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Mid Year Dividend Update: July 2019

A Second Chance at January

We are half way through 2019 and that means it’s time to check in on the progress you’re making toward your goals. I treat July like my second January. This is the month where I revisit my goals and motivate myself to finish the year strong.

Did I slack off in any areas? If so, this is my opportunity to get back on track. While looking over the goals I made for the year I was pleasantly surprised to learn that I was on track with my reading goal (one book a month). If I keep reading at my current pace I will have read no fewer than 15 books by the end of the year.

Unfortunately, everything is not going as smoothly as the reading goal. I learned I’m nowhere near my goal of doubling what I did in dividends last year ($234). I’m currently on track to make $381.44 by year end. And since I prefer to round that number up from $468 to an even $500 I’m going to need $118.56 of new dividend income to reach my goal. 

Reaching this goal is going to take a lot of discipline and hard work. But the upside is that having done this mid-year deep dive into my finances I’ve given myself six whole months to really focus and make it happen. While $118 seems like small change, it’s not small in the dividend world. Most of my stock purchases only create $4 to $8 of new dividend income. I’ll literally spend the next six months chipping away at the $118 that I need to reach my goal. Below is a snapshot of my YOY (year-over-year) dividend progress:

2017 2018 2019
Jan  $-  $-  $1.11
Feb  $0.88  $13.60  $38.24
Mar  $3.71  $12.96  $51.30
Apr  $-  $-  $1.15
May  $2.17  $26.25  $38.88
Jun  $4.91  $16.94  $60.04
Jul  $-  $-  $-
Aug  $2.58  $43.73  $-
Sep  $7.74  $20.89  $-
Oct  $-  $0.22  $-
Nov  $7.88  $54.30  $-
Dec  $11.83  $45.58  $-
total  $41.70  $234.47  $190.72

 

I’ve made an effort to improve the off-dividend months (Jan, Apr, Jul Oct), which will show up in the second half of the year. Currently, the only stock I have paying during those off months is O (Realty Income). As you can see, I’m still in the humble beginnings of this journey. I’m still working to build a solid foundation for each month and working to pull each month over the $100 mark and I’m highly motivated.

This is the most fun that I’ve ever had with money. It’s so empowering to know that with the click of a button I can choose to not reinvest my dividends and have them sent directly to my checking account where I can use that money for fun or to pay a bill, a small bill for now.

I also want to mention that I also receive passive income via interest from the cash and bonds that I own. The interest income that I receive has always been more than the income that I received from dividends. However, I’ve been working hard to flip that around. By putting all extra money into dividends and even allocating money away from bond purchases into dividend paying stocks. Why? Because unfortunately, interest income is tied to the whims of the Federal Government and Pres. Trump (need I say more). And I’m happy to report that June is the first month that I officially made more in passive dividends than I made in passive interest.

This is big because just yesterday, I received a letter from my online bank (Ally) telling me that the interest rate on my high-yield savings account is being cut by 0.10% and that I shouldn’t move my money because I’m still making 15 times more than I would at a brick-and-mortar bank. This is the same for the I-bonds that I purchase directly from the government. They have cut the interest rate from 2.58% down to 1.98%. These rate cuts are not the worse, but they are still headed in the wrong direction.

As for my dividends, the exact opposite is happening. I recently received notices from a few dividend stocks that I own BAC (Bank of America) and SBUX (Starbucks) that they would be raising their dividend payouts. This was great news, of course, and will certainly help me chip away at the $118.54 I need in additional dividend income.

If you are reading this, I hope you are encouraged to jump in and create your own dividend portfolio. The goal should always be to empower yourself. You should be on a mission to build and collect streams of income that eventually cover all monthly living expenses.

Remember, It’s a fight to build wealth no matter where you are in the process. Everything around us conspires to take money out of our hands. But you must fight the good fight. Continue to save, invest, and grow your net worth even when it seems impossible. Save your pennies (copper) until they become dollars (cotton).

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