I Have a Bobblehead!

Hey all, welcome to my belated dividend and expense update for April. Hell, it’s almost time to write the May update and here I am finally getting around to writing the April one.

What a slacker. It’s true, I’ve been pretty lazy on this blog and some of that comes from the fact that I started a YouTube channel. It’s quite different from the blog as I use that venue to talk about topics like SPACs or NFTs or stock investing in general. I just find that it’s easier to discuss certain topics in video format and it gives me flexibility to just babble and joke around some more on topics that don’t really fit on this blog.

You can check out the channel right here. Unsurprisingly, it’s got the same name as this channel and still has a focus on long term investing.

Secondly and may most importantly, the cool people at All-Star Money picked my dividend employee Steve post as an article of the week. I say cool people because they’re doing this thing where they send you a bobblehead of yourself as a reward!

I just had to send them some pictures of myself and they put this awesome bobblehead together that now sits on my desk.

Look at it! It’s so neat. The bobblehead is pretty high quality and does resemble me. And no, I didn’t send them pictures in which I wore a hoodie with pets on them and held a block of cheese, that’s some artistic license they took from reading my blog description. I do like cheese and have a dog and a bunny!

Thanks for the bobblehead guys! Whenever I have a question, I can hit my desk and have the little me nod in agreement.

Now that I’ve gotten past the fluff, it’s time to look at the dividends and expenses.

Last April was the first of a few negative growth months in dividends. The pandemic came, brought some cuts in dividends and sent money market and bond rates down a bunch. That combined with some lucky sales I made in March led to a decrease in dividends.

However, now that we’re past that, I’m hopeful dividends will start growing. Do you agree little bobblehead man? I know you can’t see but he’s shaking his head in agreement right now.

April is already a smaller month since most of my dividends come from mutual funds and ETFs that pay quarterly. However, any small amount counts and will help future growth.

Last year’s dividends came in at $212.90 so let’s see where they are now.

April Dividends

April came in at $282.95 or a 32.9% over the prior year. Like I said, that was a lower year but I’m still sitting above 2019 so that’s pretty nice. You can see the big growth I’ve seen since 2018 and I hope to start seeing $300 on a regular basis before the year is over.

My M1 Finance accounts are starting to make up a bigger chunk of this growth. Last year, those sat at $37.23 and are now at $61.08. and will continue to drive growth in these off months.

I haven’t done an update on those accounts in a while and might move that series onto my YouTube channel.

Even though these months make up a small % of my overall dividends, the $282.95 re-invested will mean an extra $8.21 in forward annual income.

Steve, the aforementioned dividend employee, took it easy after a hard March.

His $1.70/hour wage won’t cover all my costs just yet but it’s still a nice little extra and brings his annual hourly wage to $5.15. Still, that means I have to continue working to support Steve’s dream of not working sometime in the future.

I don’t plan to entirely live off dividends nor am I a full dividend investor but it’s nice to see these numbers go up and get to a spot where they hopefully can cover a good portion of my expenses.

May is up ahead and then we have June which should be another exciting month if March was any indication. I’m hoping for some decent growth there on an already large month.

Here’s how the year looks and what I have coming up ahead.

I’ve got some good months ahead and am off to a good start this year with 25.9% growth over last year so far. I think that might slow down as the year progresses since I’ve got a bunch of larger months still ahead(since those grow slower on a % basis) but we’ll see since March was a pretty big bump over last year.

April Total : $282.95
2021 Total : $3,436.59
Portfolio monthly hourly wage : $1.70/hr
Portfolio annual hourly wage : $5.15/hr

April Expenses – A Free Bobblehead, More Taxes, Home Stuff and Health Stuff

This year has been an expensive one.

We bought a home and with that come a bunch of expenses. On top of that, I’ve also had a lot of health issues that have led me to hit my deductible this month. That means future expenses should be slightly muted in that regard(still have coinsurance) but April and parts of May will still have a bevy of health expenses before that happened.

On top of that, I had a pretty big tax bill due to some selling I did last year and while that hit this month, I saved a good portion of the money needed last month. However, I did underestimate a bit so had to fill the gap this month.

Last year’s April had a savings rate of 75.04% which is common in these three paycheck months. However, this years expenses have trended up but I’m pretty sure I can continue to stay positive due to the fact that it’s a three paycheck month after starting the year with a negative savings rate month(home purchases are expensive)!

Let’s take a look where my savings rate was this month.

My savings rate for April was 29.9%. That’s a good deal lower than last year and continues a lower than expected year when it comes to savings. It’s certainly not a great number for one of my two three paycheck months in the year.

At this point last year, I already had three 50%+ savings rate months and this year I’m sitting at none.

That’s a combination of all the stuff I talked about and I don’t expect that to stop anytime soon. I do think this might be one of my worst savings rate years since I started tracking but that’s to be expected since I’m a first time home buyer with a lot of stuff to get.

The health expenses certainly don’t help either as high deductible plans put the first dollar spend on the consumer. I really do hate our healthcare system but that’s something I’ve talked about before so I won’t go into detail on it here.

The 29.9% savings rate jumps up to 36.72% with employer contributions.

Since I have a home now, some extra money flows into the home in the form of equity. The 29.9% savings rate becomes 34% when I account for extra equity(additional mortgage principal payments) and 37.1% when I account for all equity.

On a gross income basis, I saved 22.9% of my money, 28.1% after employer contributions. With equity in mind, the gross savings rate becomes 28.4%(33.7% with employer contributions).

That’s a lot of numbers but buying a home makes the savings equation a bit more complicated. After all, every payment and especially every extra principal payment brings with it an increase in net worth and does somewhat act like savings since it reduces future expenses.

On the expense site, my mortgage was the #1 expense although it’s a bit misleading cause that included a final payment I had to make for rent for some carpet damage in our old apartment(disputable but I didn’t feel like arguing it).

Extra taxes were next. I did my taxes in April and while I saved an estimated amount in March, it was a bit short. On top of that, since I’ll also have some gains this year, I’m making quarterly payments to make sure I don’t have a huge surprise come next year.

On the home tools/equipment front, I picked up a mower, hedge trimmer and weed whacker and a few other items to round out my yard work collection. These up front expenses will really kill the savings rate but will hopefully last a bunch of years. I know I’ll have re-occurring garden expenses in the form of yard management crap but those will be less large and sporadic as well.

Health is next and includes more pre-deductible bills. It’s crazy that simple specialist visits cost $300+ and even certain special blood work tests ended up costing me hundreds and hundreds of dollars.

It’s great that I have to spent 5.4% of my income each month on health insurance that gives me a $3000+ individual deductible with full out of pocket cost above $6000 for an individual. My wife has had some health issues this year too that meant we both hit our deductible and our family out of pocket maximum is over $12,000. Ah yes, insurance, you pay thousands of dollars to have to pay thousands of dollars.

On top of that, we’ve already gotten declinations and decisions around tests not being “medically necessary” as deemed by the health insurance company despite the doctor suggesting it. It’s crazy that a for-profit company would want to decline things like that. Who would have thought they’d have an a incentive to keep costs as low as possible.

Why can’t we just have socialized healthcare like every other country in the world? I would certainly pay 10% more in taxes if it meant everyone can have full health coverage and not have to worry about a doctor bill anymore.

Beyond that, there’s nothing amazing in there. Entertainment ticked up as I spent a few dollars here and there on some NFTs which I’ve talked about on my channel. It’s an interesting thing and I’m just trying to learn a bit about it which requires spending some money. It’s actually a profitable venture for me already since I’ve sold some NFTs for a profit(and bought more) and am diving a bit into the world of NFT based crypto games as well.

After that, it’s the normal stuff, groceries, pet food, a gift for my mom for mother’s day and all that good stuff.

Most importantly, I got a free bobblehead so that’s neat.

Overall, it’s been an interesting year. We’re home owners now, are working through a bunch of health problems(doesn’t seem like it’s anything terrible luckily) and are having fun furnishing the place and dealing with our far too big yard.

I can already see that owning a home will be far more costly than renting BUT I love it so far and enjoy the inflation protection that having a mortgage provides. Plus we get double the space so it makes sense that it’d cost more.

It’s hard to complain about a 2.75% interest rate and building equity while you do it. Plus, our neighborhood is just fantastic and the home fits all of our needs. The yard is a bit much though since we have way too many flower beds and garden areas. It’s pretty and smells nice but a heck of a lot of work to maintain.

Yea, it means our savings rate sucks this year for a variety of reasons but I’m hopeful it will start to get better as I’ve now hit my deductible and the big tax bill is behind us(although saving for quarterly payments is still ahead). That should mean good things going forward for both expenses and also dividends.

I’m still lucky to be able to save in this type of year and even when I don’t save much, all these dividends keep flowing in and being re-invested. I’ve had months where dividends have out-stripped my savings and that really speaks to the power of long-term investing. It’s great to be able to be in this spot and it will only grow from here!

Plus I also have a bobblehead of myself now and that seems pretty good.