Dividend Income Update - July 2014

Includes: BAX, BNS, GE, ITW, KO, MDT, MO, O, PM, SYY, VER
by: Jason Fieber

Another month has passed by, and it’s time for me to post an article on my favorite subject: dividend income. The reason why I love to post articles on dividend income is because it’s pure numbers. It’s hard to argue the success of long-term dividend growth investing when you can slowly and surely see dividend income rise over time and get closer to covering one’s expenses.

July was really strong, and just another step in the right direction. Every month of dividend income is one month closer to financial freedom, and I never forget that. I don’t know if I’m just weird, but every time a fresh dividend is deposited in my account I feel fantastic. Of course, how could more money coming your way with no work on your part not make you feel good?

I hope these monthly dividend income reports provide inspiration for any investors out there that are just starting out. It’s easy to see these payments rising month after month and it shows that it’s possible to one day pay for monthly expenses with dividends, which would provide an investor opportunities and freedom to pursue other interests than full-time work. Without further ado:

July 2014 Dividends Received

  • Baxter International Inc. (NYSE:BAX) – $23.40
  • The Coca-Cola Company (NYSE:KO) – $42.70
  • Illinois Tool Works Inc. (NYSE:ITW) – $14.70
  • Altria Group Inc. (NYSE:MO) – $38.40
  • Phillip Morris International Inc. (NYSE:PM) – $108.10
  • American Realty Cap. Prop. Inc. (ARCP) – $14.17
  • Realty Income Corp. (NYSE:O) – $12.80
  • General Electric Company (NYSE:GE) – $28.60
  • Medtronic, Inc. (NYSE:MDT) – $11.29
  • Sysco Corporation (NYSE:SYY) – $8.41
  • The Bank of Nova Scotia (NYSE:BNS) – $12.54

Total dividends received during the month of July: $315.11

I still can’t believe it sometimes. I’m receiving hundreds of dollars per month for doing nothing more than being alive. Before I even actually try to go out and actively make money, I’m already covering a significant chunk of my expenses every month. The joy of being a dividend growth investor.

I still remember waiting tables in my early college years. It would take me a whole week of delivering food and cleaning the salad bar to earn this kind of money. It now comes my way with no additional effort on my part. The effort has already been realized in the past, as the me of days past took excess capital from savings and invested it in high-quality businesses. The me of today could theoretically sit back and enjoy this rising passive income stream for the rest of my life, but I choose instead to continue building on it. Imagine if Michelangelo hadn’t finished the frescoes inside the Sistine Chapel. Much like that, I must see the Freedom Fund, and my financial independence, to the end.

And that’s because financial freedom is something, like the frescoes, beautiful and worth working hard for 10 or more years of my life for. And once financial independence is attained, I’ll have the rest of my life to sit back and enjoy it.

The total you see above was a 73.4% improvement over what I received in dividends during July 2013. That’s a pretty big year-over-year improvement, but I know increases in percentage terms will decline as my dividend income grows. However, the most important thing isn’t percentage increases, but rather real income growth, which propels me closer to financial independence.

I was able to cover 23.1% of my personal expenses via dividend income. It’s just awesome to know that a little over four years into my journey to financial independence that I can routinely cover almost ¼ of my personal expenses via passive income alone. And what’s even better is that anyone can do this. I’m nobody special. I simply have a desire to escape the rat race and buy myself freedom. And you can do the same!

I expect August to be yet another great month for dividend income, and a bit more than what I received for this month. It’s just another step on the road to freedom.

One of my goals this year is to receive $5,200 in dividend income throughout 2014. With seven months in the books, I’ve now earned $3,117.63 in dividend income for the year. That’s an average of $445.38 per month, so I’m on my way to exceeding my goal and then some. I’m anxious to see just how much I can crush this thing. I’ve completed 60% of my goal thus far, so I’m on pace for a great year of passive income.

I’ll update my dividend income page to reflect July’s dividends.

Disclosure: Long all aforementioned securities.