thoughts:

Outside of the distribution cut from EQM, this month was fairly decent in terms of dividend increases.

As a result of EQM's significant distribution cut, my annual forward dividend income declined $11.32. Besides the effective distribution cut when Energy Transfer Partners merged with Energy Transfer Equity to form Energy Transfer (ET) in 2018, this is the first month that my dividend income decreased from dividend announcements.

As unfortunate as this pandemic is in terms of the loss of life and financial uncertainty for tens of millions of Americans, one of the rare positives to come out of this in my opinion, is that I'm able to test the dividend growth investing strategy in real time through a very difficult business environment for the first time in my investing career.

Should my dividend income come out of this pandemic relatively unscathed as I suspect it will, this would go another step further in affirming my belief in DGI as a sustainable strategy to achieve financial independence.

Discussion:

How was your April in terms of dividend increases?

Did you experience any dividend cuts?


Are you expecting any dividend increases from newer stocks in your portfolio as I am with MAIN?











Tuesday, April 21, 2020

March 2020 Dividend Stock Purchases

Delving directly into the intent of this post, I indicated my rationale for my decision to use Robinhood Gold and nearly $5,000 of margin beyond the first $1,000 of interest free margin in my previous blog post.

Today, I'll be detailing the purchases that I executed last month as a result of the margin used in my Robinhood account and my retirement account purchases.













Starting with the purchases in the retirement account, I deployed $292.36 in capital with the dividends received during the month included and $281.38 net of sales charges.

As a result of these contributions and dividends, I was able to increase my Capital Income Builder (CAIBX) holdings from 94.776 shares entering March to 100.088 shares entering into April.

The 5.312 shares of CAIBX that were added during the month of March boosted my annual forward dividends by $11.37.

Starting from the top of the screenshots, I added 12 shares of ONEOK (OKE) at an average cost per share of $37.06 and a total cost of $444.77.

Across the 12 shares that I purchased, I increased my annual forward dividends by $44.88 and deployed capital at a yield of 10.09%.

I also added 3 shares of Realty Income (O) at an average cost of $48.88 a share and a total cost of $146.63.

The $8.39 in annual forward dividends added as a result of my purchase of O equates to a yield of 5.72%.

While on the subject of triple net lease REITs, I also added 2 shares of WP Carey (WPC) to my portfolio at an average cost of $51.47 a share and a total cost of $102.93.

The $8.32 in annual forward dividends that were added as a result of my purchase of WPC works out to a yield of 8.08%.

Rounding out the triple net lease REITs, I opened a position in STORE Capital (STOR) by purchasing 16 shares at an average cost of $29.18 a share and a total cost of $466.93.

The initiation of this position resulted in an addition of $22.40 in annual forward dividends, which is a yield of 4.80%.

Moving to the BDC industry, I initiated a 16 share position in Main Street Capital (MAIN) at an average cost of $31.45 a share and a total cost of $503.15.

Including the special dividends, the MAIN position added $47.04 in annual forward dividend income, which works out to a 9.35% yield.

Moving to the semi-conductor industry, I added to my overall position in Broadcom (AVGO) (which was started in my Webull brokerage account) and initiated a position in the stock in my Robinhood portfolio.

The 2 shares of AVGO that I purchased last month were at an average cost of $236.99 a share and a total cost of $473.97.

When factoring in the $26.00 in annual forward dividends that were added to my portfolio, my investment in AVGO was at an average yield of 5.49%.

Transitioning back to REITs, but more specifically, prison REITs, I added 4 shares to my position in The GEO Group (GEO) at an average cost of $11.95 a share and a total cost of $47.80.

The $7.68 in annual forward dividends equates to an average yield of 16.07%.

I also added 6 shares of Prudential Financial (PRU) at an average cost of $59.86 a share and a total cost of $359.14.

When considering the $26.40 in annual forward dividends that were added as a result of my purchase of PRU shares, the capital that I deployed into PRU was at an average yield of 7.35%.

Moving back to REITs and more specifically to mall REITs, I added 3 shares to my position in Simon Property Group (SPG) at an average cost of $97.09 a share and total cost of $291.26.

The $25.20 in annual forward dividends that were added due to the purchase of SPG shares works out to an average yield of 8.65%.

Moving to tobacco, I added 2 shares of Philip Morris International (PM) at an average cost of $73.62 a share and a total cost of of $147.23.

When factoring in the $9.36 in annual forward dividends that were added as a result of my purchase of PM shares, the capital deployed into PM was at a yield of 6.36%.

