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May 01 2016

Dividend Income Report for April 2016

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Spring is here! Spring and autumn are my favorites seasons, as the temperatures and general weather conditions are milder. Working outside is much more pleasant and the longer daylight hours means some outdoor work can get done on weekdays when I get home from the day job.

Enough about weather and other trivialities. You’re here to know how my  dividend income for April added up,  so let’s do the numbers and see…

AWP $ 3.50*
BGY $ 49.00*
CHW $ 21.00*
CIK $ 22.00*
CLM $ 54.19*
CODI $ 54.00
DHY $ 42.00
DMF $ 13.50
DSM $ 22.83
EDF $ 13.50*
EHI $ 35.61
EXG $121.95*
HHY $ 37.50
HTR $ 38.00
NCV $ 45.50
OIA $ 4.10
PFN $ 36.00
PNNT $ 21.00
RSO $ 63.00
VFL $ 18.00
TOTAL $716.18

* Includes Return of Capital..

Overall, April’s total of $716.18 was pretty good, as it was my third highest dividend earning month ever! While not as dramatic as December’s total of $747.83, $716.18 is a good sum that I’m quite pleased with.

Wow! Has the market been on fire or what? Thanks to the sustained rally that pushed the Dow beyond 18,000, my dividend investing portfolio’s value has climbed nearly $6,000 from March 1st to April 31st (excluding cash transfers and dividend payouts). Sweeeeet! But I’m very much of two minds about the current bull market. On one hand, I’m happy to see my portfolio’s value recover from the beating it took when the market freaked out in August and February. But on the other hand, I want another bear market because for dividend stocks, when the stock price drops the dividend yield rises and that’s the best time to buy. Truly very contradictory desires!

April may have been a good month but it wasn’t all dancing unicorns and rainbows. Despite the positive market, HQL announced a dividend cut, reducing its quarterly dividend from 48 cents per share to 37 cents. Fortunately, my exposure to HQL isn’t very much so the projected monthly average dividend income only took a $3.67 nick. I guess I’ll make up for it by spending a dollar less every week at the company cafeteria.

As a side-note, I’d like to get something off my chest. Earlier this month, Rockstar Finance featured a link to The Smarter Dollar’s blog post The 2016 Ultimate Guide to Passive Income, a list of 35 different ways to earn passive income (I highly recommend reading the post. Good stuff there.). Each method’s doability (how easy it is to get started) was graded on a scale of 1-10, with 1 being very difficult and 10 being extremely easy. So how did dividend investing fare? Not well. Yes, dividend investing takes both money (the more capital you can shovel into dividend stocks, the better) and time (spent on research). Dividend investing’s doability score? 3/10. Ouch! Jeez, I know dividend investing isn’t as easy as the “buy low, sell high” capital gains approach, but it’s not THAT hard either. I think 6/10 is a more accurate assessment. What do you think?

“BORING. If the thought of spending hours and hours and hours researching stock picks, then go for it. Invest in individual stocks.”

Sure, there’s nothing sexy or exciting about dividends, but so what? Spending 2-3 hours once a month at my PC poring over screeners, financials, and updating spreadsheets is no thrill ride, but it’s a better use of my time than watching TV or idle web surfing. Do you know what isn’t boring about dividends? Having them roll in every month or quarter like clockwork and not having to exchange my time for them. I invest for reliable returns in the form of dividends, not for excitement and titillation. If I want that, I’ll just go to Las Vegas.

Finally, the author concludes his coverage of dividend investing with this sentence:

“Just use index funds, and stop wasting your time picking stocks.”

I like index funds too. After reading The Smartest Investment Book You’ll Ever Read by Daniel R. Solin, I began converting my IRA’s holdings over to index funds. They’re a great way to invest for the long term. But for increasing one’s immediate cash flow, index funds aren’t so good. Dividend paying index funds typically have yields in the 1-2% range, so I would need significantly more time and/or money to achieve the same income that I’m currently getting from my dividend investing portfolio.

Dividend investing isn’t perfect, and I’m fully aware of its inherent disadvantages. However, I believe its advantages make it worthy of consideration for anybody’s investing and passive income toolkit.

Image Credit: jarmoluk (pixabay.com)

 

2 comments

  1. Tawcan

    Dividend income is boring but I’ll take it anytime. Gotta love getting paid while doing absolutely nothing right? Congrats on receiving over $700 in dividend income for April.

    1. Dividend Quest

      *Exactly* Dividend investing may be boring to some folks, but there’s nothing boring about passive income no matter how it arrives. It always feels a little like Christmas Eve the day before those expected dividend dollars appear in my account.

      Thanks for the congrats about breaking $700. It’s nice to know that it will be happening with increasing regularity. Breaking $800 is another major milestone I look forward to reaching.

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