November dividend update

I’ll do a full portfolio run down sometime this weekend but wanted to get my first dividend update out of the way.

As you’ll see in my portfolio run down, there’s a lot of dividend payers. These are in the form of index funds and ETFs in my account. That lends itself to a rather slanted dividend payout schedules.

A lot of mutual funds and ETFs will pay out quarterly. That means a lot of payments in March, June, September and December and not a lot in any other months. However, this will likely change a bit in the future as I get back into buying individual. Those securities sometimes have a different payment schedule. Still, I expect dividends to be low in the outlying months and high in those three months for the time being.

Note that the dividends I’ll be tracking will be tracked into two ways. First, the dividends from tax-advantaged accounts. Second, the dividends from taxable accounts.

Tax-advantaged accounts will simply be DRIPed into the same fund. Taxable account dividends are generally taken as cash. Those will be used to purchase other shares. That can be based on what I consider a good value and what needs re-balancing.

Note that while I could DRIP the taxable funds, I choose not to because for some reason I’m not a fan of fractional shares(OCD part of me). I prefer to have control over where those funds go. It’s easier than just reinvesting them blindly into something that I might not have researched in a while.

I generally either buy ETFs that have a $0 transaction fee. That means transaction fees aren’t an issue. Also, I can use those funds to buy securities in larger blocks which minimizes any impact of trasanctation fees when a $0 fee is not available.

Now that I’ve set the ground rules, here’s what we saw in November.

Ladies and gentlemen, I am rich and ready to retire!

Look at that! While I’m sitting around, my wonderful portfolio of securities is generating me an impressive income of $79.37 for the month of November!

If my portfolio were an employee and worked a standard 8 work day, it’d be getting paid .47/hr.

Not the greatest of wages but a young feller has to start somewhere. This must be a sales job because month to month variation will be quite large.

Hopefully, next month he’ll see a holiday related spike and see a pretty big commission check that will send Mr. Portfolio’s hourly wage up quite a bit.

It’s a funny thought. I do sometimes think of my portfolio as an additional little worker. He or she is out there earning money while I do other things.

It’s .47/hr so far from a living wage. However, it does show one how likely they are to be able to live off their dividend income alone.

Can I live of 47 cents/hr? I can’t which shows me that I have quite a lot of work to do. One day, I can get to a livable wage through dividends alone. That’s not my overarching goal. However, it’ll be nice to see that hourly wage tick up as the months and years pass.

I think it’s something I might start tracking just for fun. The month to month data won’t be all that worthwhile. Dividends are often stacked in certain months after all. However, a yearly dividend hourly wage will certainly tell us something. It’ll also act as an easy to define and fun comparison of dividend growth year over year and month over month as well.

As you see – we have a heavier dividend income from the tax-advantaged side than the taxable this month. That makes sense since that part of the portfolio is larger at this point.

The one payer in that realm was my total bond market fund which is currently yielding ~2.5%. That isn’t great and makes one wonder why I even have money in a bond fund yielding that much. Still, the bonds aren’t there to provide growth but instead to provide diversification, lower risk and to provide an avenue to buy low when stocks tank and sell high when stocks rise through re-balancing.

That reinvested into the bond fund will increase my monthly income by ~.11. That’s certainly not anything to write home about but every little bet helps in our goal.

On the taxable side, we saw some income from my small holding of Apple. I’ve owned for quite a while now. I’m an iPhone user myself although I don’t really have any of their other products. Still, I find the current valuation quite fair and would certainly consider buying more if any significant dips occur.

The main risk is that quite a bit of their revenue comes from the iPhone. However, I personally don’t consider this a huge issues as they continue to show good growth on that end. They also continue to have a loyal fan base as well as an excellent product. On top of that, they have shown that they are trying to expand their product reach with the Apple Watch and new iPad variations. Apple is also are expanding into the service side of things with Apple Music and the Apple upgrade program.

The stock itself hasn’t been a great performer in the short term. However, I expect to hold this in the long term. I would buy more but I think I already have enough exposure through various index funds and ETFs. These hold apple in significant numbers due to its high market cap.

As such, I take the dividends as cash and will invest them as I see fit soon. The stock currently sits at a yield of 1.75% with a .52 quarterly payout. The payout ratio of 21.1% and a massive cash hoard means Apple certainly has the room and capacity to increase the dividend as they see fit.

November Total : 79.47
2015 Total* : 79.47
Portfolio hourly monthly wage : 0.47/hr
Portfolio hourly yearly wage* : 0.4/hr

*Data from November and onward. Hourly wage calculated based on 12 month total which means $0 earned assumed for first 10 months.


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