Can you believe that the year is over? I still keep writing 2018 when I need to write a date somewhere. I guess I will get used that we are already in 2019 but my brain is not fully there yet. With that said, it’s time for the last edition in 2018 of my favorite monthly post – passive income summary.
Dividend Income
This month I was paid by three companies:
Almost $13 received for doing nothing else but holding a few shares of some great businesses. As always, I like to imagine what part of our expenses I would be able to cover if I decided to spend the dividend:
- $6.43 from Pfizer would cover 6% of our health-related expenses for the last three months;
- $4.02 from Exxon Mobil would cover 1.4% of our car & transportation costs for the last three months;
- $2.47 from Realty Income would cover 0.4% of our monthly rent.
This is just a fun exercise I like to play. It makes the dividend feel more tangible and gives motivation to keep investing.
Year-on-year Comparison
Let’s see how the dividend income compares to what I received last December:
Wow, more than 100% increase is what I love to see! Most of the increase came from the acquisition of PFE. If I were to exclude this, the annual increase of dividend from XOM & O would have been 9% which is much higher than annual inflation and that’s why I like the concept of dividend growth investing. If we were to live off dividends one day, the dividend growth should cover inflation rate. I understand that this is just the beginning of a journey but it feels good to be in a better situation than yesterday, no matter how small the steps are.
This is how my dividend income progress looks like since the beginning of 2016 when I started recording it:
Purchases and Portfolio Contributions
This month I dedicated €1100 to my investment account. It’s much higher than usually, as I had some extra savings from previous months that I decided to contribute to the investments account. I used this money to initiate one position during December. I bought 3 shares of Blackrock (BLK) for $400/share + $7 commissions for a total of $1207.00. You may read more about this purchase here.
Dividend Increases/Decreases
During December, 3 companies in my portfolio declared dividend increases. That’s the highest number of companies to deliver good news in my short investing history! I even decided to make a table to better represent the increases and highlight the impact to my projected annual dividend income:
The increases are not big. Realty Income is known to increase their monthly dividend every quarter by a small fraction of a cent. AT&T also didn’t surprise and increased their quarterly dividend by a single cent or 2%. The slightly bigger increase came from Pfizer at ~6%. After adding them up, my projected annual dividend income increases by $2.11. It’s not a lot but as Lanny and Bert from Dividend Diplomats say – every dollar counts!
P2P Lending Income
This month I received €7.25 in interest from P2P lending which is similar to what I received last month. My loans portfolio currently consists of 60 loans for a total value of €665.97. Throughout 2018 I received €76.25 in interest and late fees from P2P lending platform in total. Even though my investment in this platform accounts only ~6.5% of my investments compared to dividend paying stocks, it generated almost 30% of my annual passive income in 2018! I mentioned before that those investments are not very liquid but the yield is really good so far. I still treat it as a riskier type of investment so I am planning to keep it up to 10% of my portfolio.
Summary
In total (after converting to EUR) I received €18.42 from passive income during December. This brings my total for 2018 to €255.32 which means that I reached my goal to receive €240 from passive income throughout 2018!
It really was an amazing year. The biggest and most memorable thing was the birth of our baby-girl and I often catch myself thinking how happy I am. I have everything I could wish for – a loving wife, beautiful baby-girl, I am healthy enough to be able to train for triathlons, have a job that I like (most of the time) which lets me save part of my income and dream about financial independence. I am not sure if we will ever get there or if there even is a finish line but I am enjoying the journey so far!
What about you? Did you finish the year strong? Are you happy with the results of the year? Have you managed to reach your goals? Feel free to leave your comments and thanks for reading!
Hi BI. We finished Y2018 with 409€. Growht was minimal as I invested in US stocks and Baltic ones failed with their dividends 🙁 Going forward growth should be more stable 🙂 Hoping to hit 500€ in 2019 😉
Hi P2035,
Congrats, €409 is not bad! I agree that dividends in Baltic market are not stable but they usually have a higher yield, so you win some and lose some. But I also prefer US stocks that tend to raise their dividends each year.
Good luck in hitting €500, I am pretty sure you will make it!
