Lanny's March Dividend Income Summary

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Includes: AMNF, BBL, HCP, O, RDS.A, RDS.B, VINIX, VYM
by: Dividend Diplomats
Summary

I received a total of $2,259.89 of dividend income in March.

My goal is to be well over $3,000, if I can, in dividend income next year (not including my wife's account).

My Health Savings Account (HSA) is now invested into a few low-expense ratio, no trade-fee exchange traded funds (ETFs).

We know what time it is. This is one of the best months to be a dividend investor, as we wrap up a quarter-end. The market finished off on an impressive note, closing up 13% for the year thus far. The weather is finally warming up, as I believe we even received a 60 degree day or two in the month. This was a fantastic month of investing and earning dividends, which truly shows the power of time and consistency pushes you forward.

Dividend Income

I received a total of $2,259.89 of dividend income in March. This is the FIRST time I have crossed $2,000 in a non-December quarter-end! Am I able to continue this stretch? Potentially. I'll discuss what caused the large pops and what I can anticipate going forward. Additionally, my wife earned $1,024 this month, and I am still debating on how to incorporate that into the analysis, which I don't mind a problem, right? Therefore, combined we earned almost $3,300 for the month! That is financial freedom, in a gray area, of course. We have retirement accounts that earn quite a significant portion of those earnings. Further, the 401(k), Health Savings Account (HSA) and all dividends are automatically invested/reinvested, and it helps to take the emotion out of timing and making a decision. Also, to find out why I max out my 401(k) and HSA, please refer to the 3rd part of my tax series, as that describes the magnitude of benefits to increase the amount you can invest due to reduction in taxes. Here is the breakdown of dividend income for the month of March:

As you can see, the taxable income is on the left and the retirement accounts are under the title to the right. You can tell I did not have one taxable dividend that was over $100. In fact, I had 26 companies paying me within my taxable account. BHP Group (NYSE:BBL) had a massive dividend and that was due to a special distribution it did this go-around. Further, there are currently 9 out of 26 companies that qualify as dividend aristocrats. I am anxious to see what Royal Dutch Shell (NYSE:RDS.A) (NYSE:RDS.B) does this year relating to its dividend, as mostly all oil players have smudged their dividends up recently. Further, given IBM's (NYSE:IBM) acquisition of Red Hat and the tribulations it has gone through, I am curious what the dividend increase will be like for it, given it yields a healthy 4.45% (I am anticipating ~4% growth; we shall see).

I have split out between the individual stock amounts and the retirement accounts, as the "- R" indicates a retirement account dividend (or the furthest column to the right). I separate these two, as I like to know what portion of my dividend income is coming from those retirement accounts that I cannot touch until 59.5 (barring any other usage rule I could use). Here, it shows that I received a total of $1,189.24 (up from $599.84 last year) or 52.6% of my income from retirement accounts and the other 47.4% was from my individual taxable account portfolio. This ratio increased from last year due to receiving a larger VINIX dividend - as capital gains were distributed, as well as Vanguard's High Dividend Yield (NYSEARCA:VYM) being added, packing a solid punch. Lastly, this shows from retirement accounts that I'm all ready for my set it and forget it mentality to keep that income going. To see my portfolio, one can go to our portfolio summary page.

Dividend Income Year-over-Year Comparison

2018:

2019:

Now, I will compare the previous year's linked month to this month. Again, another incredibly high growth rate, as my dividend income was up 51%. My goal is to be well over $3,000, if I can, in dividend income next year (not including my wife's account). An extra $741 higher is going to be a massive effort, but you KNOW I'm ready to take on the challenge. Further, April will have incredible aristocrats increasing their dividend, as well as other companies, such as IBM.

There are many changes here, but is primarily on the retirement side. My Health Savings Account (HSA) is now invested into a few low-expense ratio, no trade-fee exchange traded funds (ETFs). This added more income than ever before. Further, Vanguard's High Dividend Yield is new versus last year. This also could have shown bigger growth, as HCP paid in February this year, as opposed to March (like last year).

Dividend Increases

A month wouldn't be a month without high-quality companies increasing their dividend. See the small chart below for the details on the dividend increase announced this month from my portfolio.

Fairly minimal here, March is normally a quiet month to say the least. However, my favorite Italian market producer - Armanino Foods of Distinction (OTCPK:AMNF) - came through with a double-digit add to the portfolio. Realty Income (NYSE:O) stayed in its consistent ways and threw in a little nugget. The dividend increases above represent an investment $166.28 at 3.50% to accomplish this feat.

Dividend Income Conclusion & Summary

The name of the game is to apply what you learn through financial education. The next steps are to maximize every dollar for investment opportunities and live a balanced life. My plan is to show that dividend income can be a revenue engine. A revenue engine that can allow you to take back control of your life. Dividend investing, once you learn the right way, becomes easier and starts to make quite a bit of sense.

There is a nice adjustment to my most recent monthly expenditures article. My property taxes increased by 14%. Therefore, my new average is around $1,040 per month. Therefore, my current dividend income would cover 217% of my average $1,040 monthly expense. WHOA! I can cover the monthly house expenses TWO times over, without missing/skipping a beat. The greatest about this is I can cover the housing expenses plus EVERYTHING else in a given month - food, gas, entertainment, you name it. Again, the amount, though, needs to come from my taxable account, as more than half of my dividend income this month came from retirement vehicles. In similar fashion, all of the investing from last year and moves this year show that my aim to save 60% of my income, and making every dollar count, has allowed promising results already this year.

Best March in the books! Did you crush records and entered new territory than ever before? Ready for the next level and to continue to grit and grind your way there? You know I am, therefore, YOU are NOT alone. LET'S GET IT! I truly hope that you can see the power of this in hopes of brightening your financial journey. Thank you again, good luck and happy investing!

Editor's Note: The summary bullets for this article were chosen by Seeking Alpha editors.