I added 3 shares of Ventas (VTR) at an average cost of $24.71 a share and a total cost of $74.13, which works out to an average yield of 12.83% on the $9.51 of annual forward dividends generated as a result of my purchase.

What's more, I added a share of The Home Depot (HD) at a cost of $161.70, which is a yield of 3.71% on the $6.00 of annual forward dividends produced in the portfolio as a result of my purchase.

 On the tobacco front once again, I added 4 shares of Altria Group (MO) to my portfolio at an average cost of $38.98 a share and a total cost of $155.92.

The $13.44 in annual forward dividends added as a result of the MO purchases were at an average yield of 8.62%.

Concluding with tobacco industry purchases, I added 3 shares to my position of British American Tobacco (BTI) at an average cost of $30.55 and a total cost of $91.65.

When considering the $8.06 in annual forward dividends due to my purchase of BTI shares, my cost basis on this block of shares works out to a yield of 8.80%.

I also added 3 shares to my position in Leggett & Platt (LEG) at an average cost of $24.40 and a total cost of $73.20.

Against the $4.80 in annual forward dividends added from this purchase, I deployed capital at a yield of 6.56%.

Furthermore, I added 3 shares of Genuine Parts Company (GPC) at an average cost of $58.88 a share and a total cost of $117.76.

The $6.32 in annual forward dividends added from this purchase work out to a 5.37% yield.

Moving to the multi-conglomerate AT&T (T), I added 3 shares at an average cost of $28.93 a share and a total cost of $86.79.

When I factor in the $6.24 in annual forward dividends added as a result of this purchase, the capital invested in T was at an average yield of 7.19%.

Moving to the tech giant International Business Machines (IBM), I added a share to my position at a cost of $96.80.

Against the $6.48 in annual forward dividends added by the purchase of IBM, this works out to a yield of 6.69%.

Transitioning back to the home improvement industry, I also added 2 shares of Lowe's (LOW) at an average cost of $69.42 a share and a total cost of $138.84.

When I consider the $4.40 in annual forward dividends added by the purchase of LOW stock, this works out to a yield of 3.17%.

I also added 3 shares of Williams Sonoma (WSM) at an average cost of $36.30 a share and a total cost of $108.90, which equates to a yield of 5.29% against the $5.76 in annual forward dividends added.

Moving to the financial sector, I added 3 shares of Wells Fargo (WFC) to my portfolio at an average cost of $33.51 a share and a total cost of $100.52.

When I factor in the $6.12 in annual forward dividends added by my purchase of WFC shares, this works out to a yield of 6.09%.

Transitioning to logistics, I opened a 4 share position in United Parcel Service (UPS) at an average cost of $90.17 a share and a total cost of $360.66.

Against the $16.16 in annual forward dividends added by the purchase of UPS shares, this is a yield of 4.48%.

On the midstream front, I added 10 units to my position in Energy Transfer (ET) at an average cost of $8.40 a unit and a total cost of $84.00.

When I consider the $12.20 in annual forward distributions that I added as a result of my purchase, this works out to a yield of 14.52%.

Additionally, I added 5 units to my position in Enterprise Products Partners (EPD) at an average cost of $18.99 a unit and a total cost of $94.95.

The $8.90 in annual forward distributions added as a result of my EPD purchase equates to a yield of 9.37%.

Within the energy industry, I also added 5 shares of Royal Dutch Shell (RDS.B) at an average cost of $39.05 a share and a total cost of $195.24.

When I factor in the $18.80 in annual forward dividends added due to my purchase of RDS.B shares, my purchase works out to an average yield of 9.63%.

Staying on the subject of supermajors, I also added 7 shares of British Petroleum (BP) at an average cost of $28.22 a share and a total cost of $197.54.

Against the $17.50 in annual forward dividends added as a result of the purchase, my investment works out to an average yield of 8.86%.

Concluding with the supermajors, I added 5 shares of Exxon Mobil (XOM) at an average cost of $48.87 a share and a total cost of $234.34.

When I consider the $17.40 in annual forward dividends added due to my purchase of XOM shares, the capital deployed equates to an average yield of 7.43%.

I added 2 shares of Magellan Midstream Partners (MMP) to my portfolio at an average cost of $47.17 a share and a total cost of $94.34.

The $8.22 in annual forward distributions added to my portfolio as a result of my purchase works out to a 8.71% yield.

Furthermore, I added a share of Eastman Chemical Company (EMN) at a cost of $53.05.

Against the $2.64 in annual forward dividends added by my purchase of EMN, the capital deployed equates to a yield of 4.98%.

