Welcome to my January 2016 investment income report. This report will help me track all of my investment income from the rental property, dividend stocks, index funds and exchange-traded funds (ETFs).
On the investing front, surprise, surprise, I’m still buying the Canadian banks. I continue to make extra cash purchases in my DRiP account to buy more Bank of Nova Scotia and Bank of Montreal. I also continued with my longstanding plan to save and invest automatically. I continue to invest in low-cost index funds in our retirement accounts and I also continue to make automatic share purchases in my DRiP accounts. This month, I bought more shares in Bank of Nova Scotia (BNS), Bank of Montreal (BMO) and TransCanada Corp (TRP).
The great thing about being a dividend investor is that all of my dividend income is automatically re-invested. Every month this income buys more shares in my favourite companies that will, in turn, produce even more monthly income for me. This is how compounding works and is why it’s such a powerful force…what Einstein called the “Eighth Wonder of the World”!
Going over the numbers this month, I realize that the majority of my dividend income comes from Canadian banks. While I love the banks, I need to diversify a bit more. So I’ll be focusing on building up my positions in Telus (T), BCE (BCE) and my pipelines and utilities. In my RRSP, I think I’ll add to my REITs by buying more shares in XRE.
I had 2 companies raise their dividend this month and, unfortunately, 2 companies that cut their dividends. Canadian Utilities (CU) raised its dividend by 3 cents or 10%. (CNR) also raised its dividend by 6.25 cents or 20%.
TransAlta cut its quarterly dividend by 78% from 0.18 to just 0.04 cents. Luckily I only have a very small position in this loser. Next, Potash Corp of Saskatchewan (POT) cut its dividend by 34% from USD $1.52 to $1.00! Both companies are only a small part of my overall dividend portfolio but these examples just go to show that quality really matters when it comes to dividend investing.
Monthly Passive Dividend Income
January has been an excellent month with regard to dividend income. In fact it’s been a very strong month, coming in at a solid $1088.77! This month’s dividend income has grown by nearly 50% from that of January of 2015 ($726.79). Now a large part of that increase came from investing my own personal savings, while the remainder was due to the regular reinvestment of my dividend income and from companies raising their dividend payout.
We are starting the year off right with 1,088.77$ in passive dividend income. Here is the breakdown on the numbers:
Bell Canada Enterprises (BCE) – $27.13
Telus (T) – $4.50
KP Tissue Inc. (KPT) – $95.22
RioCan REIT (REI) – $4.14
TransCanada Corporation (TRP) – $14.55
Bank of Nova Scotia (BNS) – $474.04
Canadian Imperial Bank of Commerce (CM) – $25.21
Toronto Dominion Bank – $326.40
TransAlta (TA) – $3.24
ETFs and Mutual Funds
iShares S&P TSX Canadian Preferred Share Index ETF (CPD) – $51.95
iShares S&P TSX Capped REIT Index ETF (XRE) – $39.11
Vanguard Canadian Short-Term Corporate Bond Index ETF (VSC) -$13.49
Vanguard Canadian Short-Term Bond Index ETF (VSB) – $9.79
Total = $1088.77
With both units rented out, we managed to make a small profit this month after all expenses. We updated the electrical in both units when we purchased the property and are paying this in monthly instalments. January was our final payment and we can finally look forward to some excellent profit next month. I think our monthly profit on the rental will be somewhere around $500.
Total Monthly Rental Income = $107.58
Our annual passive income goal is $10,000 so we are already 12% of the way there.
This brings the grand total for our January 2016 Investment income to $1196.35!
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