Dividend Income – January 2019

It’s unbelievable how fast the time flies. 2018 is history and we are already in the second month of 2019. In the rearview mirror, 2018 has been a terrific year. First of all I finally managed to launch this blog. And starting blogging has already transferred my life for the better. The simple process of tracking the progress and writing down the goals, helps a lot to stay focused and motivated. That’s pretty awesome! But what I value even more is that blogging connects me with like-minded individuals from all over the world. No matter the distance and nationality, we all share similar interests and goals. That is why I enjoy exchanging opinions with people from the DGI community, and quite frankly appreciate input from others whose opinions may not be the same as mine.

Another passion of mine is traveling. I prefer gathering great experiences and moments over collecting fancy things. Packing the bags and going to a place where you haven’t been before, is one of the best methods to meet this requirement. Thinking back, the best memories I’ve ever had are somehow connected to traveling. In 2018, I managed to visit two new countries: Thailand and Portugal. I always have a big smile on my face recalling the adventures from both trips.

Last but not least, 2018 has been quite succesful in terms of moving further towards my financial goals. For the first time, the SF portfolio has generated a four-digit annual income. I received €1,163.80 in net dividends for 2018 – which is a year-over-year growth of 66%. This is clearly a result of being consistent with investing. With every new acquisition, the snowball is growing bigger and bigger. My plan is to continue the same way in the new year. As the first month of 2019 is behind us already, it’s about time to have a look on the dividend performance. Below is a summary of my dividend income for January 2019.

Dividend Income: January 2019

In January 2019, six companies have provided me with a dividend check:

  • Pepsi (PEP): €13.75
  • Altria (MO): €37.65
  • Illinois Tool Works (ITW): €9.56
  • Walt Disney (DIS): €9.71
  • Philip Morris (PM): €16.68
  • JPMorgan Chase (JPM): €10.63

In total January’s dividends sum up to €97.98 ($112.19). Not bad! Actually not bad at all when comparing to the dividend income from January 2018 of €25.26 ($28.92). That’s a growth rate of 288%. Wow! Did I mention already how much I enjoy being a dividend growth investor?

Month2019
2018
+/-
Total€ 97.98€ 1,163.80
January€ 97.98€ 25.26+ 288%
February€ 55.35
March€ 107.33
April€ 84.92
May€ 177.26
June€ 103.13
July€ 50.96
August€ 190.84
September€ 125.87
October€ 54.34
November€ 71.56
December€ 116.98

Truth be told, this crazy growth rate is partly due to some extraordinary adjustments. One of them is the reallocation of capital from index funds towards dividend growth stocks in the end of 2018. I reckon that this redistribution is going to boost my yearly income by approx. €150 ($172). That’s a fantastic one time effect and I’m more than happy to collect it.

The above chart shows the dividend income broken down by months. Green bars represent the current year and orange bars visualize the previous year. The goal is that each month the green bar should be well above the orange one. That would inevitably lead to a decent growth for the whole year. In this regard, January was a fantastic start. For 2019, I aim for an annual dividend income of €1.600 ($1.832). In conclusion that would equal a year-over-year growth of about 38%.

Currently the projected dividend for 2019 is sitting at €1.330 ($1.523). This is the amount I would receive under the assumption of no new investments and zero organic dividend growth. However, I do expect that many of my holdings will increase the payout in 2019. In addition, I plan to be consistent with investing and add new capital along the way. Consequently the annual income should be able to raise and eventually reach the minimum target of €1.600 ($1.832).

Wrapping things up

I really like the predictability of dividends. While markets continue to be moody, the dividend is most of the time unaffected and safe. Sure, there is a risk that a company might cut its payout. This can’t be denied. But having one or two companies reducing/cutting the dividend is manageable when you hold an army of excellent stocks. Keyword: diversification!

Furthermore by doing some research, we can diminish the risk of buying a potential dividend cutter. Usually there are some alarm signals. Decreasing earnings over time, excessive debt load, overwrought payout ratio, just to name a few. These can be good indicators and it makes sense to monitor them.

