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.
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.
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.
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.
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!