Moving to the pharmaceutical industry, I added 4 shares of Pfizer (PFE) to my portfolio at an average cost of $34.35 a share and a total cost of $137.40.

This added $6.04 in annual forward dividends to my portfolio, which works out to a yield of 4.40%.

Concluding my activity within the industry, I added a share of AbbVie (ABBV) to my portfolio at a cost of $87.92.

The $4.72 in annual forward dividends works out to a 5.37% yield.

Wrapping up my purchases, I added to my position in General Dynamics with the purchase of 1 share at a cost of $164.45.

When considering the $4.08 in annual forward dividends added by my purchase of GD, the capital was deployed at a yield of 2.48%.

It is important to note that as a result of my decision to subscribe to Robinhood Gold and use margin, I am positioned to incur $60 in annual subscriber costs and $219.95 in annual margin interest for total costs of $279.95.

Concluding Thoughts:

Against the $430.83 in annual forward income added as a result of dividend stock purchases and the reinvestment of my retirement account dividends, I added $150.88 in annual forward dividends.

When I include the $1.81 in annual forward dividends that were added due to dividend increases last month, I added $152.69 in annual forward dividends during the month of March.

I deployed $6,175.29 in capital during the month of March, which equates to an average yield of 6.98%.

Heading into the month of April, my annual forward dividend income is approaching $1,100.

Give yourself a pat on the back if you read this post from start to finish because my fingers are practically sore from typing this post! Fortunately and unfortunately, my investment activity will be dropping off quite a bit as I deleverage my Robinhood margin down to about $1,000.

Discussion:

Did you add any new positions last month as I did with my purchases of OKE, STOR, MAIN, and UPS?

How was your month in terms of capital deployment?

As always, thanks for reading and I look forward to replying to your comments in the comment section below. 




Tuesday, April 14, 2020

Why I Decided To Use Robinhood Gold And Margin

As I'm writing this post, the number of confirmed COVID-19 cases continues to significantly increase.

When I wrote my post last week discussing my dividend income for the month of March 2020, the number of confirmed COVID-19 cases just surpassed 1 million, and they are now approaching 2 million, with over 1.8 million cases confirmed as of April 12.

Deaths have tragically surged from 66,000 to over 113,000 in the past week and our lives continue to be different in virtually every aspect compared to just a few weeks ago.

Just as tragic as the deaths themselves is the economic impact on the lives of millions of Americans as unemployment claims in the United States over the past 3 weeks are around 17 million.

With that aside, I'll be delving into the intent of this post, which is to provide rationale for my recent decision to subscribe to Robinhood Gold and use margin in my Robinhood portfolio.

Robinhood Gold Offers Valuable Insights from Morningstar

One of the primary reasons that led me to subscribe to Robinhood Gold was the fact that Robinhood Gold comes with free Morningstar reports on just about every company in my 72 stock portfolio (including fractional share holdings in M1 Finance).

These Morningstar reports are very comprehensive, including an investment thesis, fair value estimate, economic moat rating, risk summaries, and stewardship rating.

Without even considering the next point, Robinhood Gold and its accompanying Morningstar reports provide valuable insight into prospective investments and are a helpful facet of my investment research process.

Margin Offered A Way For Me To Sustainably Leverage Capital

The $5/month cost of Robinhood Gold is offset by the $1,000 of interest free margin provided by Robinhood Financial, which means the reports from Morningstar are essentially paid for by the dividend income produced by the first $1,000 of margin.


While using nearly $5,800 of margin on a portfolio that is barely worth $10,000 is a fair amount of margin, I don't believe it is unmanageable in light of my liquidity situation given that I have nearly $2,000 of available liquidity in my savings account and my car is nearly paid off, which is my only meaningful liability.

Because of this, I will be able to completely pay off the interest portion of the margin in the next 3 months.

Further supporting this point, I will soon be paying off $2,000 of margin, which will help improve my margin maintenance.

When I take into account that my portfolio would have to fall a bit more than 50% as it is, I feel comfortable with my current situation, though I will be paying off all but the $1,000 of the interest free portion in the next 3 months.

Concluding Thoughts:

So, there you have it. Robinhood Gold itself offers insights from Morningstar, which include a discussion of risks facing stocks, fair value, and other helpful tools. This alone is worth the $5/month cost of Robinhood Gold, which comes with an interest free $1,000 of capital to deploy into high-quality dividend stocks.

It was my perception that the recent downturn and plummeting into a bear market offered a great opportunity to purchase equities at bargain prices relative to the interest rate charged by Robinhood Financial (which I'll detail in my post next week) while I'm also only 3 months away from obtaining the capital necessary to pay off my margin balance aside from the interest free $1,000 of margin (not to mention the remaining debt on my car).

It would have taken a significant further plunge into a bear market we have not seen since the likes of the Great Depression for a margin call to be issued, which gave me some sense of comfort that I was not overleveraged and at a heightened risk of a margin call.

While it's still too early to tell whether we will go back into a bear market and I have no intention of remaining leveraged beyond the $1,000 mark, I do believe that we have ultimately entered into a new bull market and the American economy will be back up and running before this summer arrives.

Discussion:

Do you use margin or do you refrain from using margin?

What is your rationale for your decision?

As always, I appreciate your readership and welcome any comments in the comment section below.

Tuesday, April 7, 2020

March 2020 Dividend Income

As I'm writing this post, the COVID-19 pandemic reached an unfortunate milestone as a virus: 1+ million infected and a heartbreaking 66,000 deaths worldwide.

In my state of Wisconsin, there are 2,112 confirmed cases and 56 deaths reported as of April 5.

Aside from writing weekly blog posts and articles, it's difficult to find an aspect of my life that remains the same in the midst of this pandemic.

While some of the outcomes have been beneficial in my case, such as being able to work from home and saving time and money in the process, other outcomes such as no Bucks basketball have been difficult to endure.

In the meantime, I am just content with the fact that none of my immediate family members have exhibited symptoms of COVID-19 to date and we are doing everything we can to get through this outbreak as millions across the world are doing as well.

With that aside, let's delve into one other factor that has remained relatively constant in my life, which is my dividend income for the month of March 2020.








During the month of March, I collected $90.31 in dividends net of the $14.95 in Robinhood Gold membership fees and interest on the margin (I'll be going over my recent decision to use a bit of margin in a couple weeks).

Adjusting for the $7.14 in special dividends received in December 2019 from my CAIBX holding when I collected $91.63 in total dividends and the PepsiCo (PEP) dividend, this represents a quarterly growth rate of 4.6%.

Against the $57.53 in dividends that I collected in March 2019 and factoring out the PEP dividend, this represents a YOY growth rate of 53.7%!

Breaking things down a bit more, I collected $48.36 in dividends from my CAIBX retirement holding, $43.21 in net dividends from the 16 companies in my Robinhood portfolio that paid dividends during the month, $13.18 in dividends from the 6 companies in my Webull portfolio that paid dividends during the month, and $0.51 in dividends from the 25 companies in my M1 Finance portfolio that paid dividends during the month.

The additional $5.82 in dividends collected during the month was as a result of the following developments in the portfolio:

Starting with the retirement account, I received an additional $6.35 in dividends from my Capital Income Builder (CAIBX) holding as a result of the continued retirement contributions from myself and my employer.

I received my first dividend from Broadcom (AVGO) since I initiated a position back in December 2019, which boosted my dividend income by $6.50 across my Webull portfolio and Robinhood portfolios.

The other activity in my Webull account was the dividend increase from Prudential Financial (PRU) in February, which added $0.30 to my dividend income.

The timing of the PEP dividend boosted my dividend income by $1.91.

The purchase of shares in Digital Realty Trust (DLR) last December added another $3.36 to my dividend income.

My purchase of shares in L3 Harris Technologies (LHX) in November 2019 and the dividend increase in February resulted in a $1.70 addition to my dividend income.

British Petroleum's (BP) dividend increase announced earlier this year increased my dividend income by $0.06.

Sticking with the trend of dividend increases, Home Depot's (HD) dividend increase announced in February generated an extra $0.14 in dividend income during the month.

Yet another dividend increase for me was the increase announced by Dominion Energy (D) last December, which boosted my dividend income by $0.09.

Realty Income's (O) dividend increase announced in January added $0.02 to my dividend income during the month.

Amgen's (AMGN) dividend increase announced in December boosted my dividend income by $0.15.

Rounding out dividend increases that boosted my dividend income during the month is the increase from Pfizer (PFE), which added $0.16 to my dividend income.

Robinhood Gold fees and interest on margin resulted in a $14.95 expense for the portfolio during the month of March.

The final bit of activity came in my M1 Finance portfolio. Aside from the timing of the PEP dividend which added $0.02 to dividend income, the notable activity was an increase in the dividends that I collected from my position in PRU, which also boosted my dividend income by $0.01.

Concluding Thoughts:

The portfolio continues to slowly advance and given the timing of some of my purchases where I used margin and my continued retirement contributions, I expect to surpass $100 in net dividend income in June.

As I conclude paying off my car and federal tax liabilities in the weeks ahead, I plan to use all of my disposable income to either pay off my margin or opportunistically add to positions.

Discussion:

How was your March in terms of dividend income?

Did you have any new dividend payers as I did with DLR, AVGO, and LHX?

As always, thanks for your readership and I look forward to reading the comments that you are free to leave in the comment section below.




Tuesday, March 31, 2020

Inept Government - Yet Another Reason To Be A Dividend Growth Investor

In the midst of this COVID-19 pandemic as the world approaches 1 million confirmed cases, I find myself with a bit of extra time on my hands because as I mentioned in my previous blog post, I am now working from home and saving several hours a week on commuting/getting ready for work (not to mention financially on transportation costs).

With the NBA season postponed for the foreseeable future and very little NBA news to follow, especially pertaining to the Milwaukee Bucks, I actually find myself with an extra 7-8 hours a week including the extra sleep that I have been getting.

While I have been using most of that extra time to unwind and watch TV programming, I can't help but find myself thinking about the future.

One thing in particular that has been on my mind for quite a while and most recently, is the fact that the Social Security trust funds that fund Social Security retirement benefits in conjunction with FICA tax contributions are projected to be fully depleted by 2035, according to the 2019 Social Security Trustees Report.

With this in mind, it raises concerns about the future of programs that tens of millions of Americans depend on, leading me to the following statement.

The U.S. Government Is Beyond Dysfunctional

Without being too political (as I find politics to be a distraction from our government's inefficiency and incompetence to pit us against each other), you don't have to even follow the news to know just how unreliable and dysfunctional our government is perceived to be at protecting our best interests as citizens.

Whether you consult with others that you personally know or reference the study conducted by Pew Research Center that found only 17% of Americans said that they could trust the government to do what is right, it's abundantly clear that the vast majority of Americans don't trust the government, and rightfully so.

Rather than actually addressing the fact that our programs for retirees are at risk of becoming unsustainable in the not so distant future without further action, the Washington elite are playing politics and focusing on issues that are politically expedient, "kicking the Social Security can down the road" rather than doing the responsible thing and being pragmatic to secure the future of these programs for us and our posterity.

While I do believe that politicians will eventually address this issue with some combination of FICA tax hikes or increases in the retirement age to address the improved life expectancy rates since the implementation of Social Security, and they will face no choice but to do so given the popularity of these programs, I believe it is better to be safe than sorry and to take control of your financial future.

You Must Trust Yourself To Secure Your Financial Future

While I understand that many in the American public are unsure of how to take control of their financial future and often lack the knowledge of personal finance to do so (let's face it, personal finance can be boring for most people), it is essential for everyone to do so because nobody else is capable of handling your financial future as well as you are capable of once you develop an understanding of budgeting and investing.

Dividend growth investing has proven to be a highly effective strategy in conjunction with purposeful budgeting to secure one's financial future and eventually achieve financial independence to enjoy one's retirement without worry of running out of money or relying on the government or an employer for retirement benefits.

We only need to look to the likes of Jason Fieber of MrFreeat33 to realize the true potential of living below your means and investing in high-quality dividend growth stocks.

If you haven't read Jason's story, I would encourage you to do so as it is incredibly inspiring.

Jason was one of the very first individuals in the online community that shaped my thoughts and led me to eventually select the dividend growth strategy when I began investing in September 2017.

Jason's story proves that it is possible for everyday folks like you and I to achieve financial independence with sensible budgeting, an effective approach to investing such as the dividend growth strategy, and patience.

For newer readers of the blog or readers that would like a refresher on the reasons that led me to become a dividend growth investor, I would refer them to this post.

Concluding Thoughts:

Regardless of your political beliefs and whether you believe the government will come through and secure the continuity of Social Security retirement benefits, the moral of the story is that you shouldn't be depending upon others to secure your financial future, especially out of touch bureaucrats in Washington.

There are so many personal finance bloggers out there that have reached financial independence and serve as a model for us to follow in one way or another such as Jason Fieber, so it is important for those of us in the community to spread the message to those that maybe aren't up to speed on the need to secure their financial future independent of the government, employer pensions, etcetera.

Discussion:

What are your thoughts on the situation regarding the sustainability of Social Security retirement benefits?

Do you believe that you will be able to personally recover all of your contributions into FICA taxes once you reach the age of being able to collect your benefits?

Am I blowing the need to secure one's financial future out of proportion?

As always, I appreciate your readership and welcome any comments that you are free to leave in the comment section below.