Here is my May 2015 dividend income report. May has been a very busy with our home renovations kicking into high gear. The new windows, furnace and A/C are beating the hell out of our net worth. In spite of that expense my monthly passive dividend income continues to increase.
First a mid-year reality check. I’m still confident that we’ll be able to achieve our net worth goal of $725,000 this year. I’m also confident that we will likely exceed our annual dividend income goal of $7,500. Our total to date is $2,608.29 so we’re already 1/3 of the way there. At this point due to the major renovation work we will not be paying down our mortgage this year. That’ll have to come next year.
My wife is on a Mat leave until July so money’s been tight. Once she’s back to work we can tackle the renovation bills and start investing more money.
I’ve received a few dividend raises this month that will increase my quarterly dividend income. Sun Life Financial (SLF) and Manulife Financial (MFC) each raised their dividend by 6% and 10% respectively and Bank of Montreal (BMO) and CIBC (CM) increased theirs around 2.5% each. So far this year nearly every one of my companies have raised their dividend. Hopefully there will be further increases because life keeps getting more expensive!
I made some small investment purchases this month. I saw that CPD (the iShares preferred share ETF) was down so I bought another 100 shares to re-balance my RRSP.
I initiated a new position in Telus (T). Ever since BCE absorbed the rest of Bell Aliant last summer I’ve been thinking about adding another telco to my portfolio. There’s no question that Telus is a great company and an excellent long term investment that I probably should’ve owned anyways. So I bought 1 certificated share through a share exchange website. This will be a full DRiP where 100% of the dividends will be re-invested to purchase more shares of Telus. It will also be 100% taxable because our TFSAs will be full very soon.
I decided to add and accumulate Telus shares in this way because, with all the renovation work around our home, I don’t have tons of cash to invest like I did last year. This way I can contribute small amounts to build up my position. Telus offers a monthly share purchase plan with a minimum contribution amount of $100. I’m sure I can find an extra $100/month to start investing so that’s my plan. Another great feature that Computershare offers is the automatic debit plan where every month they debit money direct from my bank account to purchase more shares in my favorite companies. This saves me the hassle of having to mail in share purchase forms and cheques.
I also continued with my plan to make regular monthly and quarterly share purchases in my dividend reinvestment accounts (DRIPs). I bought more shares in Emera, Bank of Nova Scotia and Bank of Montreal. In these accounts there is no point in trying to time the market – I contribute small amounts on a regular basis, regardless of what is happening in the market and I let compounding and dollar-cost averaging do their work. All of this automatic saving and investing is the primary reason that my dividend income is constantly increasing. The 2 most important things I learned from David Bach’s The Automatic Millionaire is to #1 take the time to setup automatic savings/investing plans and #2 increase those amounts on an annual basis.
Monthly Passive Dividend Income
As I’ve mentioned before, February, May, August and November are generally my weaker dividend income months as I only own a handful of companies that pay out in those months. With some dividend increases and the purchase of additional ETFs that pay a monthly distribution I’m happy to see my monthly income start to rise. More and more I’m finding how great it is to be a dividend investor. Beyond this, I did not initiate any new positions – I just made the same, regular investments into the same collection of stocks, ETFs and index funds.
May has been a decent month with regard to dividend income. Here are the numbers:
Emera (EMA) – $14.04
Bank of Montreal (BMO) – $41.82
Procter & Gamble (PG) – $78.49
RioCan Real Estate Investment Trust (REI) – $3.98
iShares S&P/TSX Canadian Preferred Share Index ETF (CPD) – $57.96
iShares S&P/TSX Capped REIT Index ETF (XRE) – $37.44
Canadian Short-Term Corporate Bond Index ETF (VSC) – $18.06
Canadian Short-Term Bond Index ETF (VSB) – $13.91
TOTAL = $265.70
Image credit: Photo by Stuart Miles / Freedigitalphotos.net