August 2019 Summary

Just like that, summer is over. It’s time to get back to school and I can already see the effect around. My colleagues are complaining that the traffic is getting worse and they need to prepare kids for school/kindergarten. Luckily, our baby-daughter is still too young to go to kindergarten and I am walking to work on foot, so I am not sharing those troubles yet.

Summer was great and it was very different to what it used to be when we were baby-free. There were less parties but we visited seaside and nearby lakes much more often than we used to. Unfortunately, August also included first illness of our daughter and an overnight stay in a hospital. Luckily, it was not serious and we are all feeling well now.

Enough with the summer overview. Let’s get to passive income my portfolio generated during the month of August.

Dividend Income

This month I received dividend from 5 companies:

That’s not too bad for an August.

As always, let’s see what part of expenses, related to the companies, the dividends could cover if I decided to spend them:

• $9.54 from AT&T would cover 40% of what we spent on Cellphone bill during the last 3 months;
• $8.92 from CVS Health would cover 8.1% of our expenses on Barber for the last 3 months. Since it is my second Healthcare company (after PFE), I decided to assign it to another category of our budget
• $2.54 from Realty Income would cover 0.4% of our monthly Rent;
• $4.70 from Procter & Gamble would cover 3.1% of our Cosmetics & Hygiene expenses for the last 3 months;
• $6.05 from Starbucks would cover 2.3% of what we spent on Eating Out during the last 3 months.

There is long way to go for dividends to cover significant amount of our monthly expenses but performing this fun exercise gives me motivation to keep going.

Year-on-Year Comparison

Let’s compare dividend income to August of last year:

I can’t complain about the increase of 61%. This is what caused it:

• New addition of CVS Health to my portfolio this Spring;
• AT&T position was moved from my old broker and I added a few shares in the process. In addition, AT&T raised their dividend slightly;
• Dividend increases from Realty Income and Procter & Gamble also helped slightly.

There is no increase from Starbucks compared to last year. I expect them to raise their dividend in Autumn, so I shouldn’t worry about this. Actually, I am very happy with performance of SBUX, as its stock price increased by ~85% since I purchased them a year ago!

This is how my dividend income progress looks like since the beginning of 2016 when I started tracking it:

Purchases and Portfolio Contributions

This month I added €500 to my investment account which is slightly lower than usual.

I haven’t invested to any new companies. However, I finally moved 4 remaining US positions from my old broker to my new broker. Now I will need to pay 15% withholding tax on dividends, compared to 30% at my old broker. This transfer cost me €51 but it resulted in $21.56 increase in projected annual dividend income.

I haven’t added any funds to P2P lending platforms.

Dividend Increases

This month one company in my portfolio announced a dividend increase:

With dividend increases being much smaller compared to last year, I really can’t complain about the news from ITW. It’s actually the biggest increase in percentage terms so far this year for my portfolio.

Changes in Projected Annual Dividend Income

As I mentioned in previous posts, I have a goal to increase my PADI to $450 from US companies this year. At the start of the year it was standing at $236. This means that I should add additional $214 (or $18/month in average) if I want to achieve the target.

To track the progress, I monitor PADI increase/decrease from two sources – dividend increases and capital contribution.

Let’s see how forward dividend income changed during July:

Even though I haven’t added any additional stocks, PADI increased because I moved my remaining US stocks to the new broker.

I am very close to my target now (only $6 missing), so I am very optimistic to reach this goal, maybe even next month.

P2P Lending Income

This is how my income from P2P lending looked like in August:

Interest from P2P lending added €9.32 to passive income this month.

I am no longer adding any funds to Savy platform and actually transferred €50 of returned back loans to Mintos this month.

In general, I would like to keep P2P lending portfolio at ~5% of my overall portfolio. Currently it stands at 5.2% of my overall portfolio.

If you would like to sign up with Mintos and receive some cashback, feel free to use my referral link (I would also get a small commission).

Summary

In total (after converting to EUR) I received €38.15 in passive income during August. This brings the total for 2019 to €373.67 which is ~77% of my goal to receive €480 this year. I am on track to reach the goal, as we still have 4 months left.

I feel very fortunate to be in a position where I can save part of my salary and slowly build passive income. At the beginning it seems very slow but I believe that the numbers will only get better if we keep consistency. Seeing the income grow each month is very motivating and I don’t see any reason to stop.

How was your month? Are you sharing any dividend payers with me? Did you have a nice summer? Let me know in comments below and thanks for reading! 🙂