Dividend and Expense Review – April 2019 – Monthly Dividends
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Welcome to the April update! April is always smaller month. In fact, last year it was my second smallest dividend month of the year. That’s because I don’t really have any individual securities that pay in this month. However, my monthly dividends are trending up thanks to my investments in my M1 Finance account. On top of that, cash and bond yields have shot up since last year too which helps as those pay monthly dividends too.
I opened my M1 account a few months back and have been putting some extra cash into some slices I created there. Those slices include individual stocks that pay in various months which helps these off months. The majority of my money is still in ETFs and mutual funds that pay quarterly. However, some extra cash is flowing into my taxable accounts and that will certainly help these historically smaller months. I’m really enjoying M1 as a good free way to invest in individual stocks while staying diversified and you can read my review of it here.
One of my financial goals this year is to grow dividends at least 19%. So far, things are off to a good start since I’m 34.6% higher after Q1 versus last year. That’s certainly a good news and driven in part by the extra money flowing into stocks. I always max out my 401k and Roth IRA but having some extra money going into taxable accounts helps too.
The reason I’m able to do that is because my savings rate is improving this year too. We had an expensive year last year with my wedding and honeymoon but I don’t have those big expenses this year. That’s good news for these updates and for my potential to hit my goals.
Let’s start with dividends first. Last year’s April came in at $107.56 so let’s see where we are this year. I’m hoping it’s a good number since we’ve seen a big uptick in yields since then.
April ends up with $240.00 in dividends! That’s a 123.13% growth over the last year, one of the biggest growing months I’ve ever had.
One other boost to this month is that two ETFs paid a small amount out in April when they normally do so in March. However, even without those, the growth rate would have been nearly 100%!
April brings the yearly total to $2689.94! That’s a 39.6% growth rate year to date. I’m certainly killing inflation with this!
It’s exciting to see these off-months get so high. In 2016, when I first started tracking this, I had 5 months under $100 and now I’m starting to see at least $200 most months. That’s pretty impressive growth. These off months aren’t so bad anymore as my monthly dividends grow.
The combination of monthly dividends growing, additional money flowing into my accounts and reinvestment of current monthly dividends helps fuel that fire. Once you get the ball rolling, it starts to pick up speed at a pretty impressive pace and it’s amazing how much growth I’ve seen so far this year. The statement that the first $100k is the hardest is so true and it applies to dividends too. The first few years are slow but once you get past that, the growth really gets impressive.
This is only helped by the fact that this $240.00 was quickly reinvested into other dividend paying securities. It’s not much but that will boost my forward income by about $5.52 annually. Every little bit counts!
The fact that yields in cash and bonds picked up has been a big boon for investors like myself who have some bond and cash holdings. On top of that, my additional purchases have helped as well.
Steve, my cool ass dividend employee is finally getting some good hours in these off months. In April, Steve’s hourly wage was $1.44. For the year, his hourly wage is now $4.03. That’s not quite minimum wage but it’s growing. On top of that, Steve’s biggest months are still ahead of him as evidenced by this graph.
May is a small month but June, September and December are huge and still ahead for Steve. That means the hourly wage is sure to rise as the year progresses especially after December!
The best part about this year is that my expenses have stayed relatively low allowing me to boost my savings rate. Not having a wedding or a honeymoon to pay for will help with that! We have no massive expense plans coming up but are looking out for a house which may put a pause to the saving bonanza. That means it’s important to me to get rolling early if I want to meet my yearly goals and I’ve certainly done that so far.
April Total : $240.00
2019 Total : $2689.94
Portfolio monthly hourly wage : $1.44/hr
Portfolio annual hourly wage : $4.03/hr
Savings Rate and Expenses
After a weak savings rate in March last year(due to wedding pre-payments), I really tried hard to save in April of 2018. That was helped by a decent tax refund which fueled my savings rate last year to 55.81%. I’m not sure if I can match this year but hopefully I didn’t fall off too hard!
My savings rate came in at an impressive 58.35% in April of 2019! That’s the 3rd 50%+ month of the year and continues a great savings rate start to 2019.
Adding in employer contributions boosts that number to 64.91%!
On a gross income basis(including taxes), I saved 45.4% of my income or 50.51% after employer contributions.
That’s a pretty sweet month and I’m happy with the results. It’s higher than last year despite my tax refund being quite a bit lower in 2019. However, that’s due to my income this year being a bit higher due to a promotion I received last year at work which helped fuel some of this additional savings.
It’s good to finish up the winter season with a strong month. I know my expenses will start to tick up as the weather gets nicer and we start to travel a bit more. We don’t have anything extravagant planned like our Hawaii honeymoon this year. However, day trips and some fancy meals are certainly on the menu and that will bump up the expenses a bit.
You can see by this yearly chart that the months around winter are generally better for my savings. We certainly become indoor people when it gets cold outside and it’s just easier to save when that happens!
There’s some rough historical months up ahead but maybe this year is the year that pattern changes. I don’t have any major expenses planned and am making a bit more which allows me to save more. On top of that, May this year is a 3 paycheck month which should help boost my savings rate too. Last year that was June and you can see what we did there!
On the expense side, it’s the usual suspects. The only surprise was a re-occurence of symptoms for my poor Teddy. She was at the vet last month with some bladder issues and the treatment only seemed to resolve the issues in the short term. The second visit was cheaper but the vet suggested that she may have to continue her medication for the rest of her life.
That means pet expenses are about to become a monthly thing instead of an every so often expense. My girl is getting older but I want to make sure she feels well so I certainly have no issues spending money to take care of her. On top of that, she’s a big fan of the peanut butter she gets with her daily pills. Who wouldn’t want this face to feel her best? Pets sure do get expensive as they get older though but they’re totally worth it.
Rent was the #1 expense as usual. We’re actually in the process of making a counter-offer on a home. That’s exciting but will also mean my home expenses will go up quite a bit since the house is 2x the size of our current apartment. On top of that, our lease doesn’t end for a while so hopefully they can find someone quickly or that could mean double the costs!
On the personal care side of things, my big expense was a nice waterpik. I’m taking my flossing game to the next level!
Overall, expenses were reasonable this month and that led to another strong savings month. That’ll only serve to give me a good backbone as the more expensive warm months come in and we start taking day trips and eating our more often. Restaurant expenses ahoy! The savings rate going forward may be impacted by our home purchase too since our mortgage will be higher than our rent and we’ll likely have to pay more in other ways too. Gotta get that lawn mower!
Still and I’m starting off well as I did last year and these high savings months will help boost my monthly dividends in these off-months and bolster my quarter ending months as well.
That is a great month TITM. You killed it on the year over year growth. The great thing about this investing strategy is even when you do have the inflated expenses and your savings rate goes down temporarily, your portfolio keeps working for you. Keep up the good work!
With such a high savings rate, you are in great shape to absorb a few unexpected expenses every now and then. Keep saving as you can and you’ll be well on your way to your goals.
I hear you when it comes to the pet expenses. My two dogs are on the back half of life and their expenses have certainly ratcheted up. We just do our best to keep them healthy and happy.
Congrats on the terrific YoY dividend growth in April.
You will soon have $300.00 coming in this month. its been nice to watch as your journey started small in the first 2 months but has increased tremendously.
Free Before Friday
I love these charts, I also love looking at the hourly wage metric! I don’t track mine month by month but loving adding them all up the end of the year! Hopefully P.C can add some tracking options for dividends
Awesome report as usual time. Love the high savings rate, but do you invest everything or save or pay your mortgage down with it?