Well its a bit tricky. Im thinking about cash accumulation vs investment for Y2019. I have a fealing that great sale will come in Y2020. If im wrong I will have the cash at my hand to invest 😉
Well its kinda tricky re 500€. I have goal for y2019 to accumulate cash but not invest so my dividends might be flat. I have a gut fealing that in y2020 shares will be much cheaper then today. 2019 dec correction looks like the beggining. With fed rate increase I predict capital ecodus from stocs/bonds to deposits. Why invest in dividend paying stocs witj 1-2% yield when you can get 4-5% on deposits.
We will see gow it goes. I personally cannot tell if the shares are going to be higher or lower after a year, so I am just going to keep investing when I have some funds and grow my dividend income from companies I see attractive 🙂
Eithar way I need to have few kEUR cash reserve. its a clasic that you need 6mo reserve of you basic need expenses. For us that would be something 3-6kEUR 🙂
Congratulations on reaching your annual passive income goal! It’s always nice to see some dividend increases even if some of them are slightly smaller. Also have some T and O in my own portfolio so these raises increase my passive income too!
Hi DD,
Thanks for the comment and we have to appreciate those increases, no matter how small they are. Every dollar counts! 🙂
Congrats on not only reaching but exceeding your passive income goal for the year! Also, I think that last paragraph is the best part as that is what this is really all about–enjoying life and being happy in the day to day, and it sounds like you’re doing great there!
With the raises, that $2.11 might seem small but at an average portfolio yield of 3% that would require an investment of $70 to earn. The best part is that it continues to build and before too long the raises and reinvested dividends are producing more than the capital we can invest. I know some in the DGI community are at that point and it is a beautiful accomplishment.
Keep up the great work!
Thanks a lot for the nice words DivvyDad! I am thinking more and more in the recent years about what brings joy to me and I learnt to appreciate the small moments. It’s easy to get lost in the rat race in many areas of our life, so I think it’s important to sometimes stop and appreciate what you have 🙂
It’s funny that I also used the example of investing ~$70 to earn $2 in dividends while walking with my wife yesterday. I can’t wait for those increases to become bigger as the portfolio grows 🙂
Great job on achieving such an increase in 2018! And of course big congratulation on the birth of your daughter:)
Keep on investing consistently and you will see another good year in 2019.
Cheers
Alex
Hey Alex,
Thanks for the nice words!
Have a good and productive 2019, too!
Congrats on a terrific year, BI, especially on the homefront with the birth of your daughter.
It’s great to hear that you achieved your investing goals. Did you succeed on your triathlon goals as well?
You topped me with those 3 December dividend raises… I only had 2. Soon enough, 3 raises will seem like a slow month for you. Keep investing! Best of luck in 2019.
Hey ED,
Thanks for the comment! Yes, it was a great year. I managed to reach my triathlon goals as well. The only fitness goal I didn’t achieve was a marathon in 3:45:00 (I finished in 3:47:00) 🙂
Haha, I can’t believe that I had more companies raising dividends in my portfolio than you – that won’t happen often 😀
I think you nailed it this year BI, on personal and stock level 🙂
More then 100% growth is just spectacular and as always love your positive vibe. I can’t wait to see what you will do next year.
Thanks Mr. Robot, it means a lot! Reading such comments is one of the reasons I love having this blog 🙂
I am planning to publish my goals for 2019 in a few days 🙂
Congratulation on successful year BI and looking forward to your ambitious goals.
What YOY growth in family members do you expect in 2019? 🙂
Haha, we don’t expect any growth in this area in 2019 😀
Thanks for the comment 🙂
An excellent finish to the month BI! Congratulations on finishing strong and posting a phenomenal growth rate in December. Love that new PFE dividend compared to last year. I wish I owned more of them to be honest. Let’s start out strong in 2019 my friend!
Bert
Hi Bert,
Thanks a lot for the nice words! Of course, let’s make it count in 2019! 🙂
Nice growth I’m starting over my journey so this is just motivation for me
Thanks for visiting Canadian Yardie! Good luck on your journey! 🙂