In the end, I care much more about the reliability of my income rather than the market value of my portfolio. Ideally, I never want to sell any of holdings. So why should I worry about the price then? In fact, I want to enlarge my portfolio and maximize its cash flows step by step. And January’s income marks just another step towards achieving this goal.

I hope you all had a successful start into 2019!

16 Comments

  1. Engineering Dividends February 3, 2019 at 7:58 pm

    Fantastic start to 2019, SF! Nearly 300% YoY growth is envious.
    I see the tobacco stocks delivered over half of January’s totals. Those two stocks have some amazing yields.
    I share 4 of your 6 dividend payers this month. I’ve had PEP for over 20 years, ITW for a few, while MO and JPM were recent additions.
    Keep up this momentum you’ve got and you’ll be smiling come year’s end.

    Reply
    1. Snugfortune February 4, 2019 at 2:37 pm

      I wish I’ve bought PEP 20 years ago. It would be a nice YOC today 🙂
      MO and PM already carry more than 10% of my annual dividend income. That’s why I have no plans to extend these positions (just because of diversification reasons).
      Thanks for stopping by, ED!

      Reply
  2. DivHut February 5, 2019 at 2:31 am

    The way you describe travel is exactly how I feel. I have been fortunate to see a lot of the world already and am ready to go out and explore more. Since baby DivHut was born we managed more local exploration over international. In any case… love the numbers you put up for January. Great progress with many shared names paying us both last month. Keep it up!

    Reply
    1. Snugfortune February 5, 2019 at 7:11 pm

      Thanks, DH!
      I’ve seen your country visit list. Impressive!
      I would be happy to reach a comparable number one day. Not for the pure purpose of completing a list but rather because I’m genuinely curious to see some new places.

      Reply
  3. My Dividend Dynasty February 6, 2019 at 1:15 am

    Congrats on a super month! Wow, do I love that 288% YOY increase! Triple digits are awesome! Keep up the great work! 🙂

    Reply
    1. Snugfortune February 6, 2019 at 9:20 pm

      Thanks, MDD!
      Definitely great to see such a growth rate in the beginning of the year.
      Cheers

      Reply
  4. Dividend Daze February 8, 2019 at 4:14 pm

    Way to go! Already broke $100 mark in the first month. That is some nice growth. Cant wait to see even more over this year.

    Reply
    1. Snugfortune February 9, 2019 at 4:21 pm

      It was not so long ago when $100/month seemed so far away.
      But compounding works faster than we might think.
      Thanks for the visit, DD!

      Reply
  5. Mr. Robot February 12, 2019 at 10:52 pm

    Inspirational numbers to be sure SF. Looks like you are at the point I want to be in 1.5 years (give or take)

    Great to share PEP and DIS with you!

    Reply
    1. Snugfortune February 13, 2019 at 1:10 pm

      Thanks, Mr. Robot!
      You will get there sooner than expected, I’m sure.

      Reply
  6. Dividend Diplomats February 18, 2019 at 3:18 am

    That’s how you start the year off in style SnugFortune. That reallocation strategy is about to post some INSANE growth rates this year.

    Bert

    Reply
    1. Snugfortune February 18, 2019 at 8:59 pm

      I would love to see such growth rates going forward. But it’s gonna be quite a chellenge to replicate it in January 2020:)
      Cheers

      Reply
  7. dividendfireman February 18, 2019 at 9:28 pm

    Great summary and congrats on your outstanding growth! I agree with you about both dividend investing and the online DGI community. I’ve learned more in the last year than I thought possible. Looking forward to seeing your performance in 2019.

    Reply
    1. Snugfortune February 18, 2019 at 10:20 pm

      Thanks, DF!
      Reading blog posts about DGI topics is pure education to me..in the majority of cases:)
      Cheers

      Reply
  8. Doug February 19, 2019 at 2:28 am

    Looking good some great companies paying you. Keep it up

    Reply

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