Dividend and Expense Review – December 2019 – December Dividends
It’s that time of year. December dividends are in and counted! Hope your holiday and new year’s break was great but it’s time to get back into the swing of things!
If you’re an investor, December can be a big deal. It’s the biggest dividend payout month of all for most. Mutual funds and ETFs pay quarterly and some even pay once a year. That leads to big numbers in December. That’s the case for me as one my bigger mutual fund holdings pays once in December. As such, December dividends are the highest total I see each year.
I know that every little month matters. However, it’s always cool to see big numbers. I knew going into December that it would be a make it or break it month when it came to my goals.
That was both on the dividend front but also on the savings rate front!
December is also the holiday season and expenses tend to trend up. We’re not a big holiday family BUT we do spend a little bit here and there. I wasn’t too concerned going into this month about my expenses because I’ve done so freaking great this year on that front.
I’ve already had eight 50%+ savings rate months this year and that can’t be beat. It’s been by far my best savings year and I can’t wait to see what it means for results going forward.
I didn’t go out of my way to be overly frugal this month. My Christmas gift to the wife was a Nintendo Switch and I spent some money on various other small gifts for my nieces, nephews and friends. However, since it’s winter and we’re in hibernation mode, we don’t really go out as much which may help to offset the spending on gifts.
Back on the dividend side, last month I saw growth of about 20.6% on a much smaller month. Since December dividends are a much bigger starting point a growth rate like that would be outstanding. One of my goals this year was to collect $12,750 in dividends and for those keeping score, I’d need $3,963 this month to get that.
As a reminder, last December came in at $3,469.18.
December clocks in at $4,162.24! That’s a 20% bump over last year.
I’m very pleased with these numbers. The big bump also means I hit my bronze goal for the year and set myself up well for future years.
The trend in the above graph is clear and really speaks to the power of compound growth. It’s awesome to see the first $4,000+ month and makes me eager to invest more next year!
That brings my total for the year to $12,948.77! That’s a growth rate of 20.99% over 2018 which is pretty damn fine and dandy if I say so myself.
The $4,162 this month will be re-invested into dividend paying securities and will generate an additional $95.73 annually for me. You add that to all the additional dollars flowing into the market this month and forward into 2020 and that spells good things for next year’s December. Maybe $5,000 will be in the cards!
It’s too bad that every month isn’t as big as this one or I’d be all set!
On top of the dividends, I also had $18 in short term capital gains and $2,365 in long term capital gains from mutual funds I hold. Those dollars were also automatically re-invested for more shares.
Steve, my dividend employee, had his best month ever. The dividends translate to an hourly wage of $24.97 and the big boost brings his annual wage to $6.47/hr. It’s not quite minimum wage but he’s getting there!
Overall, things went very well this year. My dividend totals keep increasing and the trend is very favorable.
As always, December dividends are the big drivers for the year but my individual months are growing as well. I’ve been putting more money into my M1 Finance account which holds individual securities. That means I’m getting more dividends in the months that were historically low.
Given the recent stock market surge, I’ve also been buying more bonds in the past few weeks to get back to target allocations there. That means monthly dividends will grow a bit as well. The offset to that is shrinking rates which will hurt a bit on that end despite additional money flowing in to bonds.
I’m not a dividend investor specifically but I do see them as motivating force when investing. It’s always amazing to see these graphs and to see how far I’ve come. I’m nearing $13,000 in annual dividends and am likely on track to break $15,000 next year. It’s awesome to see the power of compound growth working for me!
December Total : $4,162.24
2019 Total : $12,948.77
Portfolio monthly hourly wage : $24.97/hr
Portfolio annual hourly wage : $6.47/hr
December Savings Rate
December is a great time of year. Holidays can get stressful BUT I get plenty of time off from work and work at home when I don’t. On top of that, it’s pretty dead at work around this time so there isn’t much working going on anyway. It was awesome to basically beat home for two weeks straight and going back to work yesterday was a real drag. It reminded me of why I save so much. It’ll be nice to have more time to myself when I no longer NEED to work.
On the expense side, we’re not big holiday spenders but gifts here and there can still add up and I think we spent a bit more this year than we usually do.
Last year’s savings rate was 59.17% and that’ll be a tough one to match.
Let’s take a look at where I ended up this December.
My savings rate stood at 46%. It’s not quite a 50% month like last year but still quite good. That’s post-tax money for those keeping track at home.
Adding in employer contributions brings that number to 54%.
On a gross income basis, I saved 32.9% of my income or 38.2% after employer contributions.
Overall, this was a pretty good month. You add the December dividends to this and I’m getting a lot of extra shares of securities I already owned. That means good things for 2020!
It’s always great to be fortunate enough to save money during an expensive month like December.
Rent was my #1 expenses usual but gifts showed up big here too. The biggest expense was the Nintendo Switch I got for my wife(she’s been digging the latest Pokemon game) but there were a few other gifts handed out to everyone.
Groceries were #3 and were higher than usual as we stayed at home more and ate in more as well.
After that, things start to drop off and include the usual suspects. I renewed some prescriptions which explains the health spike and since my expensive insurance is a high deductible plan, it’s 100% of the cost to me! Yay, insurance!
I also bought a bunch of steeply discounted video games during the steam sale. It pays to be a patient gamer! If you can wait a year or two to play games, you can save 50-75% or more during steam sales(or regular sales if you’re a console gamer).
I also picked up a few J.Crew flannels during one of their post black Friday sales. Extravagant!
As you can see, we’re not big spenders. It helps to be a homebody when it comes to savings. We do have some expensive things planned for 2020 but hopefully can offset that with a strong start before it warms up. However, we are hosting a party for my dad’s birthday in January which will likely cut into the savings rate there.
I’m very happy with the results on both ends for December. I just can’t complain about either result here and I’m excited to see what 2020 brings.
I’ve got my 2020 personal goals and resolutions set but still have to work on my financial goals. I’ll do a year in review to see how I did against my 2019 goals before I set those so look forward to that soon.
We’re deep in the throes of winter now but I’m eager to move into 2020 and a whole new decade.
Here’s to a great 2020 and hope your 2019 results were as good